Senator the Hon. Simon Birmingham
Minister for Finance
Leader of the Government in the Senate
Senator for South Australia
Date: Wednesday, 12 May 2021
Nadia Mitsopoulos: Good morning, Minister.
Simon Birmingham: Good morning, Nadia. Good to be with you.
Nadia Mitsopoulos: Now you're expecting deficits for the next 10 years. Net debt is expected to peak at nearly a trillion dollars in 2025. Where are the hard calls on how to pay off that debt? Or are you just going to leave that for the next generation to figure out?
Simon Birmingham: Well, we're still in the middle of a global pandemic, you need only look, not only in a health sense of what's happening in India, but equally in an economic sense, that Europe sliding into a double dip recession, that we can't take anything for granted right now. And that's why this is a budget with a plan for our recovery. But the first step of that is to continue to keep the states safe from Covid, both in health sense and in an economic sense and so that's another 40 billion dollars worth of temporary measures in this budget to manage the pandemic. And that, of course, comes on top of the significant investments of JobKeeper and other supports along the way. But on the debt front, we have to be careful there, if you actually look at net debt over the next decade, we've managed to keep that lower than had been forecast in last year's budget. And so the strength of our recovery so far, the strength of Australia's economy has put us in a position where we're able to make the types of decisions we have in this budget to handle Covid, to grow our economy and to invest in services, but to still be able to keep those debt forecasts lower than had previously been the case.
Nadia Mitsopoulos: Okay, let's look at the issues of managing Covid and what is and isn't in this budget. Hotel quarantine, we know, is not fit for purpose. We've seen several outbreaks from hotels around the country. Your whole economic recovery relies on keeping the virus out of the community. So why is there no money in this budget for purpose-built quarantine facilities?
Simon Birmingham: So hotel quarantine has actually served the nation incredibly well. Ninety-nine point nine nine per cent of cases of Covid throughout the country have been able to be processed through hotel quarantine facilities as they bring returning Australians international travellers securely into the country. Yes, there have been a handful of instances of failures. There's no guarantee that any other system is going to be 100 per cent foolproof because issues of human error and so on will always be a risk factor. But we've indicated we will respond as we're looking carefully at the detailed Victorian proposal to establish some additional quarantine facility and capability in that state we’ll respond to that by looking constructively at those sorts of detailed proposals if they're brought forward by the states. And we have been expanding the facilities that were built up in Darwin, just outside at Howard Springs, and that's grown now to being able to process some 2000 arrivals per fortnight and will play appropriately the leading role in relation to repatriations from India when they restart after the 15th of May.
Nadia Mitsopoulos: And while hotel quarantine has served us well and we're not suggesting anything is foolproof, I do notice with interest that there's been no outbreak from Howard Springs. So surely some sort of purpose-built facility out of the city centres is better than what we've got now.
Simon Birmingham: But it's important to know Howard Springs is still easily accessible to Darwin. It's easily accessible in terms of the travel time, which means it's accessible to health services and other critical services, as well as a workforce to be able to support that sort of facility. And Victoria is the only state to have brought forward a detailed proposal to look at how they might expand their quarantine capabilities with some sort of additional facility. They gave it to us only a couple of weeks ago. And so we're working through those issues. There may well be a need to look at those sorts of possibilities. But in terms of keeping Australia safe from Covid, all Governments have done a mighty job. Our international border controls remain an essential part of that. We instigated them way back in February last year when we put in place the restrictions on China, we extended that to Italy to South Korea, to Iran and into the rest of the world and we will make sure we maintain those sorts of border controls as long as necessary to keep Australian safe.
Nadia Mitsopoulos: Senator Simon Birmingham is the Federal Finance Minister and my guest this morning. The budget assumes international borders might open mid next year and will depend on health advice. But there are industries crying out for skilled migrants right now. Can't get them. Local workers cannot bridge that gap. What is your plan to get skilled migrants into jobs where they desperately need it?
Simon Birmingham: You’re right there is a budget assumption there. It is just that an assumption to enable us to prepare the budget because we have to make certain assumptions around how things might unfold in relation to international borders. But we haven't made a government decision on that yet and we'll do that entirely driven by the health advice and how we best protect Australia from future Covid outbreaks. We want those international borders to reopen as soon as is possible, but no sooner than is safe to do so. And that will be the key determining factor for us.
Nadia Mitsopoulos: But the need is now, Minister.
