The End Of COVID-19 Disaster Payments

While many Australians have relied on a range of COVID-19 disaster payments to survive, the Federal Government has announced that they won't last forever. 

Administered by the Australian Tax Office, the JobKeeper Payment was a scheme released in 2020 by the Federal Government. Designed to be a means to financially support businesses and not-for-profit organisations during the peak of the COVID-19 pandemic in Australia, there’s no denying that the payment helped to keep thousands - if not, millions - of Aussies in a job, and out of the Centrelink line. 

Before the program was rolled out back in March 2021, JobKeeper Payment was supporting around 3.5 million individuals, in over 900,000 businesses around the nation, with the payments from the scheme said to have totalled around $60 billion. However, as repeatedly stated by Prime Minister Scott Morrison and Treasurer Josh Frydenberg, the scheme was never intended to be a long term one. 

At the time when JobKeeper was rolled back in late March, Australia was relatively well positioned economically and more or less free of COVID-19 after Melbourne managed to squash the disastrous second wave of 2020. However, Sydney unwillingly became the new epicentre just a few weeks later in June. As Australia’s financial hub, the Federal Government quickly had to backpedal and find new ways of providing support to the many Australians locked out of work, which signalled the introduction of COVID-19 Disaster Payments. 

A Quick Guide To COVID-19 Disaster Payments

While some dubbed the new COVID-19 Disaster Payments as “Jobkeeper 2.0”, the funding was allocated in quite a different fashion when compared to its predecessor as a means to be slightly more selective with who got what. 

If a region or town was placed into lockdown and declared a hotspot by the Federal Government, it would activate access to COVID-19 Disaster Payments for residents of the affected areas. Under the payment, eligible recipients could receive $750 per week if they lost over 20 hours of work, $450 per week if they lost between eight and 20 hours, and $200 per week for those on income support payments who lost over eight hours of work. Deemed to be a more targeted approach to providing financial aid, the new scheme has so far supported over two million Australians since it’s rollout, with over $9 billion dollars in payments being issued. 

However, on Wednesday 29 September, Federal Treasurer Josh Frydenburg caught many people off guard when he announced that the COVID-19 Disaster Payments would soon cease. Many have even suggested that withholding financial support is how the Government plans to put pressure on states who are not in lockdown, as a means to open their borders in line with the National Plan. 

In a joint statement with Senator Bridget McKenzie, Minister for Emergency Management and National Recovery and Resilience, Treasurer Josh Frydenberg made the following comments on the upcoming changes to the program. 

“As part of our economic recovery plan, the temporary payment will begin to transition once a state or territory reaches 70% full vaccination of its population - that is, 16 years and older - in line with the movement into Phase B of the National Plan agreed to at the National Cabinet. In line with the movement into Phase C of the National Plan, where a Commonwealth Hotspot remains in place and a state or territory reaches 80% full vaccination of its population - 16 years and older - the temporary payment will step down over a period of two weeks before ending.”

In simple terms, what this means is that once a state or territory reaches 70% double dose vaccination levels, the automatic renewal of the temporary payment will end. In the first week after a state or territory reaches 80% double dose vaccination, there will instead be a flat payment of $450 for those who have lost more than eight hours of work, while those on income support will receive $100. In the second week, the payment will be $320 for the week - in line with JobSeeker - for those who have lost more than eight hours of work. The payment will end for those on income support.

Like all other components of the National Plan, this of course seems to be subject to how each state and territory choose to proceed. While Sydney, Melbourne and Canberra battle their way through what is arguably Australia’s third wave, vaccination levels are being more closely monitored than ever - and will have a ripple effect throughout all corners of our great nation. 

Navigating The World Of Business With The Professionals 

There’s no denying that brands and businesses of all shapes, sizes and sectors have done it tough in the last twelve months. Whether you’re starting a business, purchasing an existing one, or even re-evaluating where your current one stands - all require some form of financial know-how if you hope to successfully navigate your legal requirements as well as hitting your business goals. 

However, if understanding the legalities that surround your business or finances isn’t your strong point, then it may be reassuring to know that you’re not alone. In fact, many businesses (big and small) enlist the services of an accountant in order to free up their time while knowing that their financial obligations are already taken care of by the professionals. 

Ultimately, the team at Muro believe that every business owner is an entrepreneur. However, accounting does not discriminate - finances break down barriers and are not territorial. If you would like to take a deeper look into your finances, please get in touch with us at Muro today to ensure that you’re on the right path for success.