Coronavirus: It’s the economy, Covid: shutdowns rejected

NSW will prioritise economic recovery over pre-emptive lockdowns, even as it slashes the number of people allowed in pubs.

People queue in their cars for a COVID-19 test at a testing station at the Crossroads Hotel in Casula, southwest Sydney, on Monday. Picture: AFP

The NSW government will prioritise economic recovery over pre-emptive lockdowns, even as it slashes the number of people who will be allowed in the state’s pubs and ramps up enforcement against venues flouting the rules.

As Victorian health authorities warned that infected travellers visited a string of venues across Sydney last week, NSW cabinet on Monday night decided to cut from 20 to 10 the number of patrons who could book in a group and strengthen flying squads to enforce COVID-19 social distancing rules.

NSW Premier Gladys Berejiklian in Sydney on Monday. Picture: Damian Shaw

But senior ministers remain committed to keeping the NSW economy open as businesses warn they cannot afford a repeat of a hard lockdown in the wake of Victoria’s decision to enforce a six-week stay-at-home order in Melbourne after a spike in COVID-19 transmissions.

The recovery of the NSW economy, which makes up about a third of the national economy, was the subject of fierce debate during a telephone hook-up of senior ministers on Sunday night that included Premier Gladys Berejiklian, Deputy Premier John Barilaro and Treasurer Dominic Perrottet.

The strong belief among most senior ministers was that lockdowns of any kind would be anathema to economic recovery. The state’s hospital system was equipped to handle a sharp rise in cases, and a lockdown would be an absolute last resort.

As Victoria recorded 177 new cases of COVID-19 on Monday, NSW reported another uptick in community transmissions from a cluster forming out of the Crossroads Hotel, including a case at The Star casino near the CBD.

The state’s chief health officer, Kerry Chant, said it was too early to tell what had caused the original outbreak in NSW but an obvious line of inquiry would be whether “patient zero” was from Victoria, where outbreaks have caused partial lockdowns and the closure of the border between the two states.

The Crossroads Hotel has been linked to 21 active cases of coronavirus since July 3 and there are fears that it could be the source of infections at other sites.

Two Victorian residents separately attended the Murray Downs Golf Club, on the NSW-Victorian border, along with the Cook @ Kurnell restaurant and Highfield Caringbah in the Sutherland Shire. They also attended Merimbula RSL and the nearby Waterfront cafe. Confirmed cases from the Crossroads Hotel have separately visited Canterbury Leagues Club in Sydney’s southwest, a Planet Fitness facility at Casula, the Narellan Town Centre shopping district, a Zone Bowling facility at Villawood and The Star.

NSW Chief Health Officer Kerry Chant in Sydney on Monday. Picture by Damian Shaw

The rise in cases and their rapid spread across numerous regions points to the difficulties NSW contact tracers face as they work to track down asymptomatic and symptomatic individuals who may have been infected.

Josh Frydenberg on Monday warned that the unemployment rate could be about 13.3 per cent, significantly higher than official figures, if the number of people on government support was fully taken into account.

The Treasurer indicated the economic statement would maintain support for COVID-19 affected businesses and workers, and the assistance would be available across the nation.

“We’ve gone for a national approach as opposed to state-specific approaches and that continues to be the pathway that we have set and we will follow,” the Treasurer said.

Graham Turner, the chief executive of leading domestic and international travel company Flight Centre, has warned Australia is at a “critical juncture’’ in how it will fare from the pandemic and it needs a nationally consistent strategy to deal with the crisis.

Economists warned on Monday that greater Melbourne’s six-week lockdown could slash as much as $8bn off the economy in the September quarter and cost tens of thousands of jobs.

Goldman Sachs chief economist Andrew Boak estimated that the lockdown in Victoria would slash about 1.5 per cent from Australia’s GDP in the September quarter, which would equate to about $8bn. Goldman Sachs analysts said the impact on firms from a second lockdown could be even more severe.

A medical worker tests a woman in her car at the Crossroads Hotel in Sydney on Monday. Picture: AFP

Analysis by UBS suggested Australia’s hard-fought economic recovery from the pandemic could be at risk should the second-wave of COVID-19 infections spread beyond Victoria and force similar lockdowns in NSW and Queensland.

KPMG chief economist Brendan Rynne said an estimated 42,000 jobs were at risk in Victoria, as the economic gains achieved since the depths of the coronavirus impact in April “evaporated” as a result of the lockdown.

Victorian Premier Daniel Andrews on Monday urged people to follow the lockdown rules and refused to rule out tightening restrictions across Melbourne and the Mitchell Shire.

“If you don’t want a stage four, if you don’t want this lockdown to last a moment longer than the six weeks that I’ve indicated, then please follow the rules,” Mr Andrews said.

“Do the right thing by your family, your community, and every family.”

Monday night’s NSW cabinet meeting agreed on alternative measures that would keep pubs and hotels open but penalise them heavily for failing to adhere to COVID-safe guidelines.

The government is on Tuesday set to announce a reduction in group booking sizes, from 20 people down to 10 people.

COVID-safe enforcement squads will be established to monitor social distancing at ¬larger venues, as well as a requirement that all patrons record their details upon entry, rather than just one person doing so on behalf of their party.