Path out of lockdown will consider economic cost of lockdowns and vaccination rates

Australia’s path out of lockdowns will be decided by how many people are vaccinated but will also take into account the economic cost of restrictions that have already cost taxpayers and businesses billions of dollars.

Political leaders will be warned of the economic cost of sustained lockdowns in a Treasury analysis to balance new advice to national cabinet on the target vaccination rate required to open up.

Australia will need to vaccinate 80 per cent of the entire population to lift restrictions, a new report says.Credit: Dean Sewell

National cabinet will also discuss whether snap lockdowns on low coronavirus case numbers are the best way to handle Delta variant outbreaks, given their success in Victoria and South Australia.

New modelling from the Grattan Institute found Australia could ease restrictions and end lockdowns when 80 per cent of the entire population has been vaccinated, a target that could be reached by the end of the year if children under the age of 12 are included in the rollout.

Without vaccinating young children, the country could achieve the level of coverage that would minimise deaths and keep pressure off hospital systems even with more coronavirus in the community by March next year, the Grattan Institute’s Race to 80 report shows. The Doherty Institute will present separate modelling to national cabinet on Friday.

Prime Minister Scott Morrison said Australians can expect a straight answer on what vaccine rates the country and each state and territory will need to reach before moving on to phase two of the four-stage transition to a COVID-normal society, but national cabinet won’t have that answer immediately.

“[We] get one of the world’s best scientific organisations, the Doherty Institute, to tell you what the rates, risks are against various vaccination levels for the general population. And then you get the best economic advice from your Treasury to work out what the cost of various restrictions are. And you come up with what the right vaccination rate is to enable that to happen,” Mr Morrison told 3AW.

Treasury Secretary Steven Kennedy will present the economic advice, while Doherty Institute professor Jodie McVernon will take leaders through the vaccination modelling.

The Treasury analysis models scenarios ranging from lighter restrictions to sweeping lockdowns to consider the risks to the economy and jobs. The results provide a counterbalance to the Doherty Institute’s work because national cabinet could consider the economic consequences in setting a more ambitious vaccination target or supporting longer lockdowns.

To date, 14.2 per cent of the total population, or 3.7 million people, have been fully vaccinated and 31.7 per cent (8.1 million) have received a first dose.

National cabinet will also discuss the best way to approach snap lockdowns to deal with the Delta variant, after the success of Victoria and South Australia in handling outbreaks.

“I think the lesson of these last six weeks or so is that under the Delta strain, going quickly and early is clearly the new mode of operation,” Mr Morrison told the Nine Network.

“And we’ve seen Victoria and South Australia come out quickly. And that’s great news in those states. But we have to press on in New South Wales, in Sydney we’ve got to make sure this lockdown is effective.”

Health Minister Greg Hunt said the Doherty Institute’s report will be made public when national cabinet has worked through it, but this masthead previously revealed it will recommend a higher vaccination rate for older Australians than for the younger cohort.

Stephen Duckett, who heads the Grattan Institute’s health program, believes the Doherty Institute’s modelling will have a similar conclusion to the Grattan report. The institute’s report said on top of 80 per cent vaccination coverage for the entire population, 95 per cent of vulnerable people including all those over 70 should be immunised.

“What we’re trying to do is minimise hospitalisations and deaths,” he said, adding he expects national cabinet to largely accept that 80 per cent target.

The Grattan report found a vaccination rate of 80 per cent would prevent the hospital system from becoming overwhelmed should the virus spread through the community, and result in fewer deaths.

It pointed to Singapore, which recently entered a partial lockdown as cases rose despite 73 per cent of the population having received at least one dose of a vaccine.

“If you [open up] at 80 per cent, it is still likely that the virus will circulate in the community,” Dr Duckett said.

“It is this trade-off we’re making ... we wanted to talk about it as able to happen soon, so that people were motivated to say, ‘let’s get it over and done with, let’s get this vaccination stuff done’.”

It was also possible for children under 12 to start getting vaccinated this year, Dr Duckett said. Pfizer is running trials of its vaccine in younger children, and Dr Duckett said data on its safety and efficacy in 2 to 11-year-olds is expected in September or October, meaning Australia could potentially approve its use in that age group before the end of the year.

Professor Mary-Louise McLaws, an epidemiologist and advisor to the World Health Organisation, said the Grattan report was in line with projections from other countries including New Zealand, as well as estimates from independent experts.

But she said reaching that 80 per cent target would be an enormous challenge, pointing to slowing vaccination rates in the US and UK despite an initial quick take up.

“I really implore the authorities to realise that they’ll get really good uptake [initially] and then they’ll find it really hard to get that last 20, 15 per cent of people. It will be very, very slow,” she said.

“That’s why they need to go in very hard now and encourage as many people as possible to take it up.

Mr Hunt said the federal government was determined to offer vaccines to every Australian this year.

“Our goal is crystal clear to ensure that by the end of the year, by Christmas, every Australian is given the opportunity to be vaccinated and as many Australians as possible are vaccinated,” he told reporters.

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