Second wave of restrictions could cost Tasmania $100M per week

More than 5000 Tasmanians are expected to regain jobs under step one of the state’s plan to ease coronavirus restrictions – but if restrictions are reintroduced, they will have dire economic consequences.

MORE than 5000 Tasmanians are expected to regain jobs under step one of the state’s plan to ease coronavirus restrictions.

But if the State Government is forced to reintroduce restrictions due to a second outbreak, it would cost the economy $100 million per week, new federal Treasury modelling shows.

The dire warning comes as Treasurer Josh Frydenberg will today outline the economic fallout from coronavirus, and the potential gains if Australia can dodge a second wave of the deadly disease.

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In a major address to parliament, he will say Australia’s GDP is expected to increase by $9.4 billion each month, under the three-step plan to reopen the economy.

For Tasmania, GDP is expected to increase by $53 million in the first month and $163 million by phase three in July.

Treasury modelling predicts about 70 per cent of the 26,000 Tasmanians expected to lose their jobs in the first half of 2020 will re-enter the workforce over the next three months.

About 5200 Tasmanians are expected to regain work in the first stage, 5855 in the second stage, and 7033 in the third stage. But that means about 30 per cent — a further 7800 jobless — are not expected to regain work yet.

The modelling shows the total hit to the economy would be $4 billion per week if every state was forced to reintroduce restrictions, or $100 million per week in Tasmania alone.

“Overall, the economic data has been sobering,” Mr Frydenberg will say today.

“In March, business and consumer confidence saw the largest declines on record.

“In April, surveys showed that job ads halved and activity in the construction, manufacturing and services sector had their largest ever month falls.”

But Mr Frydenberg will say $320 billion worth of government spending to cushion the blow of coronavirus was “designed in a way that protects the structural integrity of the budget”.

It comes as Prime Minister Scott Morrison yesterday downplayed reports the Government was considering winding up JobKeeper payments before September, as it continued on its so far successful path to flatten the coronavirus curve.

Mr Morrison said speculation the payment would be reduced or cut off early was “premature”.

“The impact of the virus, how it will impact on Australia in the months ahead, with a reopening economy, is very much a work in progress.”

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