Launch of three-step lifeline for lockdown

These are difficult days for the people of New South Wales.

More than 5 million are in lockdown.

There are hundreds of active cases, and tragically, 2 people have died over recent days.

Just as the people of New South Wales have overcome virus outbreaks before, they will do so again.

And they will do so in the knowledge the Morrison Government has their back.

Since COVID began, more than $60 billion in direct economic and health support from the Federal Government has been delivered to the people of New South Wales.

In New South Wales, more than 1.2 million people received JobKeeper, more than 292,000 businesses received the cashflow boost, and $9.7 billion went to veterans, carers, and others on income support.

Now, we go further with increased income support for households, new grants for businesses, and administrative relief from the Australian Tax Office.

It builds on existing support measures announced in the Budget just a few weeks ago, like personal tax cuts, loss carry-back and immediate expensing provisions.

It complements programs that are already underway at the state level, including business grants and payroll tax relief, as well as private sector initiatives, such as loan repayment deferrals offered by the banks.

Yesterday’s announcement has been welcomed by the business community, with the Australian Chamber of Commerce and Industry calling it a “swift and coordinated response”

and Business NSW describing it as a “big boost for businesses” that would “give them the best chance to rebound their operations when the lockdown finishes”.

The Business Council of Australia said the measures “put workers first by keeping them connected to their employers”, while the Australian Industry Group said it was “insulating those worst affected by lockdowns” and will “help maintain the overall health of the economy.”

Our support package has the following key elements.?First, the COVID disaster payment will be increased.

From next week, workers who have lost 20 hours or more per week will receive $600 per week, and those who have lost between 8 and less than 20 hours per week will receive $375.

These payments are set at the same level that was available under JobKeeper from September to December last year.

They are an increase on the current level of payments of $500 and $325 respectively, with more than 130,000 people in New South Wales already having had claims granted.

No liquid assets test will apply to these payments and we are removing the need for individuals to have to reapply every seven days.

These payments will be delivered through Services Australia and will be available to workers across New South Wales that have lost more than 8 hours of work per week.

The Federal Government will pay for those recipients in the hotspot areas, including Greater Sydney, and the State Government will pay for those outside the designated hotspot areas.

The payments will be ongoing until significant restrictions are lifted, or the hotspot designation is removed.

Second, businesses and not for profits impacted by the lockdowns will get a significant cash flow boost.

Jointly funded by the Federal and New South Wales Governments, eligible businesses that have seen their turnover fall by 30 per cent or more will receive a payment of between $1,500 and $10,000 a week.

This will be equivalent to around 40 percent of their payroll.

These payments will be considered non-assessable income and therefore tax free.

To be eligible businesses will need an annual turnover of between $75,000 and $50 million, covering around 98 percent of businesses in New South Wales who together employ more than 3 million people.

Sole traders will also be covered with a payment of $1,000 a week.

Businesses receiving this cashflow boost will be required to commit to maintain their head-count, which includes full time and part time staff, as well as long term casuals.

A similar type of payment, linked to payroll, was implemented by the Morrison Government last year, and provided businesses with the necessary support to meet some of their fixed costs, including rent and utilities.

These costs were still being incurred even as customers were not coming through the door.

Finally, the Government will work with the ATO to provide administrative relief for businesses that are suffering hardship as a result of the lockdowns.

This could include reduced payment plans, no interest on late payments and varying installments on request.

During the height of the pandemic last year, the ATO adopted this more flexible approach, as one of the many measures implemented to support businesses in their hour of need.

The recent outbreak in New South Wales is a timely and a somewhat painful reminder that we are, by no means, out of the COVID crisis.

Australia has done remarkably well during COVID on both the health and economic front, with more people in work today than before the pandemic began, and a loss of life far below that experienced by comparable nations.

But there is much work still to do.

This latest support package for New South Wales will not only help households and businesses across the state, but provide a template for further support in other jurisdictions, should they experience an extended lockdown.

We are all in this together and New South Wales success in beating the virus will be Australia’s success.

Josh Frydenberg is the Federal Treasurer