Senator the Hon. Simon Birmingham
Minister for Finance
Leader of the Government in the Senate
Senator for South Australia
Date: Thursday, 25 March 2021
Scott Emerson: Simon Birmingham, he is the senator and also the minister for finance in the federal government, and he joins me on the line now. Minister, thank you for being on Facebook Drive.
Simon Birmingham: G'Day Scott, thanks for the opportunity to chat once again.
Scott Emerson: Now, Minister JobKeeper has been remarkably successful. I think anyone looking back over the last 12 months would not think that the Australian economy and the unemployment rate down to five point eight per cent would be anywhere near where we are now. Given what we've seen with code and what we've seen overseas. So JobKeeper has been successful, but it is coming to an end and a lot of people are worried about what will happen when it doesn't.
Simon Birmingham: I can absolutely understand those concerns, Scott, but you're right, JobKeeper has been very successful. It's also been very expensive. It is the single largest intervention in the Australian economy by an Australian government. And it is essentially all debt funded it at this time of o major economic crisis around the world and the fact that we are running a very, very big budget deficit in this year. But JobKeeper has, according to the Reserve Bank, saved some 700,000 jobs. It saved so many businesses from going under who would have failed and faced administration or insolvency because of the cost of redundancy payments and the like. If we hadn't had a programme like JobKeeper in place and it's helped provide the springboard for our economic recovery and what we see across Australia right now is that there are more people in jobs as of the last set of employment data than there were back in March of last year. And that's a remarkable turnaround when you think about the fact that in other parts of the world, they're still locking down and shutting down parts of their economy. They're still dealing with COVID spiralling out of control and their economies are still going backwards in some cases. We at least are in a circumstance where we're safe and secure and we've got jobs back above the level that they were at in March last year. But I know the end of JobKeeper will cause concern and is causing concern in some businesses, in some individuals and so their households. But want I'd reassure people of is we're rolling out new targeted programs, support for tourism and aviation sector in a one point two dollars billion package, support for the arts and entertainment sector in a new 135 million dollar package. This is about now targeting those sectors that we know still face difficulty and pressures whilst letting the rest of the economy get back to a state of normality that the nation can better afford.
Scott Emerson: Look, I can't argue with the numbers you've talked about there in terms of how many people are now back in work, how many jobs and possibly businesses have been saved. But as you say, JobKeeper is going to end. It was expensive. But what's your expectation now when JobKeeper does end and I look at next week. Well, I suddenly see a whole raft of businesses suddenly shutting their doors because JobKeeper has finished.
Simon Birmingham: A couple of things they got and we had a remarkable effect last year where actually there were fewer insolvencies, fewer business failures in 2020 than there had been in 2019, or that the normal average would be significantly fewer, in fact. So will there be some business failures to come as JobKeeper and other support measures come off? Yes, and probably what we should acknowledge is that is that programmes like this designed for an emergency, artificially propped up some businesses that probably would not have ordinarily survived, because we always have some businesses that fail and new businesses that emerge. And that's the nature of an economy. And the same can be said in relation to jobs, that the Treasury advice is that they think there might be around 100 to 150,000 people across Australia who may be impacted by the end of JobKeeper. But they also point out that in the normal course of events prior to COVID and the pandemic hitting, in any single month, we would have around 400,000 Australians who would leave one job and start another job, who would often see job losses in some businesses and job gains in other businesses. And so what we have to keep doing is ensuring that the businesses who are growing right now who are putting on more staff and have got us back to this point of having employment above March 2020 levels, continue to grow, continue to create more opportunities to be able to absorb some of those whose jobs are not viable and may not have been viable, even if not COVID.
Scott Emerson: But, Minister, are you saying that some of the businesses I'm sure there'll be many a media story next week and the week after about a business that has failed is saying that some of those that we do see close their doors would have closed the doors and have been propped up over the last 12 months because of JobKeeper and without JobKeeper and without COVID, they would have failed anyway.
