News JobKeeper cuts, eligibility restrictions in mini-budget

JobKeeper cuts, eligibility restrictions in mini-budget

Treasurer Josh Frydenberg and Prime Minister Scott Morrison have announced a big extension to JobKeeper. Photo: ABC News/Nick Haggarty
Twitter Facebook Reddit Pinterest Email

The federal government remains tight-lipped on the details of the new phase of its JobKeeper and JobSeeker programs, but small tidbits are beginning to leak out ahead of Thursday’s mini-budget.

Prime Minister Scott Morrison will share “modifications” to the schemes this week, and is expected to announce they will continue for several months beyond their scheduled end dates, but with a tightening of eligiblity criteria and a gradual cut in payments.

With the $70 billion wage subsidy and the increased rate of the welfare payment due to expire in late September, and Victoria’s new lockdowns only scheduled to lift a few weeks before that, Mr Morrison has been under pressure to let the programs continue for some time longer –especially for businesses like tourism and entertainment which will be crippled by the pandemic for some time to come.

Scott Morrison and Josh Frydenberg said more on JobKeeper will be revealed on July 23. Photo: AAP

Since Premier Daniel Andrews put his state back under strict stay-home orders, the PM and treasurer Josh Frydenberg have been peppered with endless questions about how the federal government will step in to help Victorians.

People in other states nervously await potential further lockdowns of their own to the end of the year.

The Liberal leaders have played their cards close to their chest, promising there would be further support past the scheduled September expiry dates, but not ruling out changes and fat-trimming.

Mr Morrison and Mr Frydenberg have hinted that JobKeeper would be wound back for industries and businesses that have recovered well from COVID shutdowns and downturns, with Commonwealth cash more closely targeted at those which still need extra help.

“There are other parts of the economy … for whom their turnover will continue to be down because of the COVID-19 pandemic and because of the restrictions that have been put in place on the economy,” Mr Morrison said Monday, speaking at a retail display company in his home patch of Miranda.

“They will need continued support, and they will get continued support. And many businesses like them, as we work through those changes we will be announcing this week.”

Prime Minister Scott Morrison met workers at DisplayWise in Sydney on Monday. Photo: AAP

The government is expected to tinker with those conditions in Thursday’s economic update, described as a ‘mini-budget’ by some.

“It will be targeted, it will be temporary,” Mr Morrison said on Monday of the new phase of JobKeeper.

“The Treasurer and I will soon be making announcements about JobKeeper and JobSeeker, but we know how important JobKeeper has been.”

Speaking to Sky News on Monday, Mr Frydenberg seemingly confirmed that eligiblity criteria around JobKeeper would be tightened.

A bone of contention has also been the situation of casual or part-time workers who may receive more under the JobKeeper flat rate payment of $1500 a fortnight than they would normally get while working.

Josh Frydenberg has flagged JobKeeper “modifications”. Photo: AAP

The treasurer hinted that tweaks would likely see an end to those arrangements, calling it an “issue” that would be altered with “modifications” to the JobKeeper scheme.

“There will be another phase of income support. There will be some modifications,” Mr Frydenberg said.

The government is also expected to release the long-awaited treasury department report into JobKeeper’s first phase, ahead of the announcement of the second.

Also expected to be confirmed on Thursday is the future of the JobSeeker allowance.

The welfare payment was effectively doubled with a temporary $550 per fortnight coronavirus supplement, but that too was always described as a short-term change.

Labor, the Greens and numerous social organisations and charities have called for JobSeeker not to return to its meagre $40 a day allowance.

A report from The Australia Institute said some 650,000 people would be plunged back into poverty if the payment was wound back.