Transcript Sky News First Edition

LAURA JAYES
   
Minister, thank you for your time. First, I am sure you have been watching – 

MICHAEL MCCORMACK 

Good morning. 

LAURA JAYES 
  
– oil prices.  There have been some calls for Australia to boost its strategic reserve, would you encourage your Prime Minister, the Prime Minister Scott Morrison, your Government, to do, given it could really help out farmers, agriculture, really everyone? 

MICHAEL MCCORMACK 

Our Government needs no encouragement when it comes to these sorts of things and indeed, we want to make sure that we've got those fuel stocks for agriculture, for mining.  If there are two sectors which are going to help us through COVID-19, it is indeed those two and certainly they have continued unabated through this. Yes, it might have been a little bit of a slowdown and workforce continuity, of course, is something which has affected every industry. But, we've put measures in place to ensure that mining and agriculture, through this, can be its best self.  And I know that for our Ministers, David Littleproud and Keith Pitt, in agriculture and mining and resources respectively, they are working very hard.  And we've all discussed the fact that with the fuel price, the oil price so low, yes, that's exactly what we should be doing. 

LAURA JAYES 
  
Okay. Let's talk Virgin now.  The Government has resisted any kind of taxpayer-funded bailout here, but what is the Government's role then in helping Virgin, if it's not in a monetary sense, what can you do for it regulatory?

MICHAEL MCCORMACK 

Well, it is in a monetary sense and we have already put on the table $1.28 billion, including waiving Government fees. We've put in place a regional air route service which Virgin are taking part in.  We've put in place a capital city to capital city, taking in some of the regional major centres as well, which Virgin are also flying to.  We've put in an International Air Freight Mechanism flying Tassie salmon and West Australian lobster and Victorian lamb out to destinations in the Middle East and in Asia, which weren't perhaps even on the books before COVID-19, to take advantage of those opportunities.  

And we've of course, put in place repatriation flights through DFAT which Virgin are also taking part in and of course, we've put in $130 billion JobKeeper initiative which enables Virgin to take part in.  It's been difficult for Virgin.  It's been difficult for the entire aviation sector.  Nicholas Moore has been appointed to engage with the administrator, Deloitte and so that's the way forward.  Virgin have got 10 interested parties and you know, there's a lot of speculation about what will happen with Virgin but Paul Scurrah has made the brave decision to put them in voluntary administration. I know that Paul is committed to them having a future and so is the Government.  We want a second airline, a commercially viable airline, coming out of this, Laura. 

LAURA JAYES  
 
Depending on what Virgin looks like on the other side of this, you're obviously confident that there will be some semblance of Virgin Australia left. 

MICHAEL MCCORMACK 

Yes. 

LAURA JAYES   

But what can you do at a regulatory level to stop Qantas, I guess, using its market power to make life hard for Virgin?

MICHAEL MCCORMACK 

Well, the ACCC is always there.  The Australian Competition and Consumer Commission is always there to monitor these things and they do and of course, the Federal Government will ensure that that happens. 

LAURA JAYES   

Okay.  Any ideas about how that happens?  Just working with the ACCC, there wouldn't be going down any kind of path of price fixing, would there?

MICHAEL MCCORMACK 

Well, we want to make sure that airlines remain in a process where they aren't ripping off customers and that hasn't happened and certainly by having two commercially viable airlines, that won't happen.  And it won't happen irrespective of whatever takes place with voluntary administration and Virgin.  The ACCC will monitor these things.  The ACCC always does a good job in making sure that whatever the case might be, whether it's aviation or any other sector of the economy, that Australian consumers are not ripped off and we will make sure that happens. We will follow that process diligently and if we need to up the ante as far as this is concerned, then we will, rest assured. 

LAURA JAYES   

What might make it difficult for both Qantas and Virgin is that if companies like Swissport are really struggling at the moment, reports this morning that they're looking to lay off 80 per cent of their workforce even with JobKeeper, making these people redundant.  Is there anything the Government is looking at there in terms of a specific bailout?

MICHAEL MCCORMACK 

Well yes, I did receive that letter a couple of days ago and I'll certainly be having a look at the Swissport situation.  We need our baggage handlers, of course, we need all sectors of the aviation industry to get through this crisis.  And it's not just aviation, it's so many sectors of the economy that have been hard hit by what has been a health pandemic.  Of course, we’ve seen world-wide consequences from this health pandemic which has had such an effect on our economy.  But I was heartened in some way to hear the Reserve Bank Governor, Dr Philip Lowe, talking about the fact that there is a light at the end of this very dim tunnel at the moment.  

I'm delighted to see that we are doing our very best to ensure that very few people are losing their lives out of this.  It's hard because 74 families have lost a loved one and of course, our condolences and sympathies continue to go out to them.  It seems like an eternity ago, Laura, that James Kwan lost his life back on March 1 in Western Australia, the first casualty of this and subsequently to that we've had, of course, 73 more families hard hit by this. But when you compare what we've been able to achieve by Australians being their best selves and making sure that they self-isolate and social distance and compare what we've encountered and endured to what's been happening overseas, it's a vast difference.  And I think Australians can be very proud of what they've been able to achieve and the leadership shown by Prime Minister Scott Morrison. 

LAURA JAYES  
 
Minister, just quickly, you engage with many trade exposed companies, is their company tax rate too high, too uncompetitive?

MICHAEL MCCORMACK 

Well, the company tax rate is going down. It’s actually the lowest it's been since 1940 and we're on a trajectory down to 25% for 2021-22.  When we came into Government it was higher and we've said that we're going to push the tax rate down. We've done that. We've provided not only company tax relief but also tax relief to individuals as well.  We are a low taxing Government.  We will continue to be.  We will continue to strive for the best economic conditions through this process.  It's been very hard but we've put in place the measures, $320 billion of measures, to cushion our economy as best we can.  We've got the lowest tax rate for small business, particularly since 1940.  That's a big achievement and we'll continue to ensure that business can stay open. 

LAURA JAYES  
 
Okay.  Sounds like more work ahead.  Michael McCormack, thank you. 

MICHAEL MCCORMACK 

Thanks, Laura.

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