ABC Radio National Breakfast 07/08/20

07 August 2020

SUBJECTS: JobKeeper changes; Business community.

SUBJECTS: JobKeeper changes; Business community.
GERALDINE DOOGUE, HOST: Jim Chalmers, good morning.
DOOGUE: When we last spoke to you, the Government had just committed to the extension and now we have the relaxation of the eligibility criteria still further. So this is going to give a lot more businesses and their employees, at considerable cost I might add, the confidence they need. Won't it do that?
CHALMERS: Certainly there's a lot of businesses and a lot of workers in Victoria, but also in other parts of the country, who are doing it incredibly tough. So the responsibility on all of us is to support what we responsibly can to look after those people and to try and prevent unemployment being too high for too long. We've been saying for some time, that the deterioration in the economy warrants the Government having another look at the JobKeeper changes that they made only a couple of weeks ago, they've done that now, it's a step in the right direction. But we still have some concerns that other elements of the JobKeeper changes are still in place and that they might come at the worst time for a lot of these workers and businesses. We still remain concerned that a lot of people are still left out of JobKeeper; casual workers, people in aviation, arts and entertainment -
DOOGUE: Universities too.
CHALMERS: And universities, of course. So we still maintain those concerns but to the extent that they've relaxed some of the eligibility criteria, that's a welcome step. But there are other things which troubled us in the changes that the Government announced -
DOOGUE: And easily fixed would you say? At what sort of cost? Have you tried to think that through?
CHALMERS: The Government obviously has control of all the numbers and the ability to cost these changes, they've said that this change will be about $15 billion. What we've said is that this is one element of the changes to the JobKeeper program that they announced a fortnight or so ago, but we know from talking to businesses, we know from talking with workers, that there are other changes being proposed for JobKeeper. The economy is worse now than what the Government anticipated it would be, they've admitted that in the last 24 hours or so. The Government needs to have a comprehensive look at all of the programs. Changing one part of eligibility for one program is not a comprehensive jobs plan. We really desperately need a jobs plan from the Government because something like 350,000 additional Australians between now and Christmas will lose their jobs.
DOOGUE: What would a comprehensive jobs plan look like? I mean, is it a different sensibility completely that you're foreshadowing now than what you're seeing from the Government?
CHALMERS: What we're saying is that this is one part of one program. It's good to see some of these eligibility rules relaxed but it's well short of what the Government needs to be coming to the table with. They had a big budget update a couple of weeks ago which was a missed opportunity not just to tell people how grim things are, people already know that, but to tell people what they're actually going to do about it. So what we've said is we need to consider it in three phases. We need to respond to the immediate crisis that's why JobKeeper is so important. We need to bolster the recovery with things like investing in social housing and other measures, but we also need to plan for jobs over the medium term and that means getting energy policy right, getting skills and training right and a whole range of other areas. What the Government's done here is a welcome step of sorts, but it's not that kind of comprehensive jobs plan that we need.
DOOGUE: Would you say that you would be prepared to go, would Labor be prepared to go, considerably more into deficit? I mean, this is already $15 billion, this is sort of what you would say almost like a tweaking, a good tweaking, but how much more into deficit would you be prepared to go to get that much more overarching plan that you're talking about?
CHALMERS: A couple of points about that Geraldine. Already deficits are the biggest they've ever been, already debt is heading towards a trillion dollars which is many multiples of what the Government inherited when government changed hands seven years ago. So we have to recognise that this is all borrowed money that needs to be paid back at some point. We need to get maximum bang for buck for this borrowed money, that's the first point. But your question about how much more would it cost, we need to consider that if we go into a long deeper downturn, if unemployment is much higher for much longer, then that will do massive damage to the budget as well. Deloitte Access Economics and others have made what I think is the reasonable point, which is that if you want to fix the budget you have to fix the economy. The Reserve Bank has said there's a bigger risk in doing too little than doing too much. We need to take that kind of expert advice on board.
DOOGUE: Yes, it's also people like the Business Council who have really started pushing for this 20 per cent investment allowance, because they say that if you really agree with the notion of favouring business to lead you out of this you need to encourage business to put in new capital. Now does that sort of thing appeal? Is that part of this idea that you're proposing?
CHALMERS: It does appeal Geraldine, we've said that for some time, we took a version of that to the last election and we said it's something that should be considered. Business' role in this recovery is really crucial. We've had an issue with business investment in the economy from well before this COVID-19 crisis, it's been very clear a lack of investment which has flowed from energy policy uncertainty and all kinds of other factors has been a handbrake on growth in the economy. We want to get businesses investing again, because when they do that means jobs and that's the most important priority that we can have as a country is where we find these new jobs as we come out of this first recession in 30 years.
DOOGUE: Now the other one that's much more tricky for Labor is IR reform because the Government wants to extend the emergency changes to the workplace rules which allowed employers who received wage subsidies to cut a workers hours and change their duties. Now, Labor does not favour this sort of flexibility? Am I right or are you changing your mind on that?
CHALMERS: We've been really constructive right along Geraldine when the Government's come to the table with some of these temporary changes we've done our best to be accommodating where that's possible but we've also raised concerns that we don't want this crisis to be an excuse to wind back wages and conditions for Australian workers. The answer to rampant job insecurity and underemployment is not more of the same. So we'd be very wary and very sceptical that making emergency and temporary measures permanent would be the right recipe to get the place growing again.
DOOGUE: Yet it is surprising the number of people who will intuitively say to you we can't keep the conditions necessarily that we have, given that the scale of the challenge. You rebut that?
CHALMERS: We're part of that conversation Geraldine and we talk with business about these things, we talk with the Government, we talk with the unions obviously as the workers‘ representatives, and we try and do the right thing, we try and do the responsible thing. Sometimes temporary measures and emergency measures are necessary, but what we don't want to see is a permanent wind back of wages and conditions for workers, where this crisis is used as some kind of excuse for the Government to do what they've long wanted to do. When Josh Frydenberg was talking about drawing inspiration on industrial relations from Margaret Thatcher, that would have sent a shiver down the spine of a lot of Australian workers. We don't want to see that kind of thing become permanent in Australia and that's why the Government shouldn't be using this crisis as excuse to do things that they've always wanted to do.
DOOGUE: There is an interesting thing though about what's happening in Victoria because I read the other day that a lot of business leaders said that they have, they don't really feel they know people in the Dan Andrews‘ Government and when they need to raise their hands about something that was happening in this recent process they went straight to the Federal Treasurer who is of course a Victorian, Josh Frydenberg. What is the message for Labor and broader labour out of this emerging from this crisis? I mean obviously the need to be closer to business, seems to be very important? Do you agree or not? You may not but I'd like to hear your thoughts.
CHALMERS: I do agree that we need to have a productive relationship with business. I spend the vast bulk of my time as the Shadow Treasurer engaging businesses of all sizes and their peak organisations. I think it's absolutely crucial that we do that because their role in this recovery will be absolutely central. We need to make sure that business can invest with confidence as we come out of this recession. We need to make sure that we're talking with them constantly about how we go about finding where there's common ground between workers, businesses and governments of all kinds and at all levels because for “all in this together” to be meaningful and not just a slogan, then we need to actually listen to each other and work together and see what we can do.
DOOGUE: All right, Jim Chalmers thank you very much indeed for joining us.
CHALMERS: Thank you Geraldine.