E&OE TRANSCRIPT
TV INTERVIEW
INSIDERS
SUNDAY, 22 MARCH 2020

SUBJECTS: Impact of Coronavirus on the economy; Wage subsidies; Early access superannuation; Labor's constructive approach; Schools.

DAVID SPEERS, INSIDERS: Jim Chalmers, welcome to the program. Firstly, has the Government consulted Labor over this economic rescue package and what would you like to see it include?

JIM CHALMERS, SHADOW TREASURER: Good morning, David. The Government's consultation has been minimal. On the health side there are regular briefings and that's appropriate. On the economic package I think there's capacity for the Government to engage much more than they have been. We have received briefings but typically well after announcements have been made. We want to make a constructive, responsible and supportive contribution here. That's been our approach all along. It's not business as usual in the economy or in the community, and nor should it be business as usual in politics. This is an extraordinary time. It requires us all to work together. There are opportunities for the Government to take a leaf out of the book of the banks, the Reserve Bank, the peak business groups, unions and others who have been very consultative and very engaged with the Opposition. One thing that Scott Morrison could consider is to put Anthony Albanese in the National Cabinet with the state Premiers. That would send a good signal to the country about us all working together but also Anthony would make a very valuable and constructive contribution to that. That's the Prime Minister's call and it's something he should consider.

SPEERS: All right. Well, in the absence of that, what would you like to see the package include? Tell us now.

CHALMERS: This is no time for half measures or for more delay. What we need to see is a premium put on urgency today when the Government announces this package. They've lost the capacity now to go early so we need them to go big, fast and jobs and incomes. If we see that today, and we hope to, then we will play a constructive and responsible role in expediting that through the Parliament.

SPEERS: Well, let's go through some of the specifics that we know. $25 billion will be available to small and medium sized businesses with payments of up to $100,000 per business if they keep staff on. Do you support that sort of approach?

CHALMERS: Obviously we're very supportive of additional assistance for small and medium sized businesses who are doing it extremely tough in the economy. As the Government contemplates more measures to contain the outbreak of the virus itself, things are going to get harder for business before they get easier. So obviously we support assistance for more small and medium sized businesses. We'll wait and see what they announce today in detail. One of the issues here that we need to be investigating and examining is whether or not there is an actual guarantee that the money that is being provided to these businesses will actually encourage them to keep workers on. As I understand it there doesn't seem to be that guarantee. There's no direct link between the assistance and keeping people on. That may be something that the Government can clarify later on. The other big issue here -

SPEERS: I'll jump in there. Just on what has been reported on this front and from what I understand, businesses will be able to keep in the business the tax they withhold for each employee. Would that not be a way of ensuring they are going to keep that employee on?

CHALMERS: It's a backwards looking measure on the tax that they've been paying on an employee. That's an issue but let's have that clarified later on. If the Government has a way to do that, then let's hear all about it. The other issue, just briefly David, and one that concerns me a great deal, it's not just the size of the package which matters but also the urgency of the package. Some of this assistance won't flow until the middle of next month. Some of the payments for individuals, for pensioners, won't flow for another week or so. I think there is a lack of urgency here. One of the constructive roles that we do want to play in the Opposition is to inject a sense of urgency where it's lacking or absent. If we are contemplating further measures to contain the outbreak then we need to be looking for ways to get this welcome relief into the hands of more workers, pensioners, families, and businesses and circulating throughout the economy ASAP because we can't afford more dithering and delay.

SPEERS: Would you prefer to go down the path of the British Government, the Boris Johnson model that's come out over the last couple of days? It basically is covering 80 per cent of workers’ wages. If a business keeps them on, the Government would cover 80 percent of their wages.

CHALMERS: Right around the world, and especially in the UK, Governments are looking at pretty extreme measures like that. I think there are real advantages in the UK model because it does maintain a relationship between an employer and their workers. I think it's something the Government should be looking at very closely because that could do a better job of maintaining that link. If we maintain the link between workers and their employers, then we give ourselves a better chance of recovering quickly after the virus has been contained.

SPEERS: Is one of the issues with that approach, though, fairness? That the taxpayer is essentially covering 80 percent of a higher income earner's wage than 80 percent of a lower income earner's wage?

CHALMERS: There are all kinds of issues to work through, obviously, David, in all of these sorts of measures. They are pretty extraordinary but these are extraordinary times, as we've all been saying for some time. If there are issues like that, they could be looked at. There might be ways to iron them out. The Government has two jobs here. Yes, to support the unemployed. That is absolutely crucial. But also to try and maintain that link between workers and businesses so that the business who has trained a worker, they might be a good worker and all of that, that they can hold onto them so that when the virus is contained, business can bounce back to life.

SPEERS: As I mentioned earlier, my understanding is the Government will also in today's package seek to allow workers or those who lose jobs to access their superannuation to get through this crisis. What do you think about that?

CHALMERS: That's my strong expectation too, David, that they'll make a change there but we don't know what that change looks like. There are obviously already hardship provisions in superannuation. It's not clear to us yet whether the Government intends to change that in a major way or not and whether they'll need legislation to do that or whether they'll just do that by regulation. If it was left up to us solely, we wouldn't go down that path. We think that there are other ways to support people who are doing it tough. We think early access to superannuation should be a last resort, not a first port of call. We also think that there are real issues with encouraging people to divest from super when the market's in the condition that it is now. It's not good for them, it's not good for the system more broadly and we don't want to create problems for people's retirement down the track. We wouldn't go down that path but let's see what they propose later on and we'll make our views known.

SPEERS: Okay. As you point out though, there are hardship provisions there already. You can access I think it's up to $10,000 if you lose your job and you're at risk of losing your home. If this is an extension of those hardship provisions - I mean, this is a crisis situation. Isn't there an argument that, you know, it's their money that people might want to access?

