The Morrison government has overhauled income and business assistance measures for the third time in six weeks as the entire state of Victoria joined greater Sydney and plunged into lockdown for five days. With more than 12 million people again under lockdown and pressure from Victoria for the federal government to do more to help stranded workers and businesses, Prime Minister Scott Morrison “simplified and streamlined” the assistance package.

See below for further detail.

[Tax Month – July 2021]

 


 

PM overhauls aid package as Victoria locks down again

On 15 July 2021, Phillip Coorey, AFR’s Political Editor, posted an article under the above heading.

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The package was first unveiled last month in response to Victoria’s two-week lockdown at that time, and revamped only on Tuesday in response to the NSW crisis.

 

Scott Morrison will propose to the national cabinet that people can still get payments during shorter lockdowns, such as Victoria’s five-day one, if state governments pick up half the tab.  Jessica Hromas

 

 

 

Contending that the “very fluid situation” required constant versatility, Mr Morrison said that subject to the national cabinet’s approval on Friday, the income and business support measures would now be paid sooner and, in the case of income support, at a higher rate. The $10,000 liquid assets tests for personal income support will be scrapped.

Under the changes, it is expected that Victorian workers affected by the latest lockdown will receive income assistance, even though the five-day lockdown imposed by Premier Daniel Andrews falls short of the seven-day trigger for the new payment system.

On Thursday, as Sydney reported another 65 cases, Mr Andrews announced his state’s fifth lockdown, this time in response to an outbreak of the delta variant of the coronavirus, which originated in Sydney.

Mr Andrews said Victoria had 18 known cases, 75 exposure sites, 1500 primary close contacts and 5000 secondary close contacts.

In sharp contrast to greater Sydney, which has more than 900 cases and is enduring at least a five-week lockdown amid relatively light restrictions, Mr Andrews imposed stage four restrictions for five days across the state from 11.59pm Thursday.

“We would prefer this had not come to our state. You only get one chance to go hard and go fast. If you wait, if you hesitate, if you doubt, then you will always be looking back wishing you had done more earlier,” he said.

“I am not prepared to avoid a five-day lockdown now only to find ourselves in a five-week or a five-month lockdown.”

He said, however, that as more information came to light, restrictions on the regions could be lifted even earlier.

Knowing that Victoria was going to impose the lockdown, Mr Morrison, who had been accused by the state’s premier two days earlier of being the Prime Minister for NSW, announced the new assistance measures several hours before Mr Andrews’ announcement.

Payment schedule

Previously, workers who lost fewer than 20 hours a week were eligible for a $325 payment in the second and third week of a lockdown and $375 from week four onwards. There would be nothing for the first week.

Those who lost 20 or more hours, were eligible for $500 for weeks two and three and $600 from week four onwards.

Under the latest iteration, the payments will be available from the first week and will be $375 and $600 from the outset.

A $10,000 liquid assets test that determined eligibility for the payments in week two was scrapped.

The federal government will continue to fully fund the payments and only if the lockdown meets the definition of a Commonwealth hotspot and lasts at least seven days.

However, because the Victorian lockdown will last only five days, Mr Morrison and Mr Andrews will negotiate on Friday over handing the payments to Victorian workers, with each government sharing the cost.

“I would be staggered if the Prime Minister and the federal Treasurer want to look Victorians in the eye and say ‘you were locked down for five days, you weren’t locked down for seven and therefore you are not getting anything’,” Mr Andrews said.

“I really don’t think they would want to get into that sort of argument.”

A federal government source said there would be no such argument and Mr Morrison would be happy to discuss a pro-rata arrangement with Mr Andrews.

As for the weekly cash-flow payments of between $1500 and $10,000 for small and medium businesses, they will now be available after two weeks of a lockdown, not from the fourth week as was the previous arrangement.

Splitting the bill

The federal government and the states will continue to fund the business payments on a 50:50 basis.

For the first two weeks of a lockdown, any other business assistance will continue to be the responsibility of the state government and Mr Andrews said his administration would pay up for the five-day lockdown.

“I’ll have more to say as early as tomorrow and we will look to fast-track payments principally to those who received payments last time,” he said.

Mr Andrews said his government would also foot the bill for income support payments in regional Victoria because the regions do not meet the federal government definition of a hotspot.

The federal government is coming under increasing pressure with each lockdown because it highlights the slowness of the vaccine rollout.

‘Keep our spirits up’

Mr Morrison urged people to keep their spirits up.

“The rollout continues to ensure that by the end of this year, all of those seeking a vaccine can receive one. That means we can go into the next phase and the next phase after that,” he said.

“The other hope I give you is this – because Australia has had the success to date, where we’ve saved over 30,000 lives, where we’ve got 1 million people back in work, that shows the strength of the Australian economy to rebound.

“It shows the strength of the Australian people to come back. And so, all we need to keep doing is putting our heads down, go forward, keep our spirits up, get the job done, and Australia will not just get through this, we’ll come out the other side stronger.”

Mr Morrison said lockdowns should always be a last resort “but sometimes with the delta variant you come to that position a lot more quickly than you used to”.

 

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