Senator the Hon. Mathias Cormann
Minister for Finance
Leader of the Government in the Senate
Senator for Western Australia
Date: Friday, 27 March 2020
QUESTION: Today’s national cabinet meeting are you expecting there to be some sort of resolution especially on this issue about rental assistance for both tenants and even for landlords?
MATHIAS CORMANN: It is on the agenda. Australians would like to see some swift resolution on this. This is a significant challenge as we go through this period. Businesses who have had massive reductions in their revenue are still having to cope with ongoing fixed costs. It is important for there to be pragmatic solutions to help all Australians through this next six months period in the best possible way.
QUESTION: Are you expecting an announcement on this issue by today? What have been the delays here? Have there been issues with insurers and the way that leases are formed and so forth have added to the complications of making an announcement earlier?
MATHIAS CORMANN: I will not pre-empt the decisions or the discussions and decisions through the national cabinet. But I would not concede that there have been delays. This is a pretty complex set of circumstances with lots of different stakeholders. The key here is to come up with a way forward that is fair and that is sustainable and that equitably spreads some of the pain, so that everyone has the best possible, appropriate chance to get safely to the other side of this crisis. I do not think that it is far away. There is a lot of goodwill. All of the States, the Commonwealth and a lot of the stakeholders, everybody understands what is at stake here. There is a lot of goodwill. I think this issue will be resolved.
QUESTION: What can you tell us about a plan in the works to put businesses into hibernation though this time?
MATHIAS CORMANN: We have been talking about this for some time. Those parts of the economy that in order to protect people’s health and save lives have had to be effectively shut down, will necessarily be in a level of hibernation over the next few months, with a view of coming back strongly on the other side. What we need to figure out is how we can, in the most appropriate fashion, and in a sustainable fashion, keep as many businesses as possible alive through this period so that there is this opportunity for the strongest possible bounce back on the other side.
QUESTION: Senator, why wait then to keep giving the money out? Why wait for this period to get this money into people’s pockets?
MATHIAS CORMANN: We are working as fast as we can. It was always going to be the case - we are looking at a period of at least six months - it was always going to be the case that the support would have to be spread over a period. We are not going to put $189 billion worth of stimulus and support into the economy in one hit. That was never going to be the case. It was always going to be phased in. It is also true that in order to kick this off, a lot of systems work has to be done so that from a logistical point of view, all of this can be done in an appropriately efficient and effective way. We do want every Australian who needs this support, who deserves this support, who is entitled to this support to get it as swiftly as possible. But necessarily there is a level of work involved in setting all this up.
QUESTION: Minister, I appreciate that this has never been done before. And I understand that it is going to take some doing. But, how do you, when a business rolls down its shutter door one day, freeze all of its workplace liabilities, its rental liabilities, its overheads so that on the other side it can open up without accruing a single other dollars’ worth of debt. So you have got to get everybody on this don’t they?
MATHIAS CORMANN: That is the key question. That is what we are working on. It is not easy. It is an unprecedented circumstance. But the key point here is what you have said at the end. We are all in this together. Everyone needs to pull together to find the best possible, least bad way possible to get through the next six months. We do know that this period will come to an end. We do know that there will be a recovery on the other side. All Australians have to pull together to help every other Australian through this period.
QUESTION: And that means everyone has got to take a hit. So if you are a commercial landlord, if you are a bank, if you a State government with land tax, if you are a local council collecting rates, everyone has to freeze these payments for a while.
MATHIAS CORMANN: The key here is to come up with a fair and equitable way to spread the pain so that everyone has the best possible opportunity to be there safely on the other side. That is what we are working on. That is not easy. There are a lot of different legitimate interests. There are a lot of different legitimate interests here. But it is a matter of convincing every part of the equation to do their bit, so that as many Australians as possible can get through this safely.
QUESTION: Can you walk us through the payments system then? In terms of the way the Australian payments system, the taxation system works, it does take some time to retool those doesn’t it? When other people can’t do it.
MATHIAS CORMANN: We are looking at a more than doubling of the number of Australians receiving the jobseeker payment. We have more than doubled the jobseeker payment. We are changing the rules under which you are able to access job seeker payments. These are all things that have to be fixed in the system compared to what was there before. It could well be that we are going from about 800,000 odd jobseeker payment recipients, based on the Treasury costing assumptions, of another million on top of the 800,000 who are currently there. These are significant logistical exercises. We are working as fast as we can. But in the end there are some processes that necessarily have to be undertaken.
QUESTION: In terms of you talking about people needing to pull together, yesterday Solomon Lew even announced to the stock exchange that he was shutting down most of his retail stores and standing down staff and was not going to pay any rent. So it sounds as though he did that without even negotiating with his landlords.
MATHIAS CORMANN: I will let him talk for himself. I am not a commentator on individual businesses.
QUESTION: The other thing that you have to make sure of course is businesses don’t do things that they have always wanted to do and use this as an excuse to do it.
MATHIAS CORMANN: There are a lot of issues to be worked through. There is no question about that.
QUESTION: In terms of the freezing repayments, is it your understanding that that lump sum that you miss over that period of a freeze, then it gets added to the total at the end of that?
MATHIAS CORMANN: I think that you are now getting way ahead of yourself in terms of things that are yet to be announced.