CHALMERS: I think that should be a last resort. David, I don't know what they're going to propose later today. It may be that they just change the waiting period, for example. If they do that, we'll have a look at it. We've been pretty clear, not just today but for the last few days. As speculation about this measure has been around, we've made it clear that this wouldn't be our preference. We wouldn't go down this path if it was us.

SPEERS: Yes, and I know what you're saying there. It's not something you would do, but can I get a sense - if this is what the Government puts up today, the package as a whole, is there any chance you're going to vote against it?

CHALMERS: Two parts to that, David. Firstly, we don't know if it needs legislation. There's a very strong prospect that it doesn't and that it won't be a Parliamentary vote. But if it does come to the Parliament, we've made it abundantly clear for weeks now that we won't be standing in the way of getting other kinds of support out to businesses, workers, pensioners, families and communities. The economy desperately needs that support. Our issue is getting it out the door [inaudible] and with sufficient urgency to make a difference.

SPEERS: You'll let the Government get on with it?

CHALMERS: That's the point we've been making for some time.

SPEERS: A bit of speculation that the Government - it says it's not its focus at the moment - but that it might down the track, looking at nationalising businesses in trouble, Virgin Airlines in particular. What would your position be on that?

CHALMERS: With a challenge of this magnitude, we need to consider all kinds of things that we wouldn't normally contemplate. The Government needs to have a broader plan for critical industries and as part of that they could consider some of these measures. I would anticipate that some of this work is going on behind closed doors. That would be appropriate in case the Government needs to pull that lever.

SPEERS: Now, do you think, Jim Chalmers, we are now headed for a recession?

CHALMERS: That's the very clear expectation of all of the commentators and all of the economists. I try to avoid getting into the prediction game. I don't think that's necessarily helpful. I think the main thing that would be helpful here is that we need to know what the Treasury thinks about this. We don't think the Government should go from December last year until October this year before we get some updated numbers on the Budget bottom line and their economic forecasts out of Treasury. One of the reasons that is a problem is because we don't want Australian businesses and the Australian community more broadly in the dark for 10 months about the state of the economy and the state of the Budget. We understand -

SPEERS: Well let's just clean that up. Are you saying they should be producing a Budget in May?

CHALMERS: Not a full Budget, David. We've made it clear that we understand there are significant workforce pressures in churning out a full Budget as we've understood it over recent years. But I don't think that they should prevent us seeing an updated, cut down set of forecasts and the Budget bottom line so that we can measure the success of these packages, and so that people can make decisions based on the best assessment of Treasury. We need to get that cut down release on the original Budget timetable. We understand the workforce pressures in Treasury, but there's an opportunity to do something here and they should do it. Also, David, they should be releasing updated numbers today with the second stimulus package. There's a precedent for that from when Labor did it in 2009.

SPEERS: If and when it is confirmed that we're in recession, will you seek to blame the Government at all for that?

CHALMERS: There'll be a time for assessing whether the Government did enough, fast enough. That time is not now. The time right now is for us to play a responsible and constructive role. There'll be lots of analysis down the track and it remains to be seen whether they've done enough, fast enough.

SPEERS: It's clear that the scale of what's happening around the world and here in Australia is beyond any Government's ability to stop.

CHALMERS: We've acknowledged that this is a massive challenge. It's a massive health challenge and a massive economic challenge. We've been acknowledging that for some time. I don't think anybody could fault the Labor Opposition for the way that we've approached this in a constructive manner. We'll continue to do that. There will be a time for analysis of what the Government's done and we'll make a contribution then.

SPEERS: My point is you wouldn't be able to stop a recession happening right now, would you?

CHALMERS: It remains to be seen, David. We don't know what the Treasury thinks about the current state of the economy. We don't know whether what's being proposed is enough. It's a hypothetical question that we can't answer and it's probably not the highest priority to answer. The highest priority for us is to play our role in getting this stimulus out the door as soon as possible so it can do some good in the economy.

SPEERS: A couple of quick ones. Do you think schools should be shut down?

CHALMERS: As a dad, David, and I know you are too and you've got school aged kids, it's something you think about almost constantly. Obviously we're not privy to exactly the same advice that's coming to the Government on this. We welcome the clearer communication that's come to parents on this about school closures. The point that we make is if we are heading in that direction, or if there is a possibility at some point of a broader lockdown, then we need to be prepared for it. The Government needs to have a plan for critical workers, for health workers, for childcare workers in the system. We need to be ready for a situation where parents are at home with their kids and all of the consequences that that brings, especially for those parents who can't be home with kids because they're looking after the rest of us.

SPEERS: Just finally then, I guess a personal reflection. You mentioned the kids there. I mean, this is impacting on everyone's work life and family life as well. What has it meant for you?

CHALMERS: I think it makes all of us reflect, David, on our own situation and also the situation the country finds itself in. If we didn't fully appreciate and recognise the central role of grandparents in our economy and our society, we certainly recognise that now. Grandparents are the unsung heroes of our economy and our communities. My mum looks after my kids every weekday. Laura's parents are up from Adelaide helping out when they can. We did a trial of what it looks like without my mum last week for a few days and it was mayhem like it would be in a lot of households as we try and make it work. We're going to separate my kids from their Nan for a while which is very hard on the kids and very hard on Nan as well. But like a lot of families, we're just trying to do what we can here to do the right thing by each other and by the community more broadly. Everyone's making those sorts of decisions right now.

SPEERS: Everyone going through some tough family decisions on that front. Jim Chalmers, thanks for joining us.

CHALMERS: Thank you, David.

ENDS