The government’s $1,500 per fortnight JobKeeper wage subsidy will be extended for Australians until March, the Prime Minister will reveal on Tuesday.
The payment will however be subject to a new turnover test, and a different rate will apply for part-time and casual employees.
Businesses must also pass a new eligibility test in October, which will involve testing their actual turnover to determine whether the business recovered in the last six months.
The announcement follows extracts of Treasury’s review into JobKeeper, which revealed that the subsidy was still “needed”, but required a “test to ensure that JobKeeper is well targeted”.
"A better approach to sectoral targeting would be to maintain JobKeeper but reassess eligibility in October based on actual decline in turnover,'' Treasury stated.
The new tiered system will reportedly range from $1,000 to $1,200 per fortnight for the top tier, and $500 to $600 per fortnight for the bottom tier.
“A three month review of the JobKeeper payment found the scheme met its objectives, preventing widespread business closures and putting a brake on the job losses that commenced in the second half of March,” Treasury stated.
“JobKeeper has been an economic lifeline to millions of Australians and that lifeline will be extended for those businesses that need it most.”
Finance Minister Mathias Cormann revealed JobKeeper was well targeted to businesses that suffered an average decline in turnover in April of 37 per cent or more, but there were some features of the subsidy that created “adverse incentives”.
For example, some casuals were scoring pay rises of up to $550 a fortnight.
“This formed part of our considerations as we looked at the next phase of the JobKeeper program,” Cormann said.
The $550 per fortnight Coronavirus Supplement, which is currently propping up the JobSeeker payment to $1,100 per fortnight, will also be extended until December, but reduced.
"While the income increase of $550 is significant, it’s important to acknowledge that this is calculated based on the income a recipient was receiving from their JobKeeper employer and does not take into account any income that they may have lost through losing a second job,” Frydenberg said.
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