Josh Frydenberg says the Australian labour market has outperformed expectations but he has declined to make a new prediction on the outlook for unemployment until the May budget.
But he remains adamant the JobKeeper wage subsidy will end in March as planned, even though he concedes some regions in Australia are still doing it tough.
“There is a lot of uncertainty out there both domestically and globally and the job is far from done,” the treasurer told the ABC’s Insiders program on January 31.
He said 90 percent of Australians who lost their job last year are now back at work, which has seen the jobless rate fall to 6.6 percent.
“The labour market has outperformed expectations,” Frydenberg said.
Even so, he was reluctant to rule out the jobless rate reaching 7.5 percent in the March quarter as predicted in the mid-year budget review that was released in December.
“Let’s wait and see,” he said.
However, he was more definite that government debt would still reach $1 trillion.
“Yes. That is the trajectory we’re on because obviously we have made significant spending commitments,” the treasurer said.
He also reiterated JobKeeper’s days are numbered.
“Based on what we know today, there should be no expectation that JobKeeper will extend beyond the end of March. It was always a temporary program,” he said.
There have been calls from the tourism industry and the Queensland government to extend the JobKeeper program for a sector that has been hit hard by the COVID-19 pandemic, particularly in the absence of international travellers.
Frydenberg said the government has already put in place targeted programs for travel agents and airlines.
He said Treasury is analysing tourism industry data and Tourism Minister Dan Tehan is talking to industry leaders to consider what future targeted assistance may be required.
“But the key for the tourism sector in Australia is going to be consistency and clarity around border closures,” the treasurer said.
The government is entering into a $5 million, week-long tourism advertising blitz in an attempt to drive Australians to book domestic holidays to give the industry a much needed boost.
Shadow treasurer Jim Chalmers said the treasurer has shown a stupendous lack of understanding of the impact international border closures have had on workers and small business in places like Cairns.
“The treasurer should stop leaving these workers and small businesses in the dark, he should stop leaving them hanging, he should stop leaving them in the lurch,” Chalmers, a Queensland MP, told reporters.
“You don’t need to be Nostradamus to predict the impact of withdrawing support from the economy too soon.”
Frydenberg would also not commit to increasing the JobSeeker payment when the coronavirus supplement ends in March.
There are concerns this means the dole will return to $40 a day as it was under its old name of Newstart.
Frydenberg said the government will make decisions on this prior to the supplement ending in March.
Colin Brinsden in Canberra