Treasurer Josh Frydenberg talks ‘jobs, jobs, jobs’, but admits reality grim

More people will lose their jobs as businesses hit the wall in coming months as emergency government spending is redirected, Josh Frydenberg­ ­has warned.

Treasurer Josh Frydenberg at Parliament House in Canberra last month. Picture: NCA NewsWire / Gary Ramage

More people will lose their jobs as businesses hit the wall in coming months as the COVID recession bites and emergency government spending is redirected, Josh Frydenberg­ ­has warned.

But the Treasurer says the economy and families will be in a much better place a year from now, as personal income tax cuts, more spending on health, aged care and infrastructure, new business investment incentives and industry assistance fire up demand and employment growth.

In an interview with The Weekend Australian, Mr Frydenberg said Tuesday’s budget would zero in on the “here and now” of household finances and shattered business confidence. He said tax cuts for families and small businesses would quickly change sentiment, especially on investment, a key plank to future growth and economic dynamism.

“We’ve been very upfront that we will give every support we can to small business to get to the other side, but some won’t. Some jobs won’t be there on the other side of COVID,’’ he said.

“What you’ll see in the budget is it focus on jobs, jobs, jobs. It reflect­ the reality that we’re facing higher unemployment, we are facing thousands of businesses … in trouble, we are facing a very ­uncertain global and domestic economic environment.

“The lesson from previous recessions is … it takes many, many years to get those jobs back. So our focus and the budget’s focus is on giving us as a nation the best possible chance of getting those jobs back as quickly as possible”.

Mr Frydenberg said in a year “our economy will be stronger, more people will be back in work and our plan for the economic recover­y will be well under way”.

The JobKeeper wage subsidy, cut this week from $1500 to $1200 a fortnight, had been critical in keeping workers connected to employers. The number of people who reported having their hours reduced to zero hours plunged from 720,000 in April to 150,000.

The Treasurer said the focus of the budget was the “here and now” and on improving the lives of families immediately. He said more spending would be flowing to young people and seniors, aged-care and health services, the reskilling of displaced workers and the bringing forward of infrastructure.

Echoing Reserve Bank governor Philip Lowe, Mr Frydenberg said the private sector, responsible for nine out of 10 jobs, was the key. “We need businesses big and small feeling confident about the economic environment so that they can innovate, invest, grow and hire more people,” he said.

But containing the spread of COVID-19 was vital.

“The speed and trajectory of the economic recovery is very dependen­t on successful suppression of the virus,” Mr Frydenberg said.