Daily Bulletin

Business Mentor


  • Written by Scott Morrison

LEIGH SALES: Prime Minister, thanks for your time. 


PRIME MINISTER: Thank you Leigh.


SALES: You’re shifting JobSeeker and JobKeeper to lower amounts, why would you pull any money out of the economy during what will be one of the worst recessions in a century? 


PRIME MINISTER: Well, it's important to note that the existing payments as they’ve been running now for some months will run out till the end of September. At that point, it will move to the next phase. Now, I think Australians understand that running, say, JobKeeper at $11 billion dollars a month is not something that's sustainable. These are much elevated payments. The nature of how things are unfolding is changing. And quite a number of businesses now are coming up above that 30 per cent downturn threshold. And so it was always the plan to to stage us out of this to make sure that we could be tapering off as things improve. And it's our intention to ensure that things do improve. But the nature of these payments and the way they're designed is they flow towards where the need is greatest. They’re an automatic stabiliser, if you like. And that's what we've been doing now for many months, putting that automatic shock absorber in to cushion that blow as I said some months ago.


SALES: You mentioned it goes to where it's needed the most. Universities don't qualify for JobKeeper and universities are putting off thousands of workers across the country. Why doesn't the government put the same value on a job in a university as a job in a cafe or a shop? 


PRIME MINISTER: Well, we do. I mean, the university sector is the only sector that receives that the single largest or most support through our guarantee of student placements. On top of that, they are organisations with very large reserves in the billions. Their CEOs are paid multi-million dollar salaries. They're not unlike large corporates and for large corporates to qualify for this programme they've had to have a 50 per cent downturn in revenue. So we're applying the same test, Leigh.


SALES: Universities are also one of Australia's biggest export industries. They contribute innumerable direct and indirect benefits to the economy. They've taken a big hit because of the inability to have foreign students travelling here. Surely that's a case that they do deserve JobKeeper, they hire a lot of Australians?


PRIME MINISTER: Well, the test is whether they’ve had a 50 per cent fall in revenue. That's what's applied to other large organisations. I mean, universities, I think we should remember, these are very large organisations with billion dollar reserves and they've got multi-million dollar CEOs and they're making decisions about how they're running their own organisations, just like many large businesses are going through this. Now JobKeeper only applies to those large businesses where they've had a 50 per cent fall in their turnover and the reason for that is because they're expected to draw on their reserves. So those private companies are doing that. Now universities get income support, revenue support through the guarantee of places which we've continued to provide, regardless of whether those domestic places are filled. Certainly they have their challenges with the international market. We'll be doing what we can to try and restore that. But universities are just not getting a special deal Leigh.


SALES: The arts, if we can take the arts film, TV, books, music that has really sustained people a lot during the lockdown, that sector contributes billions to the Australian economy and they employ 600,000 people, fewer than half of whom are eligible for JobKeeper. Again, why are their jobs valued less? 


PRIME MINISTER: That’s not true.


SALES: Well it is, if you are somebody who works in the arts-


PRIME MINISTER: No, I'm sorry-


SALES: Because the nature of your job, the nature of your job in the arts usually means you don't have one employer. 


PRIME MINISTER: The eligibility that sits there for JobKeeper and the companies that are involved in the entertainment sector means that those employees have been and the number of employees and employees who've worked in the arts sector who say JobKeeper has been an absolute lifeline to them Leigh and on top of that-


SALES: That’s the thing. A lot of people in the arts sector don't work for companies. They're freelancers. 


PRIME MINISTER: And that's why JobSeeker is there also to support them as it has. See, I see JobSeeker and JobKeeper working together, but recognising the significant impact in the entertainment sector that's why we put the $250 million dollar support package in. That's why we've put the $400 million support for films. I was just announcing that just on the weekend. We understand that there are sectors that are being hit harder than others. So whether it's in entertainment or in film, just yesterday I was meeting with those in the business events sector who have also been hit hard. The aviation sector is another one. All areas where we've provided additional supports because of the structural nature of the problems that they face.


SALES: Even your political opponents accept that JobKeeper has been a crucial lifeline for the economy. So take that as a given. But there have been flaws, notably the waste in the overpayment of part time workers and that $60 billion dollar accounting error. If labor in power had made those errors, the Coalition would be screaming absolutely bloody murder about economic mismanagement. 


PRIME MINISTER: Well, I'm not interested in the politics Leigh, but let me address the point you made about the payments that were made to people who were part time and who were long term casuals. Now, we had to move these payments quickly and we deliberately put in place a payment that was flat across all employees. Otherwise, we wouldn't have been able to direct payments to people on lower hours and we would have had to exclude them and we didn't want to do that. But the other point is it ignores the fact - and this was in the JobKeeper review, that 39 per cent of those jobs lost were for people who had second jobs and third jobs. So they'd lost those jobs. They weren't getting JobKeeper payments for those jobs. So we made sure JobKeeper was just paid through one employer and that made up for the income that they might have got from other jobs. So it would be wrong, I think, to make that analysis and that analysis which Labor have made, I think, betrays a lack of understanding about the challenge at the time and the way that people work.


