Jennifer Westacott interview with Laura Jayes, AM Agenda

Event: Jennifer Westacott interview with Laura Jayes, AM Agenda

Speakers: Laura Jayes, host AM Agenda; Jennifer Westacott, chief executive Business Council of Australia

Date: 3 May 2021

Topics: Childcare; federal budget; JobKeeper, international borders; vaccine rollout

E&OE

Laura Jayes, host Sky News: The government will cover 95 per cent of out-of-pocket expenses for families with one or more child in care. The Business Council of Australia has welcomed the move as a crucial step to fixing the barriers to women that face going back to work and these hurdles. Joining me now live is Jennifer Westacott, chief executive of the Business Council of Australia. Jennifer Westacott you were prodding the government in this direction just last week. You came up with a proposal of your own. How does this marry up with yours?

Jennifer Westacott, chief executive Business Council of Australia: Look it solves many of the same problems. It solves a cliff that we saw with this cap and it's lifted that cap. And it solves the problem of access, making it easier, making it more affordable particularly for low- and moderate-income earners. The government has based that around the number of children, but we had it based on income. I think it doesn't matter the model, what matters is that we have a serious investment to get women working, to make it easier to work, to make it easier to have that second child, to make it more affordable for low- and middle-income earners to get rid of that big cliff that was there that was a real disincentive for people to go and get extra hours to work, to have their kids. So it solves the same problem. The other point Laura is that the Treasurer has been really clear that this is an ongoing project, if you will, to get the childcare system working effectively to make sure that we're responsive to the needs of families as the workforce changes as we go through this long period of low population growth. So we're going to continue to work really constructively with the government on this, make sure we've got a scheme that's fit for purpose. But nobody should underestimate the importance of that announcement yesterday. $1.7 billion is a lot of money.

Laura: One thing that both sides of politics has not addressed though is the issue of childcare centres independently just putting their fees up. There doesn't seem to be any kind of control on that. Would you like to see a system in childcare that we see in healthcare premiums? Where basically they need to get permission or put a case to the government in order to put up fees every year?

Jennifer: Look I think it's a really interesting idea that you've got there. It's something that we need to work with the government on because whilst we've now solved the biggest set of problems with the announcement the government made yesterday, they are other things that have got to be solved. Quality, pricing, the pricing regime as you've talked about, the workforce, the training. We need to do that at the same time as we make it easier for people to get it and make it more affordable to access it. But you're absolutely right, we need to make sure that this doesn't trigger big price increases and maybe the suggestion you made is one that's really worth looking at.

Laura: Okay well just a suggestion there so we'll see how that goes. 

Jennifer: It's good one.

Laura: Thanks I appreciate that.

Jennifer: Going to go and do some work on that.

Laura: Okay please. We'll talk to you again about that then. Now let's talk about JobKeeper. Does this data out today that's been released by the Treasurer back up this claim that JobKeeper ended when it needed to at the right time? 

Jennifer: Absolutely. Look the labour market has bounced back so strongly. I think everyone has been a bit surprised by that - by the strength of the labour market. There's still a lot of people unemployed though. I think we shouldn't forget that but JobKeeper is not the way to solve that. The way to solve that is to get things going again. To lift restrictions. To gradually, carefully open up our international borders. To get more activity going in the economy to drive investment. That's the way to solve that remaining group of people who are unemployed. Because we shouldn't accept anything like the numbers of people who we've got living on JobSeeker. But we have always said, as you know, that the timetable for JobKeeper being withdrawn was right, it was starting to have this big distortionary effect and we needed to get the economy off life support and get the private sector doing the heavy lifting. That's what those figures show and obviously the budget needs to be geared towards getting more and more private sector activity happening. 

Laura: The budget is looking much healthier than Treasury predicted even just a month ago. What do you think the government should be doing with this extra cash?

Jennifer: Well obviously you don't just go spending extra cash because you still have a lot of debt there. And of course we live in a very uncertain world so all the assumptions if you think about these things over the medium to long term, all these assumptions about low interest rates need to be carefully thought through. So obviously you don't want to go on a cash splash. But clearly, the budget is going to have a big call on the aged care system off the back of the royal commission. We want to see obviously a lot of activity on skills. We've still got a big issue on how we retrain people more quickly. How they get these things called micro-credentials so that they can get the new jobs, the jobs that are going to require more skills. Childcare was one of the things we thought that had to be addressed and big hit of money there yesterday for that. I mean obviously, for us the big issue is still getting business investment going. We obviously would like to see the $5 billion cap on the expensing measures lifted so the bigger companies with the big balance sheets can do more investing and bring through more activity into the economy. But you know we need to be making sure that we're not going to austerity, but we do need to be prudent with money. We need to get off this big spending spree and make sure that every dollar we spend is a dollar that's going to create a job, create a new job, attract an industry or skill somebody up. That's the lens that we have to look at the budget here.

Laura: And we can't forget that we're still living in the kind of COVID bubble. I spoke to Dominic Perrottet the New South Wales Treasurer last week and he's called on the federal government to set targets for reopening Australia to the rest of the world in line with our vaccine rollout. He said we can't live in this hermit kingdom and the border closures are costing New South Wales $1.5 billion every month. Would you like to see those targets are well?

Jennifer: Well as you know we released a plan about that a month or so ago where we said exactly what he's saying. We stepped it out. We said as you get to certain milestones in the vaccine you should be signalling when we get to that point this will happen. So for example 1b when all the vulnerable people have been vaccinated - no more closing of state borders. Like that has to be a thing of the past, it should never have happened anyway but let's leave that to one side. No more state border closures. Lifting the caps on events. And then as you get into that stage two where the bulk of the population gets vaccinated - a signal from government that they are going to reopen aspects of the international travel. For example, returning Australians, international students, skilled workers, so that we can actually start to get out economy powering up even further. And obviously, as people have talked about, we call them vaccine corridors, people call them travel bubbles, where a country that has got a very low infection rate, very high vaccination rate, we open up international travel. Now at the same time, we have to continue to be vigilant on quarantine, on testing and tracing. We've got to be in this for the long haul but absolutely we now need a plan to reopen the economy, reopen our international borders carefully in line with the vaccine.

Laura: As we see the vaccine rollout in places like the US and the UK, I don't think Australians quite realise that they are opening up to the rest of the world slowly, but they are starting to do it. Here in Australia, we seem to be tightening control. What do you think about that?

Jennifer: Yep. I think you're spot on there. I think we've got to be careful that we don't do all of this incredible management of the virus and then take too long to get things going again because we're all going to be competing with these countries. We're all going to be competing for investment for capital, for students, for high skilled workers. So we can't lose the war if you will or lose the peace, maybe that's a better way for expressing it. You can't just take so long that we end up being a fortress that we take too long to get out and get those investments happening in Australia, get our international travel happening. Because we'll be poorer for that and we are in this very competitive landscape. So that's why I think the New South Wales Treasurer's call is right. That's what we've been calling for. The other point Laura is predictability. Like we need something that says to Qantas, Virgin, Jetstar, here's how you can start doing your schedules because their schedules are quite complicated, it takes six months to do. People need to know well if that's going to happen at this point then this will open up, now I can start planning for that. So we need to give a little bit more certainty about the planning that needs to be done.

Laura: Spot on Jennifer Westacott. Always a pleasure. Thanks so much for your time on the program.

Jennifer: You're very welcome, thank you.