26 September 2018
Transcript - #2018017, 2018

Interview with Luke Grant, Wake Up Australia, 2GB

Subjects: Final Budget Outcome; Australia Day; Treasury portfolio; Royal Commission into Financial Services sector.

LUKE GRANT:

The Federal Treasurer is a man called Josh Frydenberg, with whom we regularly converse and he's on the line. I should say, first time Treasurer, congratulations. How're you enjoying it?

JOSH FRYDENBERG:

Look, it's a big, an important job, but it's been a great pleasure working with the Prime Minister, Scott Morrison. As you said, he's had a very strong start. We know who our masters are – that is, they are the Australian people. And we will continue to work hard to deliver better outcomes for them every single day.

LUKE GRANT:

Music to my ears. These numbers are pretty good aren't they?

JOSH FRYDENBERG:

Look, these are a very strong endorsement of the Liberal and National Party economic plan. As you said in your introduction, our deficit is the lowest in a decade and what we have seen is 350,000 new jobs created over the year, more women coming into the workforce, more seniors coming into the workforce and importantly more young people getting a job.

And that is helping to improve or increase our receipts – the taxes that people pay from having a job, the increased company taxes are paid because companies are profitable and at the same time we have reduced our payments, particularly our welfare payments because more people are in jobs and need less income support from the government.

LUKE GRANT:

And we got some pretty encouraging news, did we not Josh, from some of these financial evaluators – if I can call them that – the organisations overseas that mark us a AAA+ or whatever. The indication was from those ratings agencies that they're pretty happy with the direction you've got this headed.

JOSH FRYDENBERG:

Well in recent days we've had Standard and Poor's, which together with Moody's and Fitch – one of the big three international credit rating agencies, reaffirmed Australia's AAA credit rating. And we're one of only 10 countries Luke, that has a AAA credit rating from the three agencies.

And this is again, a ringing endorsement of our strong economy; shows that our Budget is back on track; that we have paid, you know, paying down the debt that was left to us by the Labor Party and that we are growing the economy and creating new jobs.

And this AAA credit rating confirmation or reaffirmation from Moody's [sic] came off the back of our National Accounts numbers the week before, which showed that the Australian economy is growing faster than at any time since the mining boom in 2012 and faster than any G7 country and faster than the OECD average so it's a good sign for the Australian economy.

LUKE GRANT:

Yeah and look I guess Josh the reality of the debt and I notice your opposite number Chris Bowen came out today and said, you know, the Final Budget Outcome, the numbers are presented in such a way as to look much better than what they actually are.

And he went on to talk about how the debt has increased since you've been in power. But you and I remember well back to the first Coalition Budget post-Rudd, there was an attempt by Joe Hockey and Tony Abbott to do some pretty significant cutting because he wanted to get the Budget back on track, he wanted to make a hole in the deficit.

But voters don't have an appetite for that. It's all very well to say cut here, cut there, cut everywhere but people still expect their services, they still expect to have government to come to their aid if they need aid. It's not as easy as saying, oh you know, we'll cut this and then we'll cut that and then we're okay. It's a long process and it's partly because the voters demand that. Is that fair?

JOSH FRYDENBERG:

Well spending has to be responsible Luke and what we've done - and I give great credit to Scott Morrison as Treasurer and Mathias Cormann as Finance Minister – is that we've brought down our rate of spending growth to the lowest level in 50 years.

And we have reduced the number of people of working age on welfare to its lowest level in 25 years. And the result of these policies is that the economy is growing strongly and more than 100,000 young people got a job last year. And that is the greatest number since records were first kept.

Now you compare that to what the Labor Party did when they were in office. Peter Costello and John Howard bequeathed the Labor Party and particularly Kevin Rudd, a pristine balance sheet with zero government debt and money in the bank.

Labor started giving out cheques to dead people; they were only able to get through the Global Financial Crisis because it was a Liberal and National Government that left money in the bank and then we came to government inheriting all this Labor debt and a rate of spending growth which would've seen our debt reach $1 trillion if Labor had stayed in power.

We've reversed that tide and we've become very responsible while also providing increased funding for the essential services that your listeners need and expect namely health, education and disability support.

LUKE GRANT:

Yet you bring those under control or get the spending manageable and you go to the people and every second sentence that comes out of the opposition's mouth is – they've cut money from health or they've cut money from education.

It's tough to get the- what I'm trying to say is it's tough to get the budget under control because in the reality of the current body politic, the other mob are just throwing hand grenades at you every time you try to do something with the budget.

JOSH FRYDENBERG:

Well Luke, I think Australian people recognise that we are responsible economic managers and we can be trusted to deliver a growing economy.

Let's not forget what the Australian people will be confronted with at the next election – a Labor Party that is promising more than $200 billion in new taxes, more taxes on your income, more taxes on your small and medium sized business, more taxes on your retirement savings and more taxes on your property with their negative gearing hit.

