Finance Minister Mathias Cormann has hinted further JobKeeper changes may be on the radar, noting that the government is “prepared to make decisions in the context of an evolving situation based on the information that comes before us”.
On Friday, Treasurer Josh Frydenberg announced eased eligibility criteria for JobKeeper 2.0 by adding an extra $15 billion to the scheme to cushion the blow of Victoria’s tough stage 4 restrictions.
On 21 July, the government had initially said that to be eligible for JobKeeper post-27 September, businesses would need to show their GST turnover had fallen in the two quarters to the end of September, compared to the same period last year. However, due to Victoria’s tough restrictions, the government has backtracked, choosing to shift to an easier test and allow more businesses to stay on the support.
Under the new rules, the details of which were announced on Friday, businesses will have easier access to the extension, but the payment rate will drop as planned from $1,500 to $1,200. The $750 flat rate for those working less than 20 hours per week will also proceed as previously announced.
Speaking on ABC radio over the weekend, Mr Cormann said that the government’s intention is to transition the economy and the fiscal policy settings back to the new normal by the end of March.
“But depending on what happens, we don’t know what we don’t know. We can speculate, but it might well be that things will be better than anticipated,” Mr Cormann said.
“Earlier in March when we expected the worst, we thought that the JobKeeper program would cost us $130 billion. By the middle of May to the middle of June, the easing of restrictions in the economy was able to happen faster than anticipated originally and the costs came down. There will be swings and roundabouts.”
He reiterated that if things change, the government will reassess what may or may not be appropriate at the time.
“We will make sensible decisions considering all of the information in front of us.”
Speaking about the upcoming budget, Mr Cormann said that the government is trying to manage the transition out of the crisis-level fiscal support into a sensible new normal arrangement, where businesses have the best possible opportunity to be successful into the future.
“We will be focusing on the next instalment of our five-year plan for the strongest possible economic and jobs recovery on the other side of this crisis,” Mr Cormann said.
He also hinted that further tax tweaks are on the agenda to ensure that the tax policy settings give businesses the confidence to invest in their future growth.