SALES: Given the state of the economy and given that interest rates will be functionally zero for the indefinite future, do you accept that there is no urgency to pay down debt or return the budget to surplus by slashing government spending that it would, in fact, be detrimental to the economy? 


PRIME MINISTER: Well, you've always got to be careful with government expenditure, and you’ve always got to spend it wisely. It's certainly not an invitation for inefficiency. It's certainly not an invitation to treat taxpayers money carelessly. And we’re not doing any of that-


SALES: No, no sorry to interrupt, Prime Minister. But the point I'm trying to get to is that we're not going to see next year you saying that we're slashing government spending so we can get debt paid down in a rapid fashion?


PRIME MINISTER: Well, I made this very clear several weeks ago. Months ago, in fact. I said we have a number of goals here, and that is to provide the economic support that is necessary to ensure the Australian economy can emerge out of this COVID-19 recession that we guarantee the essential services that Australians rely on. We remain committed to the National Disability Insurance Scheme, our record aged care funding, our record schools funding, our record hospitals funding,  we remain committed to all of those things - 


SALES: So does that mean you’ll be keeping those commitments high and not looking for areas to slash government spending in the short to medium term? 


PRIME MINISTER: We'll be keeping our commitments, Leigh. That's what we'll be doing. And we've made those commitments budget after budget. And we’ll be keeping those commitments-


SALES: Sorry to keep interrupting. I'm just trying to get to a first principles issue here, which is do you accept that the state of the economy at the moment is going to require debt for a long time and government spending to remain high to prop it up? 


PRIME MINISTER: Well, it requires the Australian government to provide the supports that are necessary. And that's what we're doing. We provided temporary income supports. We've provided one off payments to those on welfare benefits to stimulate the economy. We're providing underwriting support for people to get their products into market by underwriting airfreight. We're providing incentives and loans and grants and tax arrangements for businesses to invest. We're supporting concessional loans both through the banking system and directly. And we haven't forgotten about those who were affected by drought and we haven't forgotten about those who are affected by bushfires. We continue to roll those commitments out at record levels as well. So, Leigh, we will continue to do what Australians are asking of us. And I think one of the things we've done as a government is we've been responding to that and we've done it with a lot of discipline, respecting taxpayers’ dollars, but with a lot of compassion to ensure that the needs are met. 


SALES: If we can turn to the health side of the pandemic, the public keeps being told that we have to learn to live with COVID, when authorities say that, is the logical conclusion that you're saying that we have to be prepared to live with a particular number of cases and therefore a number of deaths? 


PRIME MINISTER: No, I don't think that's what it means. And we've been pursuing a suppression strategy, some would say a very aggressive suppression strategy. And in seven states and territories and not that long ago in Victoria, that had proved to be very successful. But in a world where the pandemic is running rife, then you cannot assume that in all cases that you are going to be able to prevent cases appearing. Now what we’ve seen in Victoria-


SALES: So what’s living with COVID look like then? What’s living with COVID going to look like?


PRIME MINISTER: It means keeping the discipline, it means keeping the discipline, keeping the distancing, keeping your registration on the COVIDSafe app. It means working through all of the disciplines that are necessary. It means keeping your health system’s supports in place. It means maintaining your contact tracing capabilities, maintaining the testing regime. It will mean for some period of time, certainly in Victoria and potentially in other states where there are outbreaks, the wearing of masks. It means that it hasn't gone anywhere and we can't live like it has.


SALES: With this aggressive suppression strategy doesn't Victoria illustrate the real difficulty with that is that you are relying on infallible competence from leaders at every level and you're relying on every individual doing the right thing all the time, and that's impossible to achieve?


PRIME MINISTER: Well, what's the alternative Leigh? I mean, what we're doing is we're in uncharted waters. The whole world is, I mean, everyone is working together and learning together where there are mistakes that have been made, I think people have learnt from that. I mean, what we've learnt from things like Newmarch, for example, as we're dealing with the aged care challenges in Victoria at the moment, that's been very instructive, it's been very helpful, a key part of that is not just the health response in those aged case situations, but also the communications with families. Critically important, I mean Leigh, all leaders, all governments are seeking to work together, learn from each other and deal with what is a rapidly changing situation. And I think everyone's endeavouring to put their best foot forward. And that's what living with this is like and Australia I must stress, both economically and on the health front, is doing better than almost any other developed country in the world. 


SALES: The New South Wales Premier Gladys Berejiklian, is adamant at the moment that her state won't lock down. She says you can't keep opening and shutting it all the time. So if Sydney reported 376 cases in a single day like Melbourne did today, it wouldn't be in mass lockdown?


