Federal Treasurer Josh Frydenberg has announced Covid disaster payments for workers impacted by lockdowns will be discontinued once a state and territory reaches its 80 percent vaccination mark even if some regions end up being locked down again as a result of an outbreak.
This means that income support for individuals who lost work during lockdown will likely end in New South Wales by the middle of October and in Victoria by the start of November.
The Australian Government is looking to discontinue the payments after distributing over $9 billion in disaster payments to 2.16 million people since June 2021.
The Australian Government will begin to wind up the payments once vaccination rates reach 70 percent of the adult population. When a region reaches 70 percent, the payment will no longer be renewed automatically. To receive the payment, workers will be required to reapply for the payment to confirm their eligibility, provided they live in an area that remains a commonwealth-declared hotspot.
Once a state or territory reaches 80 percent fully vaccination of their over-16 population, the payment will step down over two weeks before ending, and no new applications will be allowed, even if an area goes back into lockdown.
Federal Treasurer Josh Frydenberg has outlined that the payment was in line with easing restrictions as outlined in the plan signed off by national cabinet.
“As I have said before we can’t eliminate the virus, we need to learn to live with it in a Covid safe way. This means we must ease restrictions as vaccination rates hit 70-80% in accordance with the plan agreed at national cabinet,” said Federal Treasurer Josh Frydenberg.
“As restrictions ease the economy is well-positioned to bounce back. Today’s announcement about the winding down of the Covid disaster payment will provide businesses and households with the certainty they need to plan for the future,” continued Mr. Frydenberg.
Josh Frydenberg has said that federal government was continuing to discuss with locked-down states and territories on how business support payments would also begin to taper off once vaccination rates hit 70%. The government would have “more to say shortly” on the issue.
The return to pre-pandemic level income support payments, which will kick in two weeks after a state reaches the 80% vaccination rate, will see payments dramatically reduced for those out of work.
Under the current Covid disaster payment system, eligible recipients have been receiving $750 a week if they have lost over 20 hours of work. Recipients have been paid $450 a week if they lost between eight and 20 hours. Workers have been receiving $200 a week of income support payments if they lost over eight hours of work.
In the first week after a state or territory has reached 80 percent vaccination, there will be a flat payment of $450 for those who have lost more than eight hours of work, while those on income support will receive $100.
In the second week, the payment will be brought into line with jobseeker at $320 for the week for those who have lost more than eight hours of work, while the payment will end for those on income support.
According recent figures published by Services Australia, 2.16 million people have received at least one Covid disaster payment, with 3.63 million claims resulting in $9.02bn in payments.
Close to 225,000 people on income support have claimed a $200 income support payment totalling $172m, while about $100m has been paid in pandemic leave disaster payments.
Over one million people in NSW have received at least one disaster payment, with a total of $6.13 billion paid out in that state alone, with payments costing on average $600 million every week.