TUESDAY, 5 MAY 2020
SUBJECTS: The impact of Coronavirus on the economy; Josh Frydenberg’s Press Club speech; JobKeeper; The Reserve Bank’s interest rate decision; Higher unemployment; Queensland Government; Schools; COVIDSafe App.
JIM CHALMERS, SHADOW TREASURER: Today we've had numbers released by the Reserve Bank, by the Federal Government and by the Bureau of Stats. These are incredibly confronting numbers. They are a very sobering reflection of just what the country is up against as we deal with the economic fallout from this devastating health crisis. Labor, as a Federal Opposition, has been constructive, responsible and supportive because the magnitude of what we're dealing with here, particularly when it comes to jobs, is a very confronting, very sobering reality and the numbers released today speak to that reality.
The Bureau of Stats says that in the month to mid-April, something like 7.5 per cent of jobs were lost, and wages were down 8.2 per cent in the same period. Every single one of those million jobs speaks to the enormity of this economic crisis. Every third job in food and accommodation was shed and every fourth job in the entertainment sector as well. These are the workers treated most shabbily by Scott Morrison's refusal to extend JobKeeper support to these workers. The worst job losses are in the industries which Scott Morrison and Josh Frydenberg have left out of JobKeeper and workers are being left to languish as a consequence.
Today at the Press Club, the Treasurer had the opportunity to do two things. He had the opportunity to explain just how much longer the unemployment queues would be as a consequence of him excluding so many workers from the wage subsidy program. And he had the opportunity to outline a plan for jobs, and for the economy, for when the otherwise-welcome support that's been injected into the economy is withdrawn by the Government. Unfortunately the Treasurer did neither of those things.
The unemployment queues in this country will be longer than necessary as a consequence of the Treasurer's refusal to extend that JobKeeper support to more casuals and to more workers. The problem with that is that the longer the unemployment queues are during the crisis, the longer it will take for our country to recover from the crisis as well.
As you know, Labor called for a wage subsidy program. We welcomed the Government's change of heart when they said that they would implement one. The JobKeeper wage subsidy is a good idea, which is being badly communicated, badly implemented and too many Australian workers are being excluded from it. These numbers today show that the industries left out and left to languish by Scott Morrison and Josh Frydenberg are precisely the industries where we are seeing the most dramatic job losses. This is something that Labor has been warning the Government about for some time now. In the food and accommodation sector, and the arts and entertainment sector, we are seeing every third job or every fourth job lost. The Government under Morrison and Frydenberg is leaving those workers to languish by excluding them deliberately from the JobKeeper wage subsidy program.
The speech that the Treasurer gave today is no substitute for a Budget. It's no substitute for a plan for jobs when this support in the economy is withdrawn by the Government. Everybody now recognizes and everybody now expects that unemployment will take longer to go down than it will take to spike in the next little while. Unfortunately for our country, our economy, and especially for the workforce of Australia this crisis is expected to have a long tail. The Reserve Bank says that the unemployment rate won't get back to what it was before the Coronavirus for some time now, perhaps a couple of years away. We need a plan from the Government to deal with unemployment which will be higher for longer. The Prime Minister says that things will just "snap back" to normal, but most people are sceptical that that will be the case when they see that so many workers have been left to languish. The unemployment queues are longer than they need to be because of the Government's pigheadedness when it comes to the design of the JobKeeper wage subsidy program.
The Reserve Bank has made a decision today to keep interest rates where they were. That was entirely expected. They've already taken decisive action to do their bit in the economy to support workers, employers and communities as we go through this incredibly difficult period. There is still a role for the Government to come up with a plan. The Reserve Bank will detail some of the scenarios that they expect and some of the figures which they are forecasting when they release their Statement on Monetary Policy on Friday of this week. The Government should follow suit and release much more detailed figures about what they expect from the economy in the coming months and years. No more of this practice of dribbling out one or two numbers at a time to the papers. What we need instead is a comprehensive broad-ranging budget update and plan. We need to see that sooner rather than later. Australians are petrified about what this crisis means for their jobs, for their families and their financial security and they're petrified about what this means for the future. We need the Government to outline a plan to deal with jobs now by including more people in JobKeeper and by outlining a plan for jobs once this otherwise-welcome support is withdrawn from the economy.
JOURNALIST: The stats suggested that those job losses were steepening towards the end of April. Do you fear it could be a lot worse than those numbers we've seen today?
CHALMERS: My fear is that there are job losses in the economy which could have been prevented. As I've said, the unemployment cues will be longer than they need to be because too many workers are being denied access to the JobKeeper wage subsidies. It remains to be seen whether unemployment has peaked already, or whether it will peak in the weeks and months to come. What is clear is that in crises like this it takes longer for unemployment to go down than it took unemployment to go up. The recovery when it comes will be patchy at best. There will be some industries doing better than others. The key here is to triage as many jobs as possible, so that when the time comes for the economy to recover we are starting from a stronger position than we would otherwise be in. The Treasurer was talking today about how important it is that we get people back to work. That's obviously the priority of everyone who's been following what's been happening in the economy. If you care about getting people back to work, you need to care about preventing job losses in the first place. The longer the unemployment queues are during this crisis, the longer it will take Australians to recover from this crisis. The focus of the Government needs to be including more people in the JobKeeper program and outlining a plan for when that JobKeeper support is withdrawn.
