Transcripts → 2021


4BC - Drive with Spencer Howson

Senator the Hon. Simon Birmingham
Minister for Finance
Leader of the Government in the Senate
Senator for South Australia


Date: Friday, 16 April 2021

Economic recovery; International borders; Economic future

Spencer Howson:  Simon Birmingham is the Federal Minister for Finance and he joins me now. Simon Birmingham, welcome to 4BC Drive.

Simon Birmingham: Hello, Spencer. Great to be with you.

Spencer Howson: These unemployment figures, the unemployment rate continues to fall. How promising are the latest figures?

Simon Birmingham: They're very, very encouraging. What we're seeing is that the Australian economy continues to outperform all expectations, the expectations our own agencies have set, the Treasury, the Reserve Bank, the expectations of international organisations, the OECD, the IMF, on all these fronts, the Australian economy is recovering faster, more strongly from COVID than people had anticipated and indeed recovering faster and more strongly than most other comparable nations around the world. And whilst that's great in terms of economic data and very good in terms of the strength right across many businesses, most importantly, it manifests itself in jobs for Australians. And that's where we're seeing the fact that we've got more people back in work working more hours and a stronger level of participation in the labour force than we've had back at the time prior to the commencement of COVID is really a very encouraging situation and one we hope continues.

Spencer Howson: From a Queensland point of view. Would these numbers be even better if they hadn't been small outbreaks and snap lockdowns in this state?

Simon Birmingham: Well, it's certainly every outbreak presents a risk and a risk to public health and the risk to the economy as well. And so obviously, we all need to be mindful of that and the possibilities of it. But ultimately, our governments across the country - you know we're proud at the federal level of the role that border controls internationally have played in keeping COVID out of Australia and governments across the board with the testing tracing system, isolating arrangements have managed very clearly to be able to create an environment where the health situation is safe enough that we can keep the economy open and performing. And what we want to see is for that open economy to stay as strong as possible for state governments working with us federally to keep the type of gains that we're seeing. You know, as we've shifted from the end of JobKeeper to more targeted forms of economic assistance, which some people question whether or not they work. But I see in the last couple of days, the heads of Qantas and Virgin both saying they're having some of the strongest booking times ever. And that bodes really well for the continued recovery of the economy, particularly in some of those most affected sectors.

Spencer Howson: I'll come back to the disappearance of JobKeeper, but because, of course, these figures are to the end of March and then JobKeeper disappeared at that point. But Queensland and WA are leading the way in terms of additional jobs we were dragging behind. But now we're leading the pack WA because of a recovery in mining Queensland, because of migration to Queensland. Does this also show that the Queensland government has done a very good job of dealing with COVID over the last 12 months?

Simon Birmingham: I think the results right across the country, every single state and territory and shown really strong economic recovery, really strong jobs growth and recovery. And that's a testament to the national effort, in our system of government there are the moments of tension that exist between federal and state governments. But in the end, the proof is in the pudding. And here what we are seeing is that businesses have bounced back, jobs have bounced back. And [indistinct] compare it against situations right around the rest of the world where other countries are banking shutdowns, lockdowns, where you're having something like 500,000 new cases of COVID being reported every day around the world on average through the course of this year. And that's creating a circumstance where you've just got, of course, so much extra pressure on the economy because of those lockdowns and shutdowns. And here in Australia, we're avoiding that. We've been able to suppress the spread of COVID flow, but keep people safe and healthy, but also keep businesses secure and jobs more secure. And that's the successful factor that we have going for us and what we need to continue to protect.

Spencer Howson: Ok, so these are. This is good news. Unemployment's falling, but this did coincide with the end of JobKeeper at the end of March. So do you expect the April figures to be less rosy?

Simon Birmingham: We're not expecting that it will be a completely linear every single step of the way trajectory where we improve each and every month. There is the risk of bumps along the way. But it's important to know that Treasury estimates, the Reserve Bank estimates are that unemployment will continue to trend down. JobKeeper was the single biggest intervention in the Australian economy. It come at a huge cost to the federal budget and indeed costing around two billion dollars a month still at the final stages. But it was a very successful program that we put in place to get businesses through right across the country. The toughest time we've transitioned now to those more targeted programmes focussing on the aviation sector, the tourism industry, the entertainment industry, those sectors that are still doing it tough under certain circumstances, well, under some of the uncertainty that exists around international travel or domestic travel. And so in that sense, we've made sure we've put the focus where it needs to be. We have confidence that we will continue to see unemployment trend down and jobs continue to be created. But we can't guarantee month to month that there may not be the odd bump in statistics as we continue to deal with what are very uncertain international circumstances and those uncertain circumstances translate into Australia as well.

Spencer Howson: Just finally, I'm so pleased that I'm able to ask you this question, Simon Birmingham, as the federal finance minister, because it's something I've been wondering for a few weeks, and I've raised the question on 4BC a few times, how do we pay back JobKeeper and everything else that has that the the nation has had to spend just to keep things going over the last 12 months? Is there going to be whether it be this year or the end of the next financial year or the next financial year, they're going to be like a covid levy. Should we be preparing for that when we come to pay our taxes over the next couple of years? How do we get the money back?

Simon Birmingham: I think that people shouldn't be expecting that at this stage, our focus is firmly on continuing to strengthen the economy and you don't strengthen the economy by putting new taxes in place. You strengthen the economy by encouraging businesses and people to invest and to create more jobs and to create from that more taxpayers. You know what got us into a position at the start of COVID, where the Australian budget had debt relatively low, compared the rest of the world was coming back into balance, which was striking compared to much of the rest of the world. And that was achieved by virtue of the strong economy that brought welfare dependency rates to their lowest level because we had record numbers of people in jobs that we created around one point six million jobs that the government since our election in 2013. And the virtuous cycle of that you've got more people in jobs, more taxpayers, less people on welfare, less payments needed to come out of government through Centrelink and so forth. And that very much is our focus now for the recovery, how we continue that relentless pursuit of economic growth and jobs growth, knowing that that will put us on a more sustainable footing. Of course, we would best not to have had to incur the debt we have through this COVID crisis, but it will only compound the problems if in future we lay higher taxes on the Australian economy. We've got to do is grow the economy faster than that debt, and that can put us in the strength of a stronger position. And we're still well placed because relative to most other developed nations, our debt profile, our debt to GDP, the deficit that we're running are modest compared to many other nations.

Spencer Howson: All right. Thanks for coming on the program this afternoon. I appreciate your time.

Simon Birmingham: My pleasure. Any time.


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Authorised by Senator the Hon Simon Birmingham, South Australia.