Who benefits from Scott Morrison’s $66bn coronavirus ‘safety net’

Aussies in financial hardship will get to access their retirement savings early, seniors and veterans will get a $750 cash payment and anyone who loses a job will get double the dole for six months under Scott Morrison’s $66 billion safety net.

• Tough new controls with many public places closed
• SA closing borders indefinitely
• This story about the coronavirus crisis is free for all readers – please consider supporting our journalism with a subscription

People who lose their jobs in the coronavirus pandemic and those still looking for work will get access to a new, temporary $550 a fortnight payment as part of a $66.1 billion "safety net" for those worst affected.

The new coronavirus supplement will effectively double welfare payments to $1100 a fortnight – or $78.50 a day – for existing and new recipients of the JobSeeker payment (formerly known as Newstart), as well anyone on Youth Allowance, Farm Household Allowance, Parenting Payment or Special Benefit, for six months.

The asset test and waiting period will be waived.

A $750 cash payment will also go into the pockets of about five million Australians on the aged pension, carers allowance, family tax benefits or veterans pension on July 13 as part of the package.

And Australians in financial stress will be able to access their retirement savings early.

Treasurer Josh Frydenberg and Prime Minister Scott Morrison on Sunday. Picture: David Gray / AFP

Prime Minister Scott Morrison said the raft of measures were about “supercharging” Australia’s safety net for the most vulnerable.

He warned there was no “two-week quick fix” to get Australia through the crisis, and flagged more “draconian” measures would be needed to halt the deadly virus’s spread.

“In the months ahead, we will find out just how strong we are,” Mr Morrison said, as he urged Australians to learn the wartime lessons of past generations who had stuck together through challenges.

“While these hardships and sacrifices may break our hearts on occasion, we must not let them break our spirit.”

Treasurer Josh Frydenberg said authorities now expected the economic shock from the COVID-19 pandemic to be “deeper, wider and longer”.

Under the superannuation access changes, people in financial hardship will be able to draw up to $10,000 out of their retirement savings for each of the next two financial years.

In a move that will put more money in the pockets of thousands of South Australian pensioners, deeming rates will also be cut by 0.25 per cent from May 1 after the Reserve Bank's decision to slash the cash rate to a historic 0.25 per cent.

Retirees will also have more flexibility around superannuation, with drawdown requirements for super account-based pensions to be lowered by 50 per cent. The package will also include payments of up to $100,000 for about 690,000 small and medium businesses and about 30,000 not-for-profits, including charities, to cover wages and utility bills.

The Government will also guarantee 50 per cent of new loans to small and medium businesses from eligible lenders, which comes after banks last week promised to defer loan repayments for businesses hit by coronavirus. Rules around trading while insolvent will also be relaxed.

Seniors and social services lobby groups welcomed the welfare payment boost, but the superannuation sector raised concerns about the long-term impacts. Business SA chief executive Martin Haese welcomed the package, but said more was needed, including relief on rent and utilities.

Australian Council of Social Service chief executive Cassandra Goldie said doubling welfare payments for six months would be "a huge relief” for many, while ACTU president Michele O’Neil called for “real wage subsidy support so people are not putting their retirement at risk”.

Originally published as Who benefits from Scott Morrison’s $66bn coronavirus ‘safety net’