The largest peak union body in Australia says many bushfire-affected Australians, especially those on the front line and in small businesses, are living on the equivalent of the Newstart allowance of $40 a day.

Australian Council of Trade Unions president Michele O’Neil, along with peak recovery bodies representatives from the National Farmers’ Federation, the Red Cross, Tourism and Transport Forum Australia gathered in Canberra on Friday at a roundtable with the Prime Minister Scott Morrison.

Speaking on ABC’s Radio National program on Friday morning, Ms O’Neil said people didn’t want to leave affected communities, but wanted to stay and help rebuild and spend their money in their own towns.

“People want to be able to stay. They want to be part of the recovery.

“But the reality of not having enough money to live on is you’re forced into being a bushfire refugee.”

She said there was also the issue of smoke affecting workers, with national guidelines needed.

Mr Morrison says fire-ravaged communities will lead the recovery effort in the next stage of the government’s response.

The government wants to work with the groups to ensure the recovery effort caters for the affected regions in both the short and long term and to coordinate the most effective delivery of services through government, businesses and not-for-profit organisations.

In a week of roundtables, Mr Morrison met small business operators on Tuesday where a range of support was canvassed including rent, loan and rates relief, accounting assistance, fast-tracked invoices being paid by big businesses and tourism marketing for the hardest-hit regions.

The government announced a plan to provide up to $75,000 to affected farmers to cover the cost of fences, sheds, machinery, carcase disposal or other work to meet their immediate needs.

At least $100 million in grants will be available but the scheme has not been capped.

In times like this, when we’re seeing such devastation from these terrible bushfires, people turn to our amazing charities for help along with their governments. Today we met in Canberra with those charities to align what we’re doing & ensure help is getting where it’s needed. pic.twitter.com/ewlYmhKn1P

— Scott Morrison (@ScoMo30) January 16, 2020

On Thursday, he met the charity chiefs, telling them the government had taken detailed advice from the tourism, small business, infrastructure, agriculture, transport, financial and welfare sectors as to how the “next phase” of the recovery will look.

“We will be moving on to the next phase soon, which is all about the locally led recovery and the response plans that will be developed on the ground and we will work with you and them in those places,” Mr Morrison said.

The head of the government’s bushfire recovery agency said the bushfires were having a broader impact on local economies than previous disasters.

“Unlike a lot of disasters, there’s a consequential effect here,” Andrew Colvin told Sky on Thursday.

NSW Liberal MP Andrew Constance said “very big mistakes” were made leading into the bushfire season but emphasised the current focus should remain on recovery.

“We can’t distract from what’s going on at the moment,” Mr Constance told Sky News on Thursday.

“I’ve been very concerned about the speed in which that’s been happening.

“We’ve got a lot of money that’s starting to be announced with the best of intentions and now we’ve got to make sure bureaucracy doesn’t get in the way.”

The government is working on broader plans to help small business and tourism, as part of its $2 billion recovery package.

-with AAP