E&OE TRANSCRIPT
RADIO INTERVIEW
ABC RADIO NATIONAL
FRIDAY, 10 JULY 2020
 
SUBJECTS: Australia-China Relationship; JobKeeper. 
 
HAMISH MACDONALD, HOST: Jim Chalmers is the Shadow Treasurer, good morning to you.
 
JIM CHALMERS, SHADOW TREASURER: Good morning Hamish.
 
MACDONALD: I'm not sure if you caught the end of that interview with the Deputy Prime Minister arguing that there’s not much unusual about the situation between Australia and China right now, do you accept that?
 
CHALMERS: The relationship between Australia and China is incredibly important, but it's complex, sometimes it is difficult, and the situation is changing. China's being more assertive and that makes things even more complex than they usually are, but they're really important to us and they're really important to the region. What we need to do is acknowledge where there are genuine differences between us and communicate them calmly and clearly.
 
MACDONALD: Labor is urging the Government to signal its plan for JobKeeper support payments as the September deadline looms. What are your estimates of the number of Australians that could be forced into unemployment, if those payments end come September?
 
CHALMERS: Nationally we're talking about something like 872,000 businesses and about 3.3 million workers who are currently relying on the JobKeeper payments. If you think about Victoria where there's obviously heightened difficulties at the moment because of those necessary new restrictions, even in Victoria alone it’s something like 245,000 businesses, almost a million workers, and we're talking about something like $1.4 billion a fortnight injected into the state economy which would disappear on that last weekend in September. What we're saying is this is the first recession in three decades; people are justifiably worried about losing their job and being left behind. There's lots of additional anxiety because of what's happening in Victoria and that anxiety is not just in Victoria. It’s important that Scott Morrison come clean on the future of JobKeeper. He's really got two choices here; he can either add to all the uncertainty that's out there or he can try and address it. By sitting on the JobKeeper review that he's had for weeks he's making the Government part of the problem rather than part of the solution.
 
MACDONALD: Is it fair to say that the Prime Minister needs to come clean on this? The Government is saying, very clearly we just heard it again from the Deputy Prime Minister, that there will be some ongoing form of support here that will be announced closer to the time. I mean the September deadline is still some way off.
 
CHALMERS: A couple of things about that Hamish. First of all, the end of September deadline was based on the Prime Minister's view that things would just snapback to normal by then, and clearly that's not going to happen. The Reserve Bank, Deloitte Access Economics and others have said that we'll have higher unemployment for longer and the economy will need support for longer as well, so we need to recognise that. The second point is the Government said that they would release the review into JobKeeper in June, along with a budget update towards the beginning of June.  Then because of the Eden-Monaro by-election, they pushed it back towards the end of July. The point that we're making, if you speak to businesses around Australia but especially in Victoria, and to workers, there's lots of uncertainty, lots of anxiety, people are worried about what's going to happen, into the future. The Government owes it to them to come clean on the future of JobKeeper so that people can plan.
 
MACDONALD: Can I just put it to you the situation is moving so quickly that it may be sensible for the Government to wait a little longer to declare what it intends to do. Three or four weeks ago, we may not have been talking about a specific package for hardship scenarios in Victoria. In another three or four weeks’ time it's entirely possible that we may have a similar situation in New South Wales to what we have in Victoria. Doesn't the Government need a bit of agility here to be able to respond to the specific events that occur?
 
CHALMERS: It's been clear for some time, even before the most recent outbreak and the necessary new restrictions, that it would be devastating for many businesses and workers and the broader economy if JobKeeper ends too soon. The unemployment queues are already long enough, we don't want them even longer. We don't want this to be a jobless recovery. It's been clear for some time that the Prime Minister's snapback is not going to happen. Some parts of the economy will recover quicker than others, but it will be patchy, and people are worried about the future. The Government needs to level with them. They've got the review into the JobKeeper program.  They've had it now for weeks; it's time to release it.
 
MACDONALD: What's your view about what shape support should take beyond September. Do you think there should be a hardship test? Do you think it should be sector specific or it should be geographically specific depending on where further lockdowns take place?
 
CHALMERS: I think what the Government needs to do is they need to work out how to better target the payments. Clearly some people who might have only been earning $100 or $200 a week are being overpaid, so there's an opportunity there to better target the payment. There might be an opportunity to taper the payment over a longer period as well. Those are the sorts of options that the Government should be considering, but they shouldn't be just turning off the tap at the end of September. That would send a lot of businesses and a lot of workers to the wall if they ended the program too soon.
 
MACDONALD: The numbers that you have obtained through Treasury gives some specific insight into what the impact will be of JobKeeper ending, Victoria is obviously of particular concern right now. What would be the impact?
 
CHALMERS: Well in Victoria 245,000 businesses, 933,000 workers and $1.4 billion injected into the economy of that state alone each fortnight would just all of a sudden end at the end of September. In my home state of Queensland, 171,000 businesses, 650,000 workers, almost a billion dollars a fortnight would disappear out of the economy. We would all love it Hamish if the economy snapped back to life in September as the Prime Minister said it would, but the reality is that it won't. There will be higher unemployment for longer. There is a need for support for longer. We need to be smart about that. The first step should be for the Government to release the JobKeeper review that they've had for weeks, so that we can engage with that constructively and responsibly as we have been doing throughout this first recession in three decades.
 
MACDONALD: Do you believe though that it's possible to keep streaming out JobKeeper endlessly? At what point would you say it's reasonable for JobKeeper to be to be brought to an end?
 
CHALMERS: Nobody's arguing for JobKeeper to continue forever. But nor should anyone be arguing that we pull JobKeeper out of the economy too soon. The first step is to see what the review says. Let's see what Treasury and others are advising the Government about the future of JobKeeper. Clearly at some point in the future some of this extraordinary support in the economy will end. But we need to be smart about that. We need to target it and taper it, we need to be responsive to economic conditions because the worst thing would be if the Government spent hundreds of billions of dollars and all they achieved is to move the main part of the problem from April to October. We don't want to see another spike in unemployment. Already 835,000 Australians joined the unemployment queues in the last two months alone and 600,000 people gave up looking for work so we've got a big problem with unemployment.
 
MACDONALD: Jim Chalmers I think that argument has been fairly clearly spelled out but can you articulate how an endpoint might be determined?
 
CHALMERS: Clearly some of the support that's in the economy, which Labor has been constructive about, supportive about, and voted for in the parliament, clearly some of it will be needed for some time and it needs to be responsive to the economic conditions. It maybe be at some future point when the private sector has recovered sufficiently, and the labour market has recovered sufficiently, that the Government can wind up some of this support but that is not the last weekend in September. That is abundantly clear to everybody except for the Government. There are too many businesses, too many workers, too many regional economies and state economies which are relying on JobKeeper. If the Government pulls it out too soon it would cruel the recovery before it even gathered pace.
 
MACDONALD: Jim Chalmers thank you very much.
 
CHALMERS: Thank you Hamish.