As Scott Morrison admits the economy won’t reopen by Christmas and the Victorian crisis hampers the recovery, members of his government have hinted at an extension of key stimulus measures.
While an extra $15 billion has already been tipped into JobKeeper in response to the worsening Victorian crisis, Finance Minister Mathias Cormann has indicated the federal government is open to extending JobKeeper again.
“What we have demonstrated over the last six months is our preparedness to keep responding to an evolving situation,” Mr Cormann told media. “We don’t know what we don’t know. Right now, our intention is to phase out this crisis level fiscal support…but in the end, as we have done in the past, we will continue to respond to the facts as they emerge.”
While the government is mindful of its fiscal expenditure, Australia’s debt position “continues to be manageable” on an international basis and its AAA credit has made it through the crisis relatively unscathed, meaning there is still room to move on a stimulus extension.
“We will continue to make the decisions that need to be made, sensible decisions,” Mr Cormann said. “But we are focused on supporting Australians through this crisis, doing what needs to be done to respond to the health challenge and to the economic and jobs challenge.”
Shadow finance minister Stephen Jones has said that Labor will work with the government on any extension of the scheme while taking aim at Treasurer Josh Frydenberg’s “wildly optimistic” budget update.
“Whether that is the level, or whether that is the dates on which JobKeeper is phased in and out, we will work cooperatively with the government on each of these things,” Mr Jones told media. “But I do want to make this point: tinkering with the guidelines is not a plan for jobs, and it’s not a plan for economic recovery. What want to see from the government [are] a plan for jobs and a plan for economic recovery.”