Text size Follow us on Twitter Find us on Facebook

'The cliff': what happens when Australia's coronavirus stimulus runs out of road?

In the first entry of a new series in The Guardian examining the economic impact of the federal government's COVID-19 recovery spending, Anne Davies queries (26.5.20) what the Coalition is planning after the September stimulus 'deadline'.

'With news last Friday that the centrepiece of Australia’s coronavirus stimulus package, jobkeeper, will cost $60bn less than forecast, the federal government has an opportunity to rethink its approach to address what economists are referring to as “the cliff”.

'The cliff, or “gap”, refers to the fact that almost all of the stimulus measures put in place by the government to soften the blow of the Covid-19-induced economic shutdown will run out by September. And then what?

'In a new series, Stimulus under scrutiny, Guardian Australia has undertaken an investigation into how the coronavirus support programs are working, what role they play in cushioning the blow of the shutdowns, and where they are not working.

'We have asked economists and experts how they need to be tweaked to ensure that they address inequities and better assist in Australia’s economic and social recovery.

'The federal budget is not due until October and, at this point, there’s no clear roadmap about what will happen beyond that point.'

Top economists want JobSeeker boosted by $100+ per week and tied to wages

Peter Martin writes in The Conversation (29.11.20) about the looming decrease in the JobSeeker payment, warning that the scheme needs to be increased as the economic impacts of the coronavirus pandemic linger.

'Once about as high as the pension, the JobSeeker (Newstart) unemployment payment has fallen shockingly low compared to living standards.

'It’s now only two thirds of the pension, just 40% of the full-time minimum wage and half way below the poverty line.

'JobSeeker has fallen relative to other payments because while the pension and wages have climbed faster than prices, JobSeeker (previously called Newstart) has increased only in line with prices since 1991.

'In an apparent acknowledgement that JobSeeker had fallen too low, the government roughly doubled it during the coronavirus crisis, introducing a supplement to enable people to “meet the costs of their groceries and other bills”.

'… Ahead of a decision about any permanent increase expected early next year, The Conversation and the Economic Society of Australia asked 45 of Australia’s leading economists where they thought JobSeeker should settle.'

 

Previous : Next

 

© 2021 The T J Ryan Foundation


TJ RYAN FOUNDATION LIMITED ACN: 165152625 ABN: 78 165 152 625 info@tjryanfoundation.org.au
Registered office: SOUTH BRISBANE QLD 4101 Regulator: Australian Securities & Investments Commission