Treasurer Josh Frydenberg fires back at Annastacia Palaszczuk over JobKeeper
Annastacia Palaszczuk may be entitled to her own opinions but not her own facts when it comes to JobKeeker and economic support, writes Josh Frydenberg. VOTE IN OUR POLL
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Premier Annastacia Palaszczuk is entitled to her own opinions but not her own facts.
The reality is the Morrison Government has already delivered to Queenslanders more than three times the amount of economic support than the Palaszczuk Government has committed to.
In less than 12 months, the Federal Government has provided more than $28.5 billion in economic support to Queensland households and businesses, from Brisbane to Bundaberg, Toowoomba to Townsville and Cairns to Caboolture.
In contrast, the Premier has only committed to spend $8.8 billion across the next 4 and a half years.
OPINION: Josh Frydenberg out of touch with Queenslands, says Palaszczuk
In fact, the Queensland Government have provided the lowest level of economic support of any State or Territory Government at 2 per cent of Gross State Product (GSP).
This is a third of the average of the total amount announced by all states and territories.
While the Morrison Government has committed $251 billion, or 13 per cent of GDP, NSW has committed $46.7 billion or 7 per cent of GSP and Victoria has committed $44 billion or 9 per cent of GSP.
Unfortunately for Queenslanders, when it comes to the level of state government support, this is one State of Origin contest their government doesn’t win.
Incredibly, Queenslanders during COVID-19 have used more of their own savings through early access to super than what their state government has offered in total economic support.
Under the Morrison Government’s early release superannuation program Queenslanders have accessed $9.8 billion of their own money to support themselves through COVID-19, compared to the Premier’s promise of $8.8 billion in support.
The Morrison Government’s support has seen $15 billion in JobKeeper payments, $6.9 billion in cash flow boost payments to businesses and $4.3 billion in coronavirus supplement payments flow to Queensland businesses and households.
All of this has helped the Queensland economy recover from this once in a century pandemic as we moved from the first to the second phase of the JobKeeper program.
Around 470,000 individuals and 110,000 businesses in Queensland graduated from the first phase of the JobKeeper program by the end of the December quarter, representing a 64 per cent fall in the number of workers relying on the program.
These improvements were seen right across the state with 75 per cent of people graduating off JobKeeper in Wide Bay, 72 per cent in Townsville, 71 per cent in Mackay, Isaac and Whitsunday regions and 66 per cent in Sunshine Coast.
And as support through the JobKeeper program tapered, the Queensland economy added more than 40,000 jobs between September and January.
In fact, 224,000 jobs have been created in Queensland since the height of the economic crisis in May with employment levels now sitting higher than they were pre-pandemic.
More broadly, the economic recovery is well underway.
Private residential construction in Queensland increased 9.6 per cent in the December quarter and new loans for owner occupiers in Queensland have increased by 50 per cent over the year as house prices increase for a sixth straight month supported by the Morrison Government’s HomeBuilder program.
The Morrison Government knows that the transition will be tough for some businesses and workers.
But with improvements across the economy, it is a transition that can be managed and one that must be managed.
The economy-wide JobKeeper program was always designed to be temporary and must come to an end.
At an estimated cost of $90 billion, JobKeeper is already the largest spending program in our history and we must remember that every dollar spent is a dollar borrowed.
Treasury has made clear in their review of the JobKeeper program last year that the program has a number of key features that create perverse incentives that become particularly pronounced when the economy strengthens.
In the words of Treasury, JobKeeper as the economy recovers “dampens incentives to work, it hampers labour mobility and the reallocation of workers to more productive roles, and it keeps businesses afloat that would not be viable without ongoing support.”
It is why the next stage of the recovery needs to target those who require support, whilst not getting in the way of the broader economic recovery.
Any further targeted support needs to be proportionate, temporary and accompanied by a clear exit strategy.
These are the types of measures the Morrison Government is currently considering.
It is also important to remember that there is still around $100 billion of the $251 billion of committed Morrison Government support still to be delivered to households and businesses to support them in the recovery.
And while some of the $150 billion in support already delivered has been spent, much of it has bolstered household and business balance sheets.
Deposits today are more than $240 billion higher across the nation compared to this time last year.
These savings, together with record low interest rates, means that businesses and households are well placed to invest and consume as the recovery takes hold.
And although a number of programs are winding down, fiscal support will continue in the form of the JobMaker Hiring Credit, the JobTrainer Fund, the bringing forward of Personal Income Tax cuts, tax incentives for business investment and substantial infrastructure spending, including on Queensland’s Bruce Highway.
In fact, Treasury modelling shows that a projected 2.3 million taxpayers in Queensland will receive a personal income tax cut this year and 690,000 Queensland businesses will be eligible for business tax incentives, including temporary full expensing.
We stand ready to continue to support Queenslanders through this crisis, as we have done from the very start of this crisis.
No amount of grandstanding and petty politicking by the Queensland Premier will detract from the indisputable fact that when it comes to the economic response in Queensland, the Morrison Government has done the bulk of the heavy lifting.
Josh Frydenberg is the Federal Treasurer
Originally published as Treasurer Josh Frydenberg fires back at Annastacia Palaszczuk over JobKeeper
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