PRIME MINISTER: Well, you're making a number of assumptions there. I mean, you don't get to 376 overnight. And this is where I think the New South Wales government have moved incredibly quickly. They have the largest industrial scale tracing system in the country and they were able to move very quickly on that Crossroads outbreak and to be able to track that through incredibly fast and even in the cases they announced over the course of today, they all have all had known sources. And so this is what I'm mainly about, living with it. You've got to keep those tracing and public health response capabilities dealing with outbreaks up to match standard all the time-


SALES: In the case- 


PRIME MINISTER: What happened in Victoria is we had an outbreak from quarantine and that riddled through sections of the Melbourne community and it is now escalated to where it is today - 


SALES: Well on that point-


PRIME MINISTER: Commodore Hill is on the ground, the ADF support is in there - sorry.


SALES: Prime Minister, sorry. Can I ask, did Victoria do anything differently to the other states when it came to following the advice of the National Cabinet on how to run quarantine? 


PRIME MINISTER: Well all states and territories were running quarantine and they were responsible each and every state for running their quarantine. And there was clearly breaches in the Victorian quarantine- 


SALES: What I'm what I'm asking - 


PRIME MINISTER: The Victorian government has acknowledged that - 


SALES: Sorry Prime Minister. What I'm keen to know is, was the Victorian Premier Daniel Andrews, advised at the national cabinet to use police and military to run quarantine in Victoria and was that advice rejected? 


PRIME MINISTER: Well, certainly military were always available to all the states to run those services-


SALES: Was it the recommendation?


PRIME MINISTER: In New South Wales they were using police. In Victoria - No, well, we don't seek to micromanage how the states run their states. I mean, this is a federation and in the federation that works best where there's a respect for states to run their own shows in their own jurisdictions. And I got to tell you, the states are very protective of their own jurisdictions and and and being in charge of the decisions made in their own state. Now, of course, that means they're accountable for those things. And I believe they are. And they will take accountability for the decisions that they've made. Victoria had made some different decisions to New South Wales. 


SALES: You’ve previously said that the COVID app was the ticket to a COVIDSafe Australia. Today, no state or territory to point 730 to an instance where the app had located a close contact not already identified by manual traces. Is it time to bin that app and go for something more effective? 


PRIME MINISTER: No, that would be ridiculous. That would be dangerous. 


SALES: Well, I just told you no state can point to where it’s helped. 


PRIME MINISTER: No, but that's- what it does, is it works with the manual tracing. The two go together. I mean, there are hundreds and hundreds of cases that have been identified that have also been identified by the manual tracing. Now, in many parts of what we saw in Victoria, that app wasn't downloaded amongst many parts of that community. We're at about 40 per cent downloads across the potential population who can download that app. Now, that means there's 60 per cent of the population who hasn't, but at 40 per cent, that's one of the highest rates for an app of that sort in the world. And so it is an important safeguard. It is an important assistance and it is available. Now in many other states and territories they haven't had any cases for community transmission where it could have provided any role because you're able to track the source to a quarantine case or something of that nature. So I found the COVIDSafe sledges that have been coming just a little bit politically opportunistic. 


SALES: Have you worn a mask anywhere yet? 


PRIME MINISTER: I went to see an optometrist and I wore it for the consultation. 


SALES: And if you went to say, see the Sharks play a game, would you wear a mask now given what's happening? 


PRIME MINISTER: Well, that would all depend. I mean, the recommendation in New South Wales is if you are unable to have social distancing in place, then you should. And if that were the case, then I would. 


SALES: Just briefly on another matter. Australia's relationship with China. When did you last speak to President Xi Jinping? 


PRIME MINISTER: That would have been at the G20. 


SALES: Does Australia's new defence strategy, along with your recent language about China, the tearing up of the extradition treaty with Hong Kong signal a shift in thinking towards China, that we now clearly view it as a potential threat and as untrustworthy?


PRIME MINISTER: No, it signals that the Australian government will always be consistent with its values and its interests. And that's what we've always done. And we have taken no steps to seek to injure that relationship at all. In fact, our trade volumes are up, particularly in the resources sector at present. And so we will always just be consistently and that's all we've done and we'll continue to do that. 


SALES: Would the world-


PRIME MINISTER: The relationship is important and we have no intention of injuring it, but nor do we intend to do things that are contrary to our interests.


SALES: Would the world and the US be better off if Donald Trump lost the US presidential election?


PRIME MINISTER: It's a matter for the American people. I think it'd be highly presumptuous for an Australian Prime Minister to be engaged in that level of political commentary. It’s a bit of a strange question. 


SALES: Prime Minister, thanks for your time today. 


PRIME MINISTER: Thanks a lot Leigh.

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