ScoMo’s huge handout headache as Australia smashed COVID-19
JobKeeper, JobSeeker and other stimulus payments and supplements are pouring into households as pressure grows for the PM to put an end to some of it sooner.
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Aussies have been champions at controlling the coronavirus, but it’s creating a big financial dilemma for Prime Minister Scott Morrison.
Some of the government assistance now flowing to millions of Australians should be able to be stopped, or at least wound back, before its scheduled to end.
But if the PM tries to grab back money he’s already promised to people, he’s going to be in many voters’ bad books.
His government may have to choose between a PR nightmare or a debt nightmare. If payments continue when they’re no longer needed, our national debt grows more.
There’s the $1500 fortnightly JobKeeper payments going to about 3.5 million workers until late September, even if their workplace goes back to normal sooner.
The enlarged JobSeeker unemployment benefit – now $1100 a fortnight – is scheduled to halve back to its pre-COVID level from late October.
And another $750 payment to pensioners and other government payment recipients is due to land in their accounts in July, following a previous $750 payment in April.
These payments have been a windfall for many Aussies, with a surge in spending at many retailers. Other people – such as unlucky workers and self-funded retirees – have missed out.
The big question is how the PM will handle this situation if normal life returns sooner.
The bigger picture is really how well our nation has managed the pandemic while record numbers of cases continue to hit the world.
We do see some scary reports of virus deaths and outbreaks in Australia, but our overall numbers are amazing.
We’ve dropped from the COVID-19’s 14th worst-hit nation in February – when cases mainly came from China and a cruise ship – to the 63rd worst-hit. The US has had one thousand times more coronavirus deaths than we have, and Britain has suffered close to 400 times more deaths at 37,000-plus.
This huge difference in death tolls puts Australia at a great international advantage, and our healthier society will hopefully mean a healthier economy than many countries.
But should we keep up the huge handouts when they’re no longer necessary?
There have already been reports that the new JobSeeker payment of $1100 a fortnight is prompting people to prefer staying at home rather than find work. And surveys show a majority of Australians believe the higher rate should stay rather than halving it back to Newstart Allowance levels.
I reckon the PM will put debt control ahead of PR and reduce handouts to portray his team as good economic managers. It will probably start with the JobKeeper review this month.
If you’re receiving a government support windfall, what should you do before it disappears?
1. Enjoy some of it. Receiving this money is a bit like lottery success, and lottery winnings should buy something nice.
2. Try to stash most into an emergency fund. Who knows what the world will be like in a year?
3. Don’t get mad about it ending, because if it does it means we’re doing much better as a nation than the rest of the world.
Originally published as ScoMo’s huge handout headache as Australia smashed COVID-19