JOURNALIST: It's too late, isn't it, for many of those workers who've been excluded from the wage subsidies? I mean they're now stuck on unemployment. You can't undo that, can you, with the changes that you'd like to see?
CHALMERS: It's not too late for Josh Frydenberg to do the right thing. He can change the rules of the JobKeeper program with the stroke of a pen. He hasn't been prepared to do that except to exclude university staff and others from the program. It's not too late for him to do the right thing and include these workers who have been left to languish by the Government's decision to exclude them so far. I want to give you one more example. There are 5,500 aviation workers who've just found out this week that they no longer have a job. Those workers would ordinarily be eligible for the JobKeeper payments, but because their parent company is foreign-owned the Government has excluded them. So there are 5,500 Australian workers, working principally at airports, who will join those unemployment queues for no good reason when you consider that every cent of this wage subsidy is supposed to go to Australian workers to spend in the Australian economy. That is a stunning example of just how wrong this Government has got it when it comes to the JobKeeper subsidy. The Treasurer has the power to fix the rules, to close loopholes like that, to make sure that more people stay connected to their employer. He hasn't picked up his pen to do that and that means that the unemployment queues are longer than they need to be.
JOURNALIST: State Governments have a hand in the economic impacts, don't they? For example, in Queensland the lack of a communicated roadmap for some businesses reopening and keeping students away from schools perhaps longer than suggested by the Chief Medical Officer's advice?
CHALMERS: I think the State Government in Queensland's done a stunning, they’ve done a terrific job when it comes to managing this crisis. I think whether it's Annastacia Palaszczuk, Cameron Dick on the manufacturing front, the Health Minister Steven Miles, Jackie Trad the Treasurer, I think there's been a lot of good work done here in the best State in the Commonwealth and they should be congratulated for that. When it comes to schools in Queensland, I speak from the perspective of a dad of a kid who's in Prep. He's going back on Monday and he's very excited about that I can tell you. What the Prime Minister has made clear is that the timing of the return to school is a matter for the Premiers and Chief Ministers. The Premier of Queensland has decided on a staged return to school based on the best advice available to her and I think that's a good thing. The problems that have arisen when it comes to the return to school have actually been that since Scott Morrison said that it was up to the States to determine, he's spent much of that time along with his Education Minister, sending mixed messages and picking fights with the states about the decisions that they've taken based on the best advice available to them. Parents are going through a stressful enough time as it is without getting these mixed messages from Canberra. The Prime Minister was right in the first instance to say it's a matter for the States and Territories to determine. Having said that, he shouldn't be getting in the way of that. States are making the best decisions they can by weighing up all of their considerations. They are complex and they're doing the best they can.
JOURNALIST: What about a more concrete roadmap for hospitality businesses, for example, hard hit, for reopening?
CHALMERS: I think in every State and Territory and certainly at the Commonwealth level, there is a need for a plan for how we unwind some of these restrictions which have been so far very successful in limiting the spread of this virus. We need to acknowledge that Australians have come together in remarkable ways to deal with what's happening here. The restrictions have been part of that. They've meant that there have been some very difficult economic consequences, but the first priority of any Government is to save lives, and Australians and their Governments have largely done a good job at that to this point. As we start to think about unwinding some of those restrictions and as we factor in the impact on people's health, the impact on their jobs, and the impact on their financial security, then Governments at all levels will need to have a plan for how that happens and they'll need to communicate that clearly.
JOURNALIST: Have you personally downloaded the COVIDSafe app?
CHALMERS: I have, I've downloaded the app and I've encouraged people close to me to do the same thing. Clearly people in the community have reservations about this sort of thing. We asked a lot of questions about the operation of the app. But I think in times like these, we do need to do what we can to make sure that if the virus does pop up in one community or another that we can trace it. That's the objective of the app, and we want to make sure that it works, and that it protects people's rights and privacy.
JOURNALIST: Last question Jim, unless there's anything else you have to add. On unemployment support payments, is it prudent to keep them double the previous amount?
CHALMERS: We've said all along that the old level of Newstart, what's now known as JobSeeker, was inadequate. It wasn't good for the economy and it wasn't good for an individual Australian to try and get by on $40 a day. We said that that was insufficient. It’s up to the Government now to determine what the level of JobSeeker is when the worst of this crisis has been seen off. No doubt they are considering that. We want it to be higher than it was before. Beyond that, without the advice of Treasury and other inputs that the Government has at its disposal, we won't be nominating a number in the near-term.
Thanks very much.