Coronavirus Australia: Banks agree lifeline with Treasurer to rescue workers and businesses

Banks agree to bridge gap ahead of May roll-out of government’s $1500 a fortnight wages subsidy.

Treasurer Josh Frydenberg and the banking sector struck a deal to help tide businesses over. Picture: AAP

Banks have offered a lifeline to ­viable businesses to cover the wages of millions of workers for the next four weeks and to bridge the gap before the government’s $130bn pay subsidy kicks in during the first week of May.

As employer groups on Sunday demanded unions and Labor get out of the way and drop calls for 11th-hour changes to the rescue package, Josh Frydenberg and the banking sector struck a deal to help tide businesses over.

The emergency measure would lead to advances and loans ­being offered to some businesses to keep paying their workers until the $1500-a-fortnight wages subsidy is rolled out.

The Morrison government warned the opposition there was no room for compromise on the bill, which would offer a liveable wage to six million workers at risk of losing their jobs, as Labor threatened to scuttle the package if the Fair Work Commission wasn’t given veto over it.

Attorney-General Chris­tian Porter issued a challenge to the ­opposition and the crossbench, saying parliament would sit for as long as necessary on Wednesday to get the legislation passed.

Senior government sources said the bill was non-negotiable.

“On Wednesday, we are pushing a $130bn lifeboat out into the roughest economic seas Australia has ever seen,” Mr Porter said.

“People must decide whether they want to help us push the boat out, but it is going out on Wednesday — and we are not going to be ­arguing about timing and process and speculative possibilities.”

Labor has accused the government of taking a “sledgehammer approach” by insisting on amending the Fair Work Act to protect employers from being in breach of awards if they cut working hours to ensure the $1500 payment.

Mr Frydenberg also announced the threshold for charities to access the Jobseeker payment would be lowered to 15 per cent loss of revenue, down from the 30 per cent level which applies to small and medium-sized businesses.

With 121 awards and 11,000 enterprise bargaining agreements in place, the government has ­argued that the unions’ demands would mean a delay to the scheme that could see businesses fold and workers laid off before it could even be ­implemented.

Australian Banking Association chief executive Anna Bligh last night told The Australian the banking sector was willing to extend credit to viable businesses to keep their doors open and keep people in jobs until the JobKeeper scheme came into effect, adding further pressure on the unions to move aside.

“Banks will offer to bridge the gap wherever possible. For some businesses, more debt won’t be the right answer but we are willing to throw a lifeline to people to get them through,” Ms Bligh said.

The Treasurer said the move by the banks would provide a bridge until the JobKeeper payments flowed through to employers.

With a showdown looming over the package when parliament resumes on Wednesday to pass the legislation, employers urged the changes be put in place swiftly.

“This issue needs to be addressed urgently and it is simply not practical for the issue to be ­addressed through variations to all awards and thousands of enterprise agreements,” Australian Industry Group chief executive Innes Willox said.

Australian Chamber of Commerce and Industry chief James Pearson said: “We expect our parliament to do its job this week to ensure that the jobs of Australians — and the businesses that employ them — are protected.”

He said it was vital that small businesses were given the means to keep their enterprises going and their people employed.

“The government’s JobKeeper package is designed to do that, and it needs to be done in a way that incentivises small businesses to take up the scheme,” Mr Pearson said.

ACTU boss Sally McManus on Sunday urged Labor and the Greens to oppose changes to the Fair Work Act. She warned that 1.1 million casual workers who had been with an employer for less than 12 months would miss out on the JobKeeper subsidy if the government didn’t broaden eligibility.

She said unions were also concerned some employers who were unaffected by the crisis might take advantage of changes to workplace laws to direct their employees to take leave.

“We're worried that if you change the rights of workers, unfortunately some employers might abuse that,” Ms McManus said.

However, she acknowledged there would be “swings and roundabouts” in the way the package ­applied, with some lower-paid workers getting more than they would normally earn, and some higher-paid workers getting less.

If the Greens and Labor vote against the package, the government will have to get three of five crossbench votes to pass the amendments in the Senate.

Centre Alliance senator Rex Patrick said the changes made sense “assuming there is a time limit, flexibility and protections against abuse in the legislation”.

The unions also want casuals to get access to the money.

Opposition industrial relations spokesman Tony Burke said by insisting on amending the Fair Work Act, the government was risking “unforeseen, unintended and bad” outcomes, but Labor was prepared to negotiate on the amendments to deliver the package for workers.

“We want to see it get through the parliament,” Mr Burke said.

Mr Porter said the changes to the Fair Work Act, which will have a six-month sunset clause, will allow distressed companies to pay under-award wages to workers in the form of the $1500-a-fortnight JobKeeper payment.

He said the government would ensure the changes were “as inclusive as possible”, and he would work through the legislation “line by line” with the ACTU to assure the union movement there would be no rorting by employers.