Senator the Hon. Simon Birmingham
Minister for Finance
Leader of the Government in the Senate
Senator for South Australia
Date: Thursday, 11 March 2021
Ali Clarke: Simon Birmingham, Finance Minister, good morning.
Simon Birmingham: Good morning, Ali.
Ali Clarke: The number one question we're getting from people with regards to this injection of one point two billion dollars into supporting the tourism industry is if the government is going to subsidise flights, there'll be half price. Won't the airlines just pump up the prices and will be paying full price, if not more, anyway?
Simon Birmingham: No, they won't, because we have been benchmarking the airlines prices prior to settling this policy and discussing it with them. So we will be making sure that these half price fares are against what they have been charging over particularly the month leading up to the settlement of this policy. So through pretty much the course of February and the airlines will be held to account that the half price fares we're getting taxpayers to contribute to, which are all about trying to save jobs across the tourism industry, will genuinely be half price fares. We know that when people spend a dollar on an airfare around Australia, they usually spend then another 10 dollars on accommodation, on experiences, on restaurants and dining, et cetera. And so this is really all about supporting those jobs, those businesses, by getting people moving across the country.
Ali Clarke: Okay. Another issue that we're hearing from a lot of texters is this one. It's the uncertainty. Here's somebody that's Spence Denny caught up with on the streets of Adelaide earlier this morning.
I don't think it's enough because the way that the states have reacted to outbreaks means that the borders will go up at a moment's notice. So I'm not inclined to travel to any other state. I mean, if you can get a half price here to Kangaroo Island, fine but I'm not leaving the state.
That uncertainty, Senator Simon Birmingham. I mean, how can you assure anyone up for that? I mean, we've seen the lockdown happen in Melbourne. We've seen our Parafield cluster change borders. We've seen Perth shut borders instantly and on a dime.
Simon Birmingham: I understand the fear of uncertainty. And in part, that's what we're trying to overcome by making it more financially attractive. The airlines and tourism operators are also trying to overcome that through more flexible terms and conditions that exist in many of the bookings that are made today. So people can have greater confidence that if something unpredicted, unexpected happens, they will be able to get their money back or make changes to their arrangements and do so with a fair degree of confidence. But I think we can also see that there's a changing dynamic. Australia is has now recorded 14 days across every single state and territory without any community transmission of COVID in many states. That's much, much longer, New South Wales has hit it 50 days, SA's hit 77 days. And so we do have this largely under control across the country. The vaccine rollout is going to progressively change the risk profile. And we've seen states acknowledge that Queensland's chief public health officer has acknowledged that, that she thinks that border closure dynamics will change as a result of the vaccine rollout. And so this programme running in tandem with that, we hope will give people the confidence to to travel again, to book again, and to support those jobs across our tourism sector.
David Bevan: Were these destinations based on seats the Coalition wants to win?
Simon Birmingham: No, they're based firmly on regions in each state that are most internationally dependent in terms of their visitation. One in three visitors to Kangaroo Island in South Australia are usually international tourists.
David Bevan: So you've brought a higher standard here. You've brought a higher standard than you did to the sports rorts.
Simon Birmingham: You run the commentary, David. I'm just saying-
David Bevan: Well, no I'll put it to you that the sports rorts was a scandal. Now you're handing out money to cut price destinations. I'm just asking you, is there is it going to be a better standard?
Simon Birmingham: This has been a data informed process looking at those regions across Australia, most dependent on international visitors. You know, Australians usually spend or spend in 2019, 65 billion dollars leaving the country and spent that money overseas. International visitors in 2019 spent 45 billion dollars coming to Australia. So we usually have a net deficit when it comes to tourism. If we can get Australians to spend even two thirds of what they customarily spend overseas on domestic travel and domestic holidays, then we make up for the loss of those international visitors. And this programme has been structured to target those regions most affected.
David Bevan: Federal Finance Minister, Simon Birmingham. Are you concerned at companies that have been profitable through the pandemic and have received the JobKeeper subsidy and are keeping it?
Simon Birmingham: David, we structured JobKeeper so it could happen quickly and support right across the economy at a time of enormous uncertainty now-.
David Bevan: It's acknowledge that some companies that some companies were profitable and they got JobKeeper, shouldn't they hand it back?
Simon Birmingham: Some companies did end up seeing a positive impact. And some have made a decision to hand some dollars back. And it's very welcome where they have done so. The combination of JobKeeper and all of the other support measures we've put in place has given Australia ultimately an economic dividend far better than any comparable nation. We had a decline in growth across Australia last year, far less than most other developed nations around the world. And then we backed it in with two quarters of consecutive growth at a level never seen before in Australia's recorded history. So these programmes have worked for the economy overall. They've seen more than 93 per cent of people who lost their jobs or stood down back at work. And yes, you know, there are some who have managed to profit from it. But what we can see overall is they've worked to actually save jobs and save our economy from the type of devastation that's happening elsewhere and in this case, this airline recovery package and the support for the tourism industry around the rest of the world, more than 20 airlines are estimated to never fly again as a result of COVID. That's the type of destruction we're seeing elsewhere and that's what we're seeking to avoid here in Australia.
Ali Clarke: Senator Birmingham, some quick questions from listeners. And we're heading to the news. Is it half price return or one way?
Simon Birmingham: Return, you get go on the holiday and come home again.
Ali Clarke: I'm asking for the listeners. Is it only economy fares?
Simon Birmingham: Yes, that's what we are targeting here. So it's 46,000 discounted fares, discounted economy fares per week, 800,000 overall.
Ali Clarke: And is there everybody eligible? It's not means tested.
Simon Birmingham: Correct, it is. I mean, the airlines will be selling these seats as they would customarily run discounted flights and they will no doubt be doing their own discounting on top of these fees.
Ali Clarke: All right. And is it going to be available in peak times like school holidays, long weekends?
Simon Birmingham: That's less likely, Ali. We will be working through looking at the different regions that we're targeting to make sure that what we are doing is filling beds and rooms in those regions when those regions need it most. There's no point us discounting fares when some place is already booked out. And what we want to make sure is that that in terms of saving those jobs and back filling those international visitors who aren't there, we're getting people there when those regions need it most.
Ali Clarke: Okay. And quickly, can people start booking these today or is there a go date?
Simon Birmingham: The airlines will no doubt in terms of encouraging Australians to make the bookings, be releasing them in different bursts and waves, and indeed we will be renegotiating throughout this programme to make sure that the routes that are supported in the regions that are supported are targeting those regions to fill up their beds and to get people there when they need it most. So it will come in different waves at different times. And people should just expect to see the airlines who have a big incentive to sell these seats out there, marketing and promoting them hard.
David Bevan: Minister, thanks for your time.
Simon Birmingham: Thank you. My pleasure.