Peter Stefanovic:
Joining me now from Canberra is the Assistant Treasurer, Michael Sukkar. Good to see you, thanks so much for joining us. First of all, the back track from snap back language – it’s a bit of a tongue twister – there seems to be a bit of a shift in the language that’s being used. Does that suggest that things are worse than you expected?
Minister Sukkar:
Good to be with you, Peter. I don’t agree that there has been a change in language. What we have said from the beginning is that this would be a devastating thing for the economy, which seems pretty self-evident, that we would put in place a whole lot of programs in place to cushion the blow for Australians, whether that’s payment to households, direct payments or whether it’s the coronavirus Supplement which is essentially $1,100 a month through JobSeeker or whether it’s keeping people connected to their employment through a $1,500 per fortnight JobKeeper payment in addition to cash-flow support for business. So, from the beginning we have said that we are going to put in place a whole suite of policies to cushion the blow. We have said that if we can get on top of the health issues as soon as possible, that it will give us the greatest possible chance on the other side of the crisis, to take advantage of what will hopefully be economic opportunities around the world. Now, that hasn’t changed. I think, Peter actually we’ve probably exceeded many people’s expectations as to the health outcomes and I’d expect that has a positive impact on the economic outcomes as well.
Stefanovic:
Okay well just on that, let’s talk about JobKeeper. When should that begin to be phased out?
Sukkar:
Well, Peter, that’s been legislated for six months as part of that legislation as well…interrupted.
Stefanovic:
You could phase it out earlier?
Sukkar:
No, it’s a six-month programme that is being reviewed by Treasury at three months. We are six weeks into it so I think it’s probably a bit premature to be talking about that. I know that there are 800,000 businesses who have enthusiastically enrolled in the scheme which covers something like 5.7 million employees now. So, it has been an absolute lifeline – as many small businesses have said – for the economy but we are six weeks into it and I think it’s probably a bit premature to be talking about its phase-out.
Stefanovic:
Well Jason Falinski says it should happen when schools go back. Do you agree?
Sukkar:
Well it’s a six months legislated programme, Peter, that’s the legislation, that’s what we all voted on, that’s what we all agreed upon and Treasury will review it at the halfway mark to see how it’s going, to see whether it’s meeting its objectives. I think pretty clearly – from the feedback we have been receiving as a government – it is meeting the mark, meeting the objectives of keeping people connected to their employment and importantly, giving those employers a wage subsidy that means they can continue operating their businesses, in many cases in pretty extremely modified circumstances. So, I think the early news of JobKeeper is that it is an extraordinarily popular programme doing important work for the economy, but I don’t think six weeks into it we should be talking at this stage about its phase out.
Stefanovic:
Okay, so Jason Falinski is wrong then?
Sukkar:
People are entitled to raise their views but again, it is a six-month programme, Peter. That’s what we all voted on, that’s what we all agreed upon.
Stefanovic:
It would stand to reason though that you would want to preserve as much money as possible though, right?
Sukkar:
Well, Peter again, it’s a six-month programme, it’s a temporary programme. It’s not a programme that has been put in place in perpetuity, we put it in place in a temporary fashion like all the work that we’ve done. All of the programmes that we’ve put in place are there to deal with what we hope is as temporary as possible crisis of the pandemic and consistent with all of those policies, it has an end date but it has been legislated for six months. It will be reviewed by Treasury after three – that baked into the legislation, that’s uncontroversial – and at this stage, six weeks in, I think it’s a bit premature for you and I to be labouring the point as to where it goes. We think – and my expectation is – it will be a programme that will be required for the legislated period.
Stefanovic:
Okay, well when that legislated period comes to an end at the end of the September quarter, what is your modelling telling you at the moment about the unemployment rate? I know you’ve already said that it’s expected to be around ten per cent at the end of the June quarter but when those extra payments stop at the end of September – whether it’s JobKeeper or JobSeeker – what is the level, what is the unemployment level that you’re expecting at this stage?
Sukkar:
Well, a lot of it will depend on where the restrictions go, Peter as you understand. One of things that we have said publicly is that once the sorts of very hard restrictions that have been in place are eased, then quite quickly up to 850,000 people will be able to enter the work-force again. Whether they are people that have been virtually locked out of their employment because they work in hospitality and they’re literally not open, there is a cohort of around that 850,000 mark of people who will quite quickly be able to move back into the work force, but again, it all depends on how quickly we get back to, in a sense, as close to a business-as-usual economy. Obviously the harder and the longer the restrictions are, the higher that unemployment number would necessarily be.
Stefanovic:
Just one more question, if you wouldn’t mind. The talks at the moment around an escalating trade war between Australia and China – Simon Birmingham was on the show earlier and he was down-playing any fears that there would be a trade war, but you’ve got the dairy industry that is trying to seek some facetime with the Government at the moment. Can you assure them that they won’t be caught up in it?
Sukkar:
Well the great thing is, Peter, we have done – as a government – more for trade than any government before us. Whether it’s opening up new markets through our free trade agreements with China, Korea, Japan, I think we need to take all of these issues on face-value and deal with them as they are. So, whether it’s an issue around barley – these sorts of issues crop-up from time-to-time and I think you’ve got to deal with it on its merits and not seek to conflate it with other geo political issues. I think that if we deal with it on its merits, that that’s the best approach for Australia to take and I know that that’s the approach Simon Birmingham and the Government more broadly is taking to any of these individual issues.
Stefanovic:
Michael Sukkar, appreciate your time this morning. Thanks for joining us.
Sukkar:
Thanks so much, Peter.