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James Cullen on Sky News First Edition: COVID-19 and the economy

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LAURA JAYES, HOST: Joining me now is James Cullen, Senior Director of Government Relations to the Cornerstone Group – James good to see you.  Now the conversation when it comes to the coronavirus is to the recovery and how economy recovers and how we pay back that enormous amount of debt, whatever form it takes, it’s going to have to be a big agenda and perhaps a different way of thinking.  Do you think all the interested parties in this sense are capable of putting ideology aside?

JAMES CULLEN, SENIOR DIRECTOR, CORNERSTONE GROUP: I suppose time will be the true test there Laura – absolutely right. There’s quite a few things that need to happen here in terms of rebooting the economy and getting growth picking up next year, but obviously with an eye to paying down debt.  I think in some ways the roadmap is sort of been set forward here by how the Government has actually handled COVID-19 and I think what worked pretty well with the JobKeeper package in particular was their ability to put ideology aside, and I think everybody across the country saw that fairness was at the heart of that package and while we can quibble around the edges of that package I think the fact that fairness was what drove that package that really sort of guided the way for the Government in terms of what may come next.

So if they can continue with that kind of lens to reform and excepting that maybe the perfect agenda – the 25 per cent company tax rate or broadening the GST – they may not be able to get that far,  but there might be some other middle ground if you like they can look at reaching out to the community sector, to business, to unions and do I say, to Labor, to try and find something that will take us forward over the next year or two.

JAYES: I think there’s been a bit of a ceasefire when it comes to the political battle in the recent weeks,  but that is certainly creeping back in –  just talking to Anthony Albanese there, he really wanted to point out that the economy was perhaps heading in the wrong direction, before the bushfire crisis, before COVID-19 and he wanted to point out that the government did something in secret last week that only gives people 24 hours to actually fix up some IR issues (without going into details) so look,  I think there is signs of ideology already. But what do you think about the environment now for company tax cuts for example? Is it the time to be talking about those and do you think Labor might be able to come to the party? If, and of course there is a big if here , if it is part of the bigger reform agenda?

CULLEN: Look, never say never, I think we just need to be really clear that the starting point can’t be the same old ideological starting points like – let’s have a big GST increase or a big cut in company tax cuts and everyone else has to pay for it.  I think it needs to be accepted that we’re not going to land the perfect package necessarily, but that’s okay. We can do – it might be an investment allowance instead of a broad-based company tax cut; it might be a 25 or 30 dollar a week permanent increase in Newstart not 75 dollars a week. It might be a cap on franking credits instead of abolishing it. There’s a whole lot of good middle options you can do for a broader economic and tax reform package, so I think we need to be pragmatic, and pragmatism was at the heart of the Government’s response to COVID-19 and I think they got a bit of tick for that to date. You expect oppositions are going to hold government to account and to criticise when necessary and that’s fine, but there’s no reason why the current mood in the country is for reform, and the Government should capitalise on it as the window will start to narrow as the months tick by.

JAYES: Yes it certainly will. James are you an optimist or pessimist when it comes to the other side of this and how quickly we can recover?

CULLEN: Look I’m an optimist when it comes to reform because I think that hopefully the government has learnt a lesson from it handled things now if it’s willing to utilise that lesson then I think the sky is the limit.  I think the economic recovery is going to take a bit of time and we need to accept that. The Government has been doing a reasonable job along with the RBA and others in managing expectations and we’re going to see some bad news – unemployment is going to tip up, growth is going to go backwards, we’re going to see some pretty bad numbers for the next year or so.  So it is going to be a be a long way forward,  I do think though that that once we start to see those restrictions easy and hopefully some confidence, you know, creep back into the economy – we’ll start to see the economy in the labour market tracking in the right direction. We just need to except that it’s going to take time and we’re going to need to be patient,  just like we’ve been patient in dealing with Covid-19.

JAYES: And patience is a virtue that not a lot of politicians I have met have. But who knows James, it will be different other side of this. Thanks so much for your time.

CULLEN: Thanks Laura

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