Compared to what we are proposing, which is reduced taxes on your business and on your income and not punishing you for owning an investment property. That's the difference at the next election.

LUKE GRANT:

These figures, they appear to be, Treasurer, so strong that you might be in a position and I guess you probably can't answer this, but you might be in a position to be announcing a surplus ahead of where you otherwise thought you'd be?

JOSH FRYDENBERG:

Well we've said that the budget is on track to come back to balance in 2019-20 and that is a year earlier than expected. The accounts will be reconciled through the Mid-Year Economic and Fiscal Outlook, otherwise known as MYEFO, which will be delivered around December and that normally follows the December National Accounts period.

And then people will see that the economy continues to grow and it is in good shape and that we are being responsible. So we're not going to pre-empt those announcements come the end of the year, but the recent numbers that we're seeing both in this Final Budget Outcome for '17-18, in the recent National Accounts numbers and from Standard and Poor's reaffirming our AAA credit rating is all good news for your listeners.

LUKE GRANT:

Yeah, it certainly is. Quick one before you go? The PM yesterday floated the idea of Australia Day, don't touch it and he proved to us- see I love what you said at the start Josh. You said, you know, we're governing for the Australian people.

Well proof of that is making sure the things we love and hold dear aren't mucked around with. Australia Day is one of them. He stood tall, he said to the Byron Council, right, as a result of that stupid intervention, you now have lost the ability to conduct citizenship ceremonies and that's good.

But I thought, very cleverly and we've got to have the conversation, at the same time, he said now we can't ignore 60,000 years of history. So why wouldn't we? And they do, I think they have Martin Luther day, Martin Luther King Day in the U.S., why can't we at least have a conversation about the notion of a day for Indigenous commemorations, celebrations? Are you supportive of that? What's your take?

JOSH FRYDENBERG:

Absolutely, I think what the Prime Minister has done is sensibly defended Australia Day as it is and said that we shouldn't give in to those zealots who are saying "invasion day and therefore we should scrap it".

That's wrong. We should continue with Australia Day but at the same time, we should also recognise the wonderful contribution that our first Australians have made to our great country and celebrate those achievements. These are not mutually exclusive objectives and that is what the Prime Minister has indicated.

LUKE GRANT:

Yeah, I agree. Now do you get a bigger car, bigger office, more people? What happens when you get the Treasury portfolio?

JOSH FRYDENBERG:

Just a bit more work I think, Luke, is the answer. There is- there's plenty of good things to do in the portfolio, not least of which to sit through many budget meetings, National Security Committee meetings, a whole range of additional responsibilities.

But also being Deputy Leader of the Party is a great privilege. As you know, I am very proud of the Liberal Party's history.

LUKE GRANT:

Indeed.

JOSH FRYDENBERG:

And to serve as Scott Morrison's Deputy is a great honour and like I said, we've got plenty of work to do. We don't want too many weeks like we've seen in recent weeks, which were quite tumultuous for the parliamentary party.

We've drawn a line under that, we're getting on with governing and the fact that the Prime Minister in quick time has brought a resolution to the schools funding issue; has announced the Aged Care Royal Commission, which has been very well received; has thrown the book at those cowards who tried to disrupt our food supply chain by putting needles in strawberries and all the other things that he's done has shown that he's getting on with it, he's decisive and I'm right behind him.

LUKE GRANT:

The Royal Commission report hits your desk, I assume sometime around Friday. My own personal view having watched many of the sessions is, you – that is the elected – have been let down by the regulators who might've convinced you over time that they were across their brief, and clearly they weren't.

There was some shocking evidence around CommInsure a week or two back. How long after you get the interim report can we expect some action? Or is this just an interim report and that's all it will be?

JOSH FRYDENBERG:

It is an interim report with the final report due in February and as I've said previously if the Royal Commissioner wants the extra time, then the Government will favourably consider such a request. He has done an excellent job to date.

LUKE GRANT:

Yes.

JOSH FRYDENBERG:

He's been very professional and very focused in the hearing and I have to say, like other Australians, I'm appalled by the conduct that has been revealed.

Namely, fees for no-service; fees for dead peo- fees being charged to dead people; 300,000 alleged breaches of insurance laws while providing unsolicited products. This is not what we would expect from our financial services sector, from people who are in a position of trust and at the same time, you were right Luke, the regulators do have a case to answer because in many cases they were aware of this conduct and I am asking the questions as to why they didn't stamp it out and why they didn't hold those responsible accountable.

LUKE GRANT:

Always good to talk. Good luck, great start. An amazing time ahead and you haven't got a lot of time to make up the difference but something tells me you're both going to have a red-hot crack and that's all we can ask for. Good of you to give us some time Josh.

JOSH FRYDENBERG:

Always good to be with you Luke.