Senate debates

Thursday, 12 November 2020


COVID-19: Income Support Payments

4:31 pm

Photo of David VanDavid Van (Victoria, Liberal Party) Share this | Hansard source

I thank Senator Gallagher for bringing forward this motion. It gives us the opportunity on this side to highlight exactly what we have been doing during this pandemic, because it's clear those on the other side don't pay attention to anything that we do. I think that's quite selective on their part, as are the selective quotes that Senator Gallagher has used in her motion; she grabs a few little bits that she somehow thinks are going to support this argument that we're not doing enough for Australians.

Well, nothing is further from the truth. It is absolutely true that the pandemic is a once-in-a-century shock. It is placing immense pressure on health systems and economies not just here in Australia but right around the world. The Australian economy has outperformed most other countries in both health outcomes and economic outcomes right through this crisis. The evolution of the public health crisis shaped the very recovery trajectory for both Australia and the world. The IMF said that it is expecting that the global economy will contract by 4½ per cent this year. This compares to a fall of 0.1 per cent in 2009 during the GFC. Australia's economy contracted by seven per cent in the June quarter. We know that. But, by comparison, there were falls of around 12 per cent in New Zealand, 14 per cent in France and around 20 per cent in the United Kingdom. Real GDP is expected to fall 3¾ per cent in the calendar year 2020 but grow—I say that again: grow—by 4¼ per cent in calendar year 2021. I'm happy to repeat that if any senators would like me to. It's clear that this outlook compares favourably with a forecast fall of 12.8 per cent in Spain, 10.6 per cent in Italy, 9.8 per cent in France, 9.8 per cent in the United Kingdom, 7.1 per cent in Canada and 6.1 per cent in New Zealand. Clearly, Australia is doing the right things, and they are working.

However, events in Victoria have been a major setback, because the state represents one quarter of the national economy. Treasury estimates that the imposition of stage 3 and 4 restrictions in Victoria through the September quarter will take two per percentage points off GDP growth. Why is that? Let's look at the mishandling of the pandemic in Victoria. Not only did Premier Andrews let the disease out of hotel quarantine, he brought in some people who I think were called 'security guards', but they provided little security and did little to guard those people in there. Remember, quarantine is a tool used to keep the disease away from the population. That is its only job—to keep the disease away from the greater population.

There was that major failure by the Andrews government, for reasons their inquiry probably won't even let us Victorians know. And why is that? Because no-one can recall—not the ministers, not the chief of staff, not the bureaucrats that have been thrown under the bus and certainly not the Premier. But he is the one who says, 'Hey, I'm responsible for all this.' When is he going to take responsibility for all that? Why did a lockdown that he said would take six weeks take 14 weeks? There's a simple answer to that. It's because they did not have contact tracing in place.

If you're looking at a public health system and you've got a virus that can spread quickly, what do you need to do? You keep it out of the population. There's a cross against that one; they didn't do that. What do you do next? You have to stop it spreading through the population. What do you use to do that? You use testing and contact tracing, both of which are things that the Victorian government didn't have in place until probably well and truly six or eight weeks into lockdown. Why did it take so long for lockdown to work? They hadn't got their contact tracing working. Why did they end up getting their tracing working? Because our Treasurer, the member for Kooyong, and the Minister for Health, the member for Flinders, Greg Hunt, called on them to do so. There was no movement. The Victorian government was saying to everyone at the daily press conference, 'Our contact tracing is world class.' World-class fax machines? World-class pen and paper? It was an utter, utter failure on any level. The Victorian public health system failed terribly. That brought about an immense cost.

Senator Walsh, who spoke before me, was saying she gets all these calls. I get a dozen calls a day from constituents, mostly small-business people, as I was before having the honour of being elected to this place. Those small businesses said to me all the way through stage 3: 'I survived stage 3. I got through stage 3.' But stage 4 crushed their business, as it went on and on—their desperation, the cries of anguish over what they were going through. They will acknowledge that JobKeeper kept food on their family's table, but there was nothing from the state government to help them pay their rent or keep the electricity on. There was one tiny little handout six weeks ago or so.