All of the data says it's the case that that for some I'm not saying for all of those who may close or face difficulties, but for some they would have probably closed anyway, that the JobKeeper and the other small business payments and economic support we provided did help to probably prop up certain businesses that had we had the normal sort of flow of insolvencies and business failures that you see every year across the dynamic economy. We would have had more of those last year ended up being the case. But I'd also stress there are significant other supports still there, not only the targeted packages in tourism, aviation, arts, entertainment I spoke about before, but also we've put in place a highly concessional loans program where businesses can refinance and save themselves money compared to their existing loan arrangements and get themselves through the tough times. And that is a way to help those who were previously profitable businesses to stay afloat. Similarly, we have tax measures in place where if they're making a loss this year, they can deduct that against past year's profits and get money back to help the business stay afloat. And right across the economy are bringing forward income tax cuts for Australians, putting more than one billion dollars extra per month into the pockets of Australian households to underpin spending and activity across the economy.
Scott Emerson: Now, you cited those Treasury figures before, about possibly up to 150,000 jobs impacted by the ending of JobKeeper. Do you expect that a lot of those within those sectors he did mention that tourism sector, the arts sector, those sectors, they're still struggling horribly from the impact of COVID and that rather than just across the board?
Simon Birmingham: There may well be some and there will be some who are in the supply chains that supports some of those sectors. But equally, there will be some in some of the bigger cities that that may not have had everybody come back to work and reactivated, as well as other cities. And I think the state government's acting on the health advice. We'll have to look carefully and closely at ensuring that as the whole country now enjoys a relatively high degree of success in terms of having no community transmission, no outbreaks right across the country. And we hope, touch wood, that continues. That government and business look at reactivating those CBD centres, particularly in the big cities. We have seen some cities of Australia well and truly back to normal and their economies, their JobKeeper numbers have been showing a real normalisation. And we hope that others can follow suit in that regard.
Scott Emerson: Now I'm talking to the minister of finance, Simon Birmingham. Minister, a lot of speculation now about a cabinet reshuffle. Talk about that Christian Porter won't be attorney general after the reshuffle. Linda Reynolds won't be defence minister. When do you expect that reshuffle to be announced?
Simon Birmingham: Well, reshuffle is in cabinet and ministerial arrangements are always matters for the Prime Minister. He makes those calls, as does any prime minister. It's well known he's been taking advice in relation to potential conflicts of interest that arise from the Attorney-General, pursuing defamation action and making sure that there can be no potential or perceived conflicts in that regard. So I'm sure the PM will look carefully at that advice. And if he thinks there need to be changes as a result of it, he'll make them.
Scott Emerson: Why hasn't been a great couple of weeks for the federal government. Does a reshuffle, is it needed to really reset the government in the public's mind at least?
Simon Birmingham: What I want to say to your listeners and to the public are really two things. Many of the issues that have been raised over the last few weeks, there are terrible, terrible instances that highlight the terrible role that the sexual assault plays in destroying the lives of too many people across Australia. There are the very genuine concerns around sexual harassment and bullying that have been highlighted by individuals and rightly championed by Australian women, and we take all of those issues seriously. And the government is focussed on making sure that we hear those messages and act in response to them, both in cleaning up areas of bad culture or practice in the parliament, which should set an example for the nation and be a best practice workplace. And that is absolutely what we're striving for, but also acting more generally across the economy. But the other thing I want to reassure your listeners of is that the management of COVID, the management of our economy, the response to the floods that have been affecting parts of Australia, all of those issues equally remain at the forefront of the government. And that whilst there's been lots of questions, lots of media commentary about the different serious issues over recent weeks, it certainly hasn't stopped us from continuing to focus on rolling out new support packages. As I said, tourism and aviation today, arts and entertainment in making sure that we're planning for a budget that will respond to the aged care royal commission, as well as to continue our economic recovery, in getting this week, getting underway the Australian manufacturing of vaccines. And we're one of one of only a few countries in the world who are actually making vaccines here in our own country to ensure our own supply of them. And so we are seeking to make sure we keep the eyes firmly on the ball that Australians expect us to do in terms of their safety, their security, their wellbeing, but without any way underplaying the severity of the need to act on the other issues that have dominated headlines so much lately.
Scott Emerson: Simon Birmingham, thank you for joining us on 4BC Drive.
Simon Birmingham: Thank you, Scott. Thanks for the opportunity.