Treasurer Josh Frydenberg has confirmed the federal government is considering financial support for Victorian workers facing a second week in lockdown.

Mr Frydenberg confirmed on Thursday there had been discussions overnight, following a second plea from the Victorian government for the federal government to step in to help.

Hundreds of thousands of casual workers in Melbourne face another week without work and pay because of the extended lockdown. Retail, in-house dining and drinking, gyms and hairdressers remained closed in the city, although restrictions are expected to ease in regional Victoria from midnight Thursday.

Mr Frydenberg hinted that any decision to extend lockdown support would not be localised and instead involve a broader policy shift.

“What we need to think about, obviously given the pandemic is still with us, is how we approach this on a national basis,” he said.

“It’s not about Victoria, Western Australia or individual cases. We will stick to our principles.”

The Kooyong MP noted lockdown-hit Victorian workers could apply for JobSeeker payments, with the removal of the regular waiting period and mutual obligation requirements.

Mr Frydenberg was adamant Victoria had the capacity to respond to its initial one-week lockdown. But now the lockdown is being extended by another week across Melbourne, he is considering a disaster and emergency style payment scheme.

“There are options that we are considering and that is one of many that we have looked at,” Mr Frydenberg told ABC radio on Thursday.

“There is a need in Victoria for continued support.”

Mr Frydenberg is determined to pull existing levers to deliver temporary and targeted assistance.

Pressure is mounting on the federal government to open its chequebook for Victoria.

An outbreak of the Indian variant of coronavirus has triggered a seven-day extension to the Victorian capital’s lockdown, which was initially slated to end on Friday.

The outbreak rose to 60 cases on Wednesday, with no update yet available for Thursday.

Acting Victorian Premier James Merlino has made a desperate plea for extra Commonwealth help with thousands of workers and businesses copping the brunt of restrictions.

But the Morrison government is concerned a one-off package for the state could set a precedent for other states considering lockdowns when confronted with outbreaks.

Victorian Treasurer Tim Pallas has branded the federal government’s refusal to reinstate JobKeeper wage subsidies a disgrace.

The state government is spending $459 million in business assistance over the two weeks of lockdown.

Prime Minister Scott Morrison and Mr Frydenberg spoke with their state counterparts on Thursday night.

It is understood the federal Coalition government favours assistance with nationwide implications, rather than a large Victoria-specific funding injection.

Mr Morrison has rejected opposition accusations he is to blame for the lockdown because of a sluggish vaccine rollout and failure to seize control of quarantine.

“Decisions to implement lockdowns in states and territories around the country are solely and totally the responsibility of state and territory governments,” he told parliament.

Labor shadow treasurer Jim Chalmers said the Coalition should agree to Victoria’s request for financial support for thousands of workers not receiving a pay cheque.

“The Morrison government’s failures on vaccines and quarantine are strangling the small businesses of Victoria,” he said on Wednesday.

There are also renewed calls for an overhaul of hotel quarantine after a man in Perth became infected by a fellow returned traveller in a room next door, the 21st breach in a hotel.

Talks between the Victorian and federal governments are progressing on a stand-alone quarantine facility, likely to be based near Avalon Airport.

Mr Frydenberg told ABC TV on Thursday a decision on that proposal was “imminent”, and likely within days – but wouldn’t be drawn further.

Jane Halton, who undertook a major review of quarantine, has said it is perplexing it has taken so long to increase capacity at the Howard Springs quarantine camp in the Northern Territory and look at facilities in other states.

-with AAP