- The government has announced a wage subsidy of $1,500 per employee per fortnight, to be paid to employers affected by the economic downturn caused by the coronavirus.
- The 'Jobkeeper' payment will apply to full-time, part-time and casual workers, as well as sole traders.
- Businesses will be eligible to receive the wage subsidy if they have taken a 30% hit, with businesses with more than $1 billion turnover eligible if they have taken a 50% hit due to the coronavirus.
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The government has announced it will pay businesses seriously affected by the coronavirus a wage subsidy, to ensure they keep employees on the books through the coronavirus pandemic.
Prime Minister Scott Morrison announced the 'Jobkeeper' payment in a press conference on Monday afternoon, saying it was intended to "cushion the blow" of the coronavirus-led downturn, and prevent the loss of potentially millions of jobs.
“We are living in unprecedented times," Morrison said. "This calls for unprecedented action."
The wage subsidy is a flat payment of $1,500 per employee per fortnight, which Treasurer Josh Frydenberg said represented 70% of the Australian median wage and 100% of the median wage in the industries most seriously affected by the coronavirus, including hospitality, retail and tourism.
Employers with turnovers of under $1 billion will be eligible to receive the subsidy if they have taken a 30% hit to their annual turnover. For businesses with turnovers of more than $1 billion, they will have had to take a hit of 50% or more.
Full-time, part-time and casual workers are all eligible for the Jobkeeper subsidy, as well as sole traders. Casual employees must have been with their employers for 12 months or more to be eligible. In a first, New Zealanders on 444 visas who have been working for more than one year will also be eligible.
It is a flat payment, both Morrison and Frydenberg stressed, meaning that for some employees – especially casual workers – it may represent more than 100% of their fortnightly earnings.
The payments to employers will start on 1 May, and will be backdated until 1 March, which is the cutoff date for eligibility.
“That means they can still have them on the books and start working together on how they can resuscitate the business on the other side,” Morrison said.
Those already stood down due to the coronavirus crisis are eligible, encouraging employers to put them back on the books. The payments will be delivered through the Australian Taxation Office (ATO).
The wage subsidy will cost $130 billion, bringing the current stimulus effort to $320 billion. That represents around 16% of Australia's GDP.
In announcing the program, Morrison said it was intended to prevent nothing short of an economic collapse – the likes of which we may see internationally through the pandemic.
“Many countries, in the months ahead and perhaps beyond that, may well see their economies collapse," Morrison said. "Some will see them hollow out. In the very worst of circumstances, we could see countries themselves fall into chaos."
"This will not be Australia."