MTAQ's Dr Brett Dale
Published on July 22nd 2020 in

Job support extension a win for businesses

The Motor Trades Association of Queensland (MTA Queensland) has welcomed the Morrison government’s announcement to extend the income support provided by JobKeeper for another six months.

The payment subsidy will be reduced after a Treasury review found that if left unchanged, the program could disincentivize a return to work. The review indicated the payment was originally designed to halt the spiraling unemployment rate occurring in late March and continuing the support under the current arrangements could lead to adverse economic consequences.

The changes and extension of the scheme will be effective from October until the end of March 2021. The $1,500-per-fortnight JobKeeper wage subsidy will be replaced by two tiers of payment to more closely reflect the income of an individual prior to COVID-19. The new payments will be $1,200 for the top tier and $750 for the bottom tier.

The Treasury review found that one quarter of the 3.5 million workers currently receiving JobKeeper were earning about $550 more a fortnight than before the COVID-19 crisis. JobKeeper 2.0 will introduce a new eligibility test that will differentiate between businesses that are in the rebuilding phase and those still struggling. Businesses with pre-COVID turnover of less than $1 billion will again have to demonstrate a decline of more than 30 per cent. This will need to be shown using quarterly Business Activity Statements which show a reduction between this year’s September quarter and last year’s quarter, or for those filing monthly, a drop between September this year and September last year.

“The Government’s decision gives confidence to those businesses that are still heavily impacted by COVID-19 and further recognises that some businesses are yet to be affected, and they will require longer term support due to global supply chain implications yet to be felt,” said Dr Brett Dale, Group Chief Executive of MTA Queensland.

“We also fully support the tapering of subsidies for businesses that are recovering, as well as reduced payments for casuals and part-time workers which align more closely with their regular pay. It is sensible that the government recognises that support needs to be delivered in phases as there are many uncertainties associated with COVID-19 and the effect on the automotive industry may increase with time. The Government must ensure the long-term welfare of businesses is supported so they can keep their staff and remain viable.”

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