The government will spend $130 billion over the next six months to keep about six million Australians in jobs, in the third and largest stimulus package to cushion the impact of coronavirus on the economy.
Designed to keep employees attached to their workplace even if a business goes into "hibernation," the JobKeeper payment will be a flat $1500 payment each fortnight, Prime Minister Scott Morrison said.
Businesses and not-for-profit organisations that lose 30 per cent more of their revenue over a month-long period from March 1 would be eligible for the payment, but businesses with turnover of more than $1 billion annually would need to have lost half their revenue, and the banks are not included.
All workers, whether they be casual, full time or part time, will be treated the same, as long as they were employed on March 1. For casuals they need to have been employed for the past 12 months, and can only claim the payment from one employer.
For workers in industries that have been hit hard by the downturn, like accommodation, hospitality and retail, the payment equates to a full median replacement wage, the government says. For some casual and part time workers, the payment represents a pay increase on what they may have been earning.
The payments would be made to employers through the tax office, which would use data on the number of employees through the Single Touch Payroll system. Mr Morrison said the payment was to keep workers on at work, and out of Centrelink queues.
The payment would also apply to New Zealand citizens on 444 visas, but won't include people from other countries in Australia on working visas.
While the payments will start on May 1, they will be backdated to Monday, in the hope that employers who may have been considering laying off staff in the next week will keep them "on the books".
It is the third round of stimulus announced by the government, with the biggest price tag. It brings the total spent by the government in stimulus to $320 billion, or 16.4 per cent of gross domestic product.
Both Mr Morrison and Treasurer Josh Frydenberg said the announcement was about "building a bridge" to the other side of the economic crisis caused by the coronavirus.
"This is about keeping the connection between the employer and the employee and keeping people in their jobs even though the business they work for may go into hibernation and close down for six months," Mr Morrison said.
"When the economy comes back, these businesses will be able to start again and their workforce will be ready to go because they will remain attached to the business through our JobKeeper payment."
Mr Frydenberg said the JobKeeper payment was more generous than those introduced in countries like New Zealand and Canada, and would be available to people in all businesses, not just small businesses.
"This unprecedented level of support reflects the unprecedented moment that we are in, and the announcement today is the means by which Australians can get to the other side of this coronavirus," Mr Frydenberg said.
Parliament will need to be recalled to pass the legislation for the package, Mr Morrison said, but the date is yet to be confirmed.
The announcement has been welcomed by both unions and business leaders, but unions have called for more clarity on what workers are eligible.
"We are concerned that the $1,500 a fortnight subsidy may not be enough. We believe that allowing this amount to increase up to the median wage of $1,375 a week is what is needed," Australian Council of Trade Unions secretary Sally McManus said in a statement.
"We also want to ensure all casuals who could have reasonably expected to work now but have lost their jobs because of the pandemic are covered.
"Many of these workers may not have worked the last 12 months. "
We also want to ensure that this subsidy applies to the 1.7 million visa workers who were working, there is no reason why it should not."
Australian Small Business and Family Enterprise Ombudsman Kate Carnell said the package was a relief for small business owners.
"Crucially, it will allow small businesses to continue trading and paying their staff. It will also ensure small businesses stay connected with their staff, who have been stood down, so they can re-engage their team when trading conditions return to normal," she said.
The government has also changed the income threshold for the partner of someone who has lost their job, raising it to $79,762 a year. Previously someone who had lost their job but whose partner earned $48,000 or more couldn't access the JobSeeker payment.
The announcement helped the share market rally to its best day on record, rising 7 per cent at close.
The S&P/ASX200 benchmark index gained 163.1 points in the final 24 minutes of trade to finish Monday up 399 points, or 7.0 per cent, to 5,181.4 points.
The All Ordinaries index rose 319.8 points, or 6.56 per cent, to 5,194.
- For information on COVID-19, please go to the federal Health Department's website.
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- If you have serious symptoms, such as difficulty breathing, call Triple Zero (000)
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