Treasurer Josh Frydenberg slaps down Victoria’s wage subsidy plea
Josh Frydenberg has rejected Victorian government demands for a wage subsidy for workers struggling through lockdown
Josh Frydenberg has rejected demands from the Victorian government for a new wage subsidy for thousands of workers who will struggle through the state’s lockdown, warning that the commonwealth will no longer step in when Covid-19 lockdowns occur.
The Treasurer, responding to sharp criticism from Victorian Acting Premier James Merlino and Treasurer Tim Pallas, said the commonwealth had already contributed about three times more in direct economic support than the state government had.
Victoria’s outbreak grew to 40 cases on Sunday with five new locally acquired infections, including an aged care worker from Arcare Maidstone who had received her first dose of a Covid-19 vaccine.
While federal health secretary Brendan Murphy said Victorian authorities were bringing the latest Covid-19 cluster “under control”, Australian Medical Association president Omar Khorshid said there was a “significant chance” the lockdown would have to be extended beyond the original seven-day plan. “We are very concerned with the Melbourne lockdown just due to the size of the number of people being contacted – last count was over 15,000 people,” Dr Khorshid said.
Mr Merlino and Mr Pallas, releasing a $250 million support plan for businesses, said the lockdown would cost the Victorian budget $700 million. The package includes $2500 grants for small and medium-sized businesses in industries that cannot operate due to the restrictions, with licensed venues to be able to apply for $3500 payments. Events that had to be cancelled or incurred losses can also receive support from a new $20 million fund.
Mr Pallas said the government’s repeated requests for commonwealth assistance in the form of a wage subsidy had been declined. “I am angry and I am disappointed,” he said. “Disappointed because, while all the language talks about a partnership, it delivers nothing in real terms for the people who need it most.
“(The Morrison government) like to pride themselves on being the party of the forgotten people. Well, the people they seem to have forgotten is Victorians and in particular Victorian workers.
“This idea that we are working hand-in-glove, when they never put their hand in their pocket, is nothing short of a disgrace.”
Both Mr Frydenberg and Scott Morrison dismissed the comments, highlighting how the federal government had already contributed $45.2 billion to Victoria in the form of pandemic support including $38 billion in JobKeeper payments to 1.1 million employees
“Since the end of JobKeeper (in March), Victoria is the third state to introduce a short lockdown,” Mr Frydenberg said.
“In both the Queensland and Western Australian lockdowns, further federal support was not required. In the case of Victoria, the Morrison government has provided and continues to provide an unprecedented level of direct economic support.”
Speaking from New Zealand, the Prime Minister said both the Queensland and WA governments “took on those responsibilities and I commend them for that”.
Senior federal government sources said the rejection of Victoria’s request for support was not about setting a precedent but because it was the states who were best equipped to manage short, sharp lockdowns.
The Victorian lockdown is the longest to be called since the end of the JobKeeper wage subsidy scheme, and both business and union figures are concerned about the impact on workers.
The Australian Council of Trade Unions estimates more than half a million casual workers will lose hours and pay because of the lockdown, which was “caused by the Morrison government’s failures on quarantine and the vaccine rollout”.
ACTU president Michele O’Neil said: “The Morrison government should put in place JobKeeper 2 for those who need it, hand over the vaccine rollout for aged and disability care to the states, and deliver on their promise of a federally co-ordinated quarantine system.”
Restaurant and Catering Australia chief executive Wes Lambert said the state and federal governments should consider a JobKeeper-style wage scheme to reflect the size of a business and what they needed to survive a lockdown.
“Our fear is that this ‘circuit breaker’ turns into another ‘total power outage’ for the hospitality industry,” Mr Lambert said. “We still have no idea if this lockdown will end on Thursday as expected. If it drags on past seven days it could mean lights out for good.”
Australian Retailers Association chief executive Paul Zahra also wants Victoria and the federal government to ensure there was ongoing targeted support or “lifelines” such as JobKeeper for affected businesses.
“The cost of the Victorian lockdown is mounting by the day, and while the state government’s business support package is a small relief, it won’t fully offset the losses they’ll incur during the current seven-day shutdown,” Mr Zahra said.
The Palace Hotel South Melbourne – a pub temporarily shut down after a positive Covid-19 case visited on May 21 for an hour from 5.45pm – would be eligible for a $3500 grant but owner Jessica McGrath said the money would not go far.
“I am glad they have offered something. It’s better than nothing, but it is not going to cover much (like) all our stock that was just delivered, opened wine, tapped beer, wages, rent, electricity … the list goes on,” the 38-year-old said.
Ms McGrath and about a dozen staff are part-way through a 14-day quarantine after the venue was identified as being a “significant” concern. It will stay closed until health authorities deem it safe. The pub owner supported the vaccine rollout extending to young people, particularly those essential workers in supermarkets, if it meant fewer snap lockdowns.
ADDITIONAL REPORTING: PAUL GARVEY, BEN PACKHAM
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