Businesses brace for JobKeeper revamp
Businesses might have to requalify for JobKeeper as the Morrison Government puts the final touches on extended pandemic income support plans, with almost one million Australians out of work and the government believing the real jobless rate to be significantly higher than official figures.
The government has been working on a package to continue JobKeeper – originally due to expire in late September – and will release the details on Thursday.
JobKeeper has paid $1500 a fortnight to eligible businesses and employees hit by the pandemic, with Treasury and the ATO estimating 3.5 million Australians receive the benefit at a $70b cost to the budget.
Treasurer Josh Frydenberg will use Thursday’s economic update to announce the future of the program and the boosted JobSeeker unemployment benefit.
Both are legislated to end on September 27, six months after the coronavirus support measures started.
JobKeeper is likely to switch from $1500 fortnightly payments to a tiered structure closer to workers’ pre-coronavirus wages.
Frydenberg said the initial design of the program was based on getting money out as quickly as possible.
“One of the outcomes of that is that some people under the program received more money in the form of this $1500 flat payment than they were receiving prior to the crisis,” he told Sky News this morning.
Finance Minister Mathias Cormann said the next phase of coronavirus support would be based on need. This would likely include sectors requiring help beyond September such as aviation, tourism, arts and hospitality were sectors which would need help beyond September.
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“Businesses that have recovered or are recovering clearly won’t need the sort of support that has been in place over the last few months on an ongoing basis, but other businesses will,” he said on Friday.
“It will come down to making sure that we properly assess the need, and identify and target support into those areas where support is indeed needed.”
Cormann noted businesses which qualified at the start of JobKeeper remained eligible for the entire six months.
“The truth is, a lot has changed during this period,” he said.
“A number of businesses have seen strong recoveries, other businesses continue to be seriously challenged.”
The government has been under pressure from business and welfare lobbies to continue JobKeeper payments, with SA Treasurer Rob Lucas and Business SA also warning of the economic impact if it stops.
“It will be there for everyone who needs it, based on the impact on their business and the impact on their employees,” Prime Minister Scott Morrison said on Friday.
Jobs figures released last week show the national seasonally adjusted unemployment rate increased from 7.1 per cent 7.4 per cent, with 994,000 people now officially jobless.
South Australia’s jobless rate climbed from 7.9 per cent in May to 8.8 per cent in June – the worst rate since the 9 per cent recorded in January 1999.
In June, 817,300 people were recorded as being employed in South Australia – 37,000 fewer than in March, at the beginning of the pandemic.
But despite the official Australian Bureau of Statistics figures, the Federal Government believes the real unemployment rate is significantly higher.
“[It is] around 13.3 per cent right now,” Frydenberg told reporters last week.
“That is a large number of people reflecting the economic challenges that we see right now.”
However, Prime Minister Scott Morrison said on Friday the real rate was now estimated to be around 11 per cent.
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The latest unemployment data, released Thursday, showed almost one million Australians were out of work in June, when the jobless rate hit a 22-year high of 7.4 per cent.
Morrison said the national measures to be announced this week would “disproportionately benefit” Victoria, where a fresh outbreak has forced millions of Melburnians back into lockdown.
“The reason for that is they’re assessed based on the need and the impact of the virus on people’s businesses,” he told 3AW radio.
“That is clearly going to be greater in Victoria than many other parts of the country.”
Morrison is also ploughing another $400 million into an existing fund to attract big budget productions to Australia.
He said the cash grants would create 8000 jobs per year, including trades that support the stage and screen sector.
The prime minister has also weighed in on debate around masks, saying they should only be worn in Victoria, and only where people can’t social distance, including indoors and on public transport.
“The only thing that matters is getting on top of this,” he told the Nine Network.
“I will give Daniel Andrews every support he needs to be able to achieve that. It’s what Melburnians and Victoria needs. If Victoria isn’t successful Australia isn’t successful. We need Melburnians and Victorians to win here.”
The prime minister described a worsening Victorian outbreak as a big setback to economic recovery, but is pleased by the rapid NSW response to a growing pub infection cluster.
-with AAP
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