Premier Andrews is standing up there every day, saying, 'I'm going to deliver so much largesse in this budget, people will just look at me in wonder.' Well, they're looking at him and wondering why they haven't seen him do anything for the Victorian economy right through this whole mess. He's still standing there. No-one knows when this budget's coming, and small businesses are being absolutely crushed by his failures in public health policy and in not letting them know when help might come.

We have been helping people. We've been helping them with JobKeeper and JobSeeker, and the new JobMaker hiring credit will help enormously. The government's total economic support, since the onset of the coronavirus, totals—let me check this, because I find it really quite staggering—$507 billion. That's 25.6 per cent of GDP in overall economic support. So how can those opposite say that we haven't been doing enough? I find it absolutely amazing.

The Reserve Bank governor, Governor Lowe, said only recently—and this flies in the face of Senator Gallagher's motion:

… the government's strategy is the right one, through the combination of income transfers, incentives to the private sector and direct job creation—that together is going to get people into jobs …

The governor said it would be completely incorrect to draw the conclusion that this is 'a judgement on the government's fiscal strategy'. He said:

… the government is on the right track …

I now refer to some spending by the government in Victoria, which is aimed at trying to help those Victorians crushed by Premier Andrews's poor performance on public health. Around $35.2 billion has been credited to Victorians, with approximately 312,000 Victorian organisations receiving JobKeeper payments totalling about $20.8 billion. And that was as at 4 November, so the amounts will now have gone up. These organisations cover around 1.1 million employees and eligible business participants. The Morrison government has delivered $8.6 billion in cashflow boost credits paid to over 208,000 Victorian entities. Turning to the coronavirus supplement, $3.9 billion has been paid out to Victorians, with 572,000 Victorians currently receiving the supplement. Victorians have received $2.3 billion in the form of the $750 payment under both the JobKeeper and JobSeeker schemes, with 1.8 million Victorians receiving at least one of those payments. These figures show that we have been doing a lot.

Senator Gallagher's motion refers to insolvencies. I have received many phone calls from businesses that are fearful of going insolvent, but the Morrison government has done a lot to try to relieve some of their anxieties. The Morrison government will undertake the most significant reforms to Australia's insolvency framework in 30 years as part of its economic recovery plan to keep businesses in business and Australians in jobs. The reforms will help more small businesses to restructure and survive the economic impact of COVID-19. As the economy continues to recover, it will be critical that distressed businesses have the necessary flexibility either to restructure or to wind down their operations in an orderly manner.

These new measures, which are similar to the US 'chapter 11' bankruptcy processes, will help small businesses to restructure in a way that means not all their assets are going to insolvency practices. These measures mean that they can keep control of their businesses through this period, because they know best whether they are going to be able to get through it. With the advice and the support of an insolvency practitioner, they can restructure in a way that helps their creditors get what's due to them whilst the businesses keep going. Having been a small-business owner, I know it is incredibly important to have the sort of support from the government that gives you the ability to flexibly and in a controlled way look after your business, get it through the tough times and make sure it comes out the other side.

Despite the allegations of those opposite, the Australian economy is fighting back, with 450,000 jobs created in the last four months, beating all market expectations, and more than half of the number of jobs lost at the onset of the pandemic already recovered. It's good to acknowledge that 60 per cent of these jobs have gone to women, while 40 per cent have gone to young people aged 15 to 24, a cohort that has always struggled with high unemployment during tough times. The Morrison government, through its budget, has done more than anyone else to support those people. Around 60 per cent of the 1.3 million people who lost their jobs or were stood down on zero hours are now back in work. In conclusion, the motion before us is nothing but an opportunity for opposition members to have another whinge, because they know that the Morrison government is doing more to help the Australian economy, more to help Australian workers, more to help Australian businesses, than they ever could.


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