Senator the Hon. Mathias Cormann
Minister for Finance
Leader of the Government in the Senate
Senator for Western Australia
Date: Tuesday, 16 June 2020
DAVID KOCH: The COVID crisis has cost Australia $100 billion in lost economic activity, with budget deficits forecast to reach record highs over the next two years. The Prime Minister’s grim outlook comes as the Government invests tens of billions of dollars on fast-tracking major infrastructure projects across the country to generate jobs. The Finance Minister Mathias Cormann joins me this morning. Minister, thanks for joining us. Gee it was blunt, wasn’t it? The Prime Minister saying we’ve got a mountain yet to climb, we can’t save every job or every business, it would be callous to say that we could. What should we be preparing ourselves for?
MATHIAS CORMANN: We have gone through the worst crisis globally in a hundred years. The impact in Australia has been comparatively more benign. We will have the third lowest fall in GDP across the OECD, but nevertheless, it has been a massive impact and we now need to ensure we get the economy growing again to its fullest potential and that is what we are focused on – a pro-growth agenda, a plan for stronger growth over the next five years to get people back into work.
DAVID KOCH: Okay, because even though our borrowings are going to go up to record levels, you need the economy to get back going so all of us can pay more tax to pay down that debt. It’s as simple as that, isn’t it? So how are you going to get us back going?
MATHIAS CORMANN: That is the plan. We want to get the economy growing above trend so that we can generate more revenue and by controlling expenditure growth rather than pursuing austerity we will be able to get the Budget back into balance over time.
DAVID KOCH: So like what? You’ve got the big infrastructure programs, that’s great for construction. What about the rest of the economy and the rest of the jobs?
MATHIAS CORMANN: What we have to do is get business investing again. We will be pursuing initiatives in terms of tax incentives, in terms of deregulation, in terms of better access to markets around the world for our exporting businesses. We have to find ways to give business the confidence to invest and to hire more Australians again. So right across the policy spectrum, better flexibility in terms of workplace arrangements, which is what Christian Porter is working on with the unions and employers groups as we speak. We have to make it easier for business to be successful and profitable into the future so that they can hire more Australians.
DAVID KOCH: Okay. Part of this bridge the Prime Minister has talked about with small business, getting it across to the other side, has been JobKeeper, legislated through to the end of September. Can you guarantee us it will stay until the end of September? You’re going to review it end of this month, aren’t you?
MATHIAS CORMANN: It will stay until the end of September, but our objective as a country has to be that we get business back into a situation where they can pay the wages of their employees out of their income rather than relying on taxpayer support. This was always designed to be temporary support, necessary and important temporary support, but nevertheless temporary support. So what we have to do from here is to ensure that businesses across the economy are in the best possible position to stand on their own two feet again.
DAVID KOCH: So you’re giving yourself an out here. It won’t stay in its current form until the end of September? You can’t guarantee that?
MATHIAS CORMANN: What we have said is that it will be in place until the end of September. There is a review currently underway and we will make judgements once we receive the findings and the recommendations of that review. It would be irresponsible for me to make judgements without having seen that information come through. We also want to see how the economic data evolves over the next few weeks and over the next month or so.
DAVID KOCH: Alright. Mathias Cormann, thanks for joining us.
MATHIAS CORMANN: Always good to talk to you.