Simon Birmingham: Well, the safety equation is not now, and that's why continuing to maintain tight controls, there are exemptions given where businesses can present a compelling case for skilled workers to come through or essential workers to come through and be able to fill roles in relation to those businesses. And they can work through the home affairs process to get those exemptions and they, of course, go through the type of quarantine circumstances we were just talking about. But we're also investing significantly in this budget to drive skills investment in Australia. Ideally, we want Australians filling job vacancies in Australia, and that's why we've got investment in digital economy strategy for more skilling in those high technology areas, investment in our aged care reforms to 38000 additional training places to meet the needs in the care sector there, investment in relation to apprenticeships for 100000 additional apprentice subsidies across the country to get more skilled Australians flowing through we’ve got 30000 more in higher enrolments in a university sector at present, it's all about making sure that we set up Australians to be best placed to fill as many jobs as possible.
Nadia Mitsopoulos: Just in regards to tourism, 275 million in the budget to keep tourism businesses afloat, which does sound like a drop in the ocean. And they're feeling a little abandoned. And certainly the situation here in WA, according to the Tourism Council of WA is that one in five tourism businesses that rely on international tourists may well fold.
Simon Birmingham: So our tourism industry is being supported by one point two billion dollar package of support across tourism and aviation. We've got more than 650000 discounted airline flights across Australia that have been subsidised by Government. And it sees Australians now crisscrossing the country in support of our tourism industry. What I'm getting from many tourism operators is, yes, there are some who are very internationally oriented who are still doing it tough, but there are others in the tourism industry who are seeing record levels of bookings and activity just at present as Australians are embracing the opportunity to holiday at home. And it's that holiday at home strategy that we have to continue to back and pursue whilst we keep international borders tight to prevent the spread of Covid into our country at present.
Nadia Mitsopoulos: Senator Simon Birmingham is my guest. We've got to let you go in a couple of minutes. I'll try and squeeze in another question or two, because I know you've got a whole list of a long list of interviews this morning. But one of the recommendations I noticed from the Aged Care Royal Commission was a Medicare style levy to make aged care funding sustainable into the future. But there is nothing about that in this budget. So the sector will keep having to fight for funding out of general revenue, and that worries them. Spoke to an aged care provider here in Perth this morning. They are very concerned about that and would like to know why you rejected that idea.
Simon Birmingham: Well, it was proposed by one of the Royal Commissioners, and it was actually not a proposal unanimously presented by the Royal Commission. We had competing recommendations in that regard. We don't think that now is the right time or that is the right time generally for Australians to face higher taxes, higher levies or charges. So we're in the midst of trying to drive an economic recovery, but we've stepped up nonetheless and invested seventeen point seven billion dollars over the forward estimates and ongoing spending projections and commitments in relation to aged care. And so the sector doesn't just have a couple of years of funding announced in this budget. There's an ongoing embedded increase in aged care funding. But it's not just about the dollars either the reforms are what will really matter to quality safety across the aged care sector. That's why we're embracing the Royal Commission report to mandate minimum time of personal care for residents in aged care. And so an individual residential aged care will get a minimum of 200 minutes per day per resident, of guaranteed skilled, trained care, at least 40 minutes of that on average by a registered nurse. And this is about making sure that the funding step up we have is backed by genuine, accountable, increasing care and quality that also has more funding for auditing the safety checks for reporting problems we've seen transparently of those providers.
Nadia Mitsopoulos: And Minister, we've been through all of that at that length before nine o'clock. The issue here, though, is about being able to sustain that funding down the track. And that is the concern. While this is all great for the next four or five years, it's what happens beyond that that has aged care providers worried
Simon Birmingham: The funding is embedded beyond the forward estimates of the budget. It's there in the medium term projections as well for aged care. Our Government has always been a low taxing Government. We're not one that that goes around putting new taxes or new levies [INDISTINCT]. And in this budget, indeed, we're delivering short term additional tax breaks to a significant number of Western Australians to support them through the Covid crisis. But we're also making sure that we deliver fully on our tax reform agenda, that will see income tax paid for most Australians at a rate no higher than 30 cents in the dollar under the types of reforms that we've been outlining. And we do this to make sure that in the end we're a competitive country and that people can work and know they get to keep enough of their dollars to plan for their future. But we have also in this budget, stepped up very significantly in terms of aged care, mental health, the NDIS, making sure these are programmes that are appropriately funded not just for a year or two, but for the future.
Nadia Mitsopoulos: I've got more questions, Minister, but I'm under pressure. I need to let you go. I appreciate your time this morning.
Simon Birmingham: Thanks so much, my pleasure Nadia.