Doorstop Interview
Parliament House
Canberra
9 May 2009
SUBJECTS: US Jobs; Changes to Announced Policies; Budget Speculation
TREASURER:
I think we've had a timely reminder this morning of the magnitude of the global recession. Overnight we've got the US job numbers which show that another half a million Americans lost their job in April. Their unemployment rate has jumped from 8.5 per cent to 8.9 per cent. Now, that is a stunning figure. There has been something like 5.7 million jobs lost in the United States since December 2007. If you think about that figure that is something like half the Australian workforce have lost their jobs in America since the beginning of the American recession.
I think it's a stunning reminder and a timely reminder as we do put the finishing touches on this Budget that despite our stronger job numbers we still have a very substantial employment challenge ahead of us. And I think what that does is it puts the onus on us to take the tough decisions in this Budget, to take the tough decisions to make room for pensions, to take the tough decisions to make room for the future investment that we require to maximise opportunities when growth finally returns, and to take the tough decisions to put the Budget on a long term sustainable basis.
Now, of course we will have to take hard decisions, hard decisions to support jobs, hard decisions to make sure we put that long term investment in place and to make the Budget sustainable over the long term. And of course if that means making changes to policies that we have previously announced, we accept full responsibility for those changes.
Now, one of the things that has made Australia so much better placed than the United States and other developed countries is that our Government moved early with swift and decisive action. And that swift and decisive action has supported employment in the Australian economy and we will need to continue to support that employment in the economy as we go forward in this Budget. But we're not on about popularity in this Budget. What we're on about is jobs and investment, and that will be the focus of the Budget on Tuesday night.
Over to you.
JOURNALIST:
Mr Swan, you've spoken about the employment challenge, you've also confirmed that pensioners are going be looked after in the Budget. Given that there could be a million people unemployed at some point in the next year or two, what are you going to do to help the unemployed in the Budget?
TREASURER:
Well, I have a series of announcements to make on Budget night, so I can't go into the ins and outs of Budget night. What I can do is to talk about the fundamental underpinnings of the Budget. And from day one as this global recession has washed over this country our number one priority has been to support employment in the Australian economy. And notwithstanding the better job figures we got through the week, there is still a need to support employment through economic stimulus. There is still a need to make the necessary investments in the productive capacity of the economy to support employment as we go forward. And that will be the focus of the Budget on Budget night.
JOURNALIST:
(inaudible) only going to support people that are unemployed as well?
TREASURER:
The Government has already made a series of announcements to support people who have unfortunately lost their jobs and have been retrenched.
JOURNALIST:
Treasurer, when you talk about unpopular decisions and taking full responsibility for the decisions that will be made, are you essentially saying that there will be broken promises?
TREASURER:
No what I'm saying is we have to take some very hard decisions in this Budget. Now, let's just look at the context. We've had revenue write-downs of something like $200 billion over the forward estimates – unprecedented in Australian history, unprecedented revenue write-downs. That means hard choices. And what we must do in the Budget is to create the room to provide economic stimulus now, but also for the longer term to put the Budget on a sustainable basis. We need to find the room in the Budget to support pensioners. We need to find the room in the Budget to put in place those vital nation building investments for the future. That does mean hard decisions and it may mean that there will be changes to previously announced policies and we accept full responsibility for that.
JOURNALIST:
Changes to policies, though, is simply a softer way of saying broken promises, isn't it?
TREASURER:
No changes to policy is something that has been brought about by the global recession. The world has been turned upside down since last September and we have to react to that in a responsible and measured way, and we're doing that.
JOURNALIST:
Mr Swan, in relation to infrastructure spending we read about this morning, what would that mean for jobs? And also, yesterday there was four-person fatality on the Nambour connection road. Will there be much money in there for black spot funding?
TREASURER:
Well, you know, I get up every day and I read the papers and I read the speculation about what may or may not be in the Budget, and some of it's accurate and some of it isn't. We'll find out on Budget night. But the Government has a very strong commitment right now to infrastructure. If you just look at our nation building and jobs program, the economic stimulus that's coming from that. Almost three-quarters of that is direct investment in schools and energy efficiency and social housing, and that's rolling out right now. There's going to be something like 35,000 projects across Australia over the next 18 months through those investments. That's a very big commitment to infrastructure.
JOURNALIST:
Treasurer, there were some positive signs out of the US jobless figures – the smallest monthly decline since October, the rate nothing like we saw in the 1930s. Do you agree that there are some positive signs in the international economy and for here in Australia?
TREASURER:
I think there are some encouraging signs but we have to be realistic about them and we can't overstate them. I've spent time recently with senior policymakers in the United States and I share their assessment that there are some early signs. But their view when I spoke directly to them was they should not be overstated, that the global economy still faces very substantial challenges. And what we must do is continue to put in place the economic stimulus that can bring recovery into the future. But to declare too early that this was over or that there wasn't a substantial challenge in itself would be a substantial problem for policymakers.
JOURNALIST:
There's also speculation this morning about changes to skilled migration?
TREASURER:
Well, there's no doubt that given the global outlook, the sensible thing to do in this environment is to calibrate and to change your migration policy, and the Government is realistic about that and you'll see what we've got to say about that on Budget night.
JOURNALIST:
Mr Swan, after working so hard and for so long on this Budget, it must deeply disappoint you to see those lists of accurate Budget speculation in the paper, things that are meant to be kept secret until Budget night. Will you be asking the AFP to investigate these leaks?
TREASURER:
Well, I think normal processes will apply here.
Thanks.
