News How to stop Australians being swept over the cliff of COVID-19’s economic disaster

How to stop Australians being swept over the cliff of COVID-19’s economic disaster

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Thousands of people are experiencing unemployment for the first time, experts say, making the case for more federal support Photo: Getty
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The JobKeeper program requires urgent reform, union officials and community groups say, alleging too many bosses are exploiting the scheme while people who desperately need the subsidy are missing out.

Prime Minister Scott Morrison remained tight-lipped on what financial assistance will continue after September, when JobKeeper and the temporarily increased JobSeeker payments are scheduled to end.

The Prime Minister said Wednesday “a further phase of support” will be outlined in the July 23 economic update, but didn’t list specific details.

As Melburnians face six weeks of stay-home orders, community and workers’ groups have called for the programs to be amended.

Centre Alliance senator Rex Patrick, representing South Australia, said he wanted to see JobKeeper and JobSeeker continue beyond September.

Luke Hilakari, secretary of the Victorian Trades Hall, feared what the employment market would look like once the programs ended.

Victorian Trades Hall Secretary Luke Hilakari

“Currently, it’s estimated there are 12 people applying for every available job. Without continued support we’re staring down the barrel of an economic disaster when the support that is currently available is withdrawn,” he told The New Daily.

“There needs to be greater clarity around the [JobKeeper] rules to ensure that the benefits flow to working Victorians.

“There are too many bosses who are either ripping off their staff or who have locked their staff out of JobKeeper.”

Mr Hilakari also wanted to see employers offer a fortnight of ‘pandemic leave’ for people needing to care for family, as well as offer better flexible working arrangements.

As Victoria battles to contain a worrying surge of infections, economic forecasts released by Deloitte Access Economics on Monday revealed a second wave of infections would cost Australia $100 billion in lost national income.

If the outbreak is not quickly contained, consumers would lose confidence in the government’s ability to keep them safe – and stay at home while cutting back on spending, according to Deloitte partner Chris Richardson.

“If everybody’s a bit more cautious, then that hurts the economy,” he said of the potential $100 billion hit over two years.

However, Mr Richardson says it remains to be seen whether government should extend JobKeeper beyond September, or explore “cheaper but more complex” forms of stimulus.

The Australian Council of Trade Unions has been calling for JobKeeper and JobSeeker to be extended for some time, reiterating those calls in light of the deteriorating situation in Victoria.

The ACTU wants JobKeeper kept for an extra six months, out to March 2021, likening the impending end of the program to an “economic trapdoor opening up underneath” workers.

Victorian Council of Social Services CEO Emma King demanded federal support remain well beyond the end of the state’s lockdown.

“These measures were put in place to help us through the worst of the pandemic. Well, the worst isn’t over yet,” she said.

“It’s completely infeasible to be winding down support for Victorians just as the virus is rearing its head again.”

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Victorian Premier Daniel Andrews in front of a graphic showing the Melbourne areas that are now locked down.

The Australian Unemployed Workers Union said the Victorian situation was a sign the increased JobSeeker amount needed to be kept nationwide, telling The New Daily that a permanent increase to the welfare payment would keep people safer, AUWU spokesman Tom Studans said.

“If Victoria is going back into lockdown, the government is not in a position to roll back income support for anyone. We can’t just pretend a whole state doesn’t exist – people have interstate family and work commitments that are affected by the new lockdowns,”

“With Australia still in the grip of coronavirus, COVID-related income support measures such as JobKeeper … must be extended to all immediately at a minimum.”

Jenny Smith, CEO of the Victorian-based Council to Homeless Persons, also warned other economic measures – like rent relief – would be crucial to keeping people in their homes.

“We still don’t know what the long-term economic impacts will be on households already in financial hardship; in light of the second lockdown, they risk falling off the cliff if the rent and eviction moratoriums aren’t extended,” she told The New Daily.

“Thousands of people are experiencing unemployment, rent stress, and homelessness for the first time. It is vital that we provide the support that allows them to recover.”