AUSTRALIA – ECONOMIC POLICY

Cheap gas to power recovery

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Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 4 : 20-May-20

Ensuring that the east coast has access to affordable gas will be part of the federal government’s strategy to boost the economy in the wake of the pandemic. The National COVID-19 Co-ordination Commission is looking at a range of options for reducing the domestic price of gas; chairman Nev Power says these could include building a pipeline from Western Australia’s offshore gas fields to Moomba in South Australia. He adds that another option could be to relocate energy-intensive manufacturing to WA, where gas prices are lower due to a domestic gas reserve.

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AUSTRALIA. NATIONAL COVID-19 COORDINATION COMMISSION

Green New Deal puts debt at 44pc of GDP

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Original article by Tom McIlroy
The Australian Financial Review – Page: 4 : 18-May-20

Greens leader Adam Bandt has called on the federal government to lead Australia out of the COVID-19 crisis with a bold economic plan. The Greens will outline the strategies it believes are needed for Australia to recover from COVID-19 on 18 May; its plans include the construction of 500,000 new public housing properties and $59 billion to be spent on sustainable infrastructure. The Greens would guarantee anyone under the age of 30 employment, a training place or free higher education, while they are calling for the current JobSeeker rate of $1,115 per fortnight to be retained.

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AUSTRALIAN GREENS

PM’s post-pandemic powerplay

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Original article by Simon Benson
The Australian – Page: 1 & 4 : 18-May-20

Prime Minister Scott Morrison has stressed the need for greater workplace flexibility in the post-coronavirus environment, in order to boost the economy and get people back to work. He says that employers, workers, unions and government must co-operate in delivering the reforms that are needed in the wake of the pandemic. Morrison is optimistic that the union movement will continue to work constructively with the government, although he does not have similar expectations from Labor. Morrison adds that the immediate priority is to ensure that Australia does not face a second wave of coronavirus infections as lockdown restrictions are eased.

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AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIAN LABOR PARTY

‘Australians know there is no money tree’: Treasurer

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Original article by Phillip Coorey
The Australian Financial Review – Page: 4 : 12-May-20

Treasurer Josh Frydenberg will use his economic statement on 12 May to stress that there must be a limit to the federal government’s stimulus and assistance schemes, and they must eventually be wound back. Treasury has estimated that the government’s three-stage strategy to re-open the economy by July will boost GDP by $9.4bn a month and generate 850,000 jobs. However, Frydenberg will emphasise that this is dependent on Australians continuing to observe social distancing and hygiene measures.

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AUSTRALIA. DEPT OF THE TREASURY

Fiscal stimulus is almost the world’s biggest

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Original article by Matthew Cranston
The Australian Financial Review – Page: 7 : 7-May-20

Analysis by BIS Oxford Economics shows that 46 advanced and emerging countries have spent a combined US8trn ($13trn) on direct stimulus measures in response to the coronavirus pandemic. Qatar tops the list, with its stimulus measures equating to 13 per cent of GDP; it is followed by Australia and Thailand, with stimulus worth 10.6 per cent and 8.9 per cent of GDP respectively. Gabriel Sterne of BIS Oxford Economics says Australia’s stimulus package was much bigger than the firm had expected, and he notes that the nation was in a strong fiscal position at the onset of the pandemic.

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BIS OXFORD ECONOMICS PTY LTD

Let’s get 1 million back to work

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Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 4 : 6-May-20

Prime Minister Scott Morrison says the national cabinet will set a target date of July for the majority of businesses to reopen. The states and territories will decide the exact timeline for businesses to resume trading, but retailers, cafes and restaurants are expected to be amongst the first to have coronavirus restrictions lifted. Morrison argues that while Australia has been successful in ‘flattening the curve’, the focus must now be on getting people back to work. Nev Power, who chairs the National COVID-19 Coordination Commission, notes that some sectors of the economy are better placed than others to resume trading.

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AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. NATIONAL COVID-19 COORDINATION COMMISSION

Budget impact may be lessened by quicker recovery

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Original article by Phillip Coorey
The Australian Financial Review – Page: 2 : 29-Apr-20

The federal government is hopeful that Australia’s success in containing the coronavirus will result in the JobKeeper wage subsidy scheme costing far less than the $130bn that has been budgeted. The government had expected about six million workers to access the payment; Treasury secretary Steven Kennedy has told a parliamentary inquiry that there have been 540,000 applications from employers to date, covering about 3.3 million workers. The cost of the JobSeeker package for the unemployed may also end up being less than forecast.

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AUSTRALIA. DEPT OF THE TREASURY

Budget updates to push growth agenda

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Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 4 : 28-Apr-20

The federal government will release a statement on the impact of the coronavirus on the domestic economy when parliament resumes in May. Amongst other things, it will outline how much the government has spent on stimulus measures to date. The Coalition also intends to release new economic forecasts in June, which take into account the likely future impact of the pandemic. Labor and former Treasury official Greg Smith have previously urged the government to release an economic update in the near-term, arguing that it is too long to wait until the Budget in October.

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AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY

Post-pandemic world a great chance to turbocharge growth

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Original article by Patrick Commins, Ewin Hannan
The Australian – Page: 1 & 6 : 24-Apr-20

Professor Ian Harper says Australia should pursue micro-economic reforms once the coronavirus pandemic abates. He argues that the priority should be on smaller regulatory changes that will boost productivity over the long-term, rather than wholesale reform. Amongst other things, Harper has proposed an overhaul of urban planning and zoning laws to ensure consistency across jurisdictions, and greater use of road user charges to combat traffic congestion as people begin to return to work. Harper chaired the federal government’s competition review in 2015.

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Stimulus package a big mistake, says Abbott’s former economist

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Original article by Adam Creighton
The Australian – Page: 6 : 23-Apr-20

The necessity of the federal government’s $194bn coronavirus stimulus package has been questioned by Andrew Stone, the chief economist of former prime minister Tony Abbott. Stone argues that the stimulus package – and the national lockdown – should be progressively wound back, given that the virus outbreak has not been as severe in Australia as had been feared. He has also criticised economists who have signed an open letter cautioning the federal government against easing lockdown restrictions too soon.

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