The Federal Treasurer has all but confirmed the Government will extend the JobSeeker supplement, in some form, beyond its December expiry date.
Key points:
- Josh Frydenberg says the Government is "favourably disposed" to extending JobSeeker beyond December
- Half of all JobKeeper recipients are expected to be in Victoria later this year
- The Treasurer defended sourcing inspiration from conservative icons Margaret Thatcher and Ronald Reagan
The Government effectively doubled the former Newstart allowance at the beginning of the coronavirus crisis, by adding a $550-a-fortnight supplement.
From September, that supplement will be slashed to $250 a fortnight until December, taking the total value of the allowance to $815 a fortnight.
Josh Frydenberg has told Insiders the scheme is likely to be extended beyond that date.
"We're favourably disposed to continuing it, but we've got to do an assessment of where the jobs market is at that time," Mr Frydenberg said.
"It's about getting the balance right so that there are incentives for people to return to work, and at the same time, providing the safety net, the cushion to the blow."
Thatcher and Reagan 'figures of hate for the Left because they're so successful'
Mr Frydenberg also defended comments made last week, where he vowed to take inspiration from 1980s conservative leaders Margaret Thatcher and Ronald Reagan as he worked to rebuild the nation's finances.
After releasing a sobering update on the state of Australia's economy, Mr Frydenberg told the National Press Club a national focus on supply, like former UK prime minister Thatcher and former US president Reagan, could strengthen the economy.
Both leaders championed supply-side economics, which has three main pillars: lower tax rates, less government intervention in the market and monetary policy, specifically around a reserve bank's ability to increase or decrease money in circulation.
And both leaders are considered controversial.
Thatcher's push to tame inflation led to mass unemployment, while the merits of Reagan's move to slash individual tax rates are still being debated today.
But Mr Frydenberg described them as sources of inspiration.
"Thatcher and Reagan are figures of hate for the left because they were so successful," the Treasurer said.
"One got two terms, which was the maximum that you can get in the United States. Margaret Thatcher got 11-and-a-half years.
"But the reality is that Thatcher and Reagan cut red tape, they cut taxes and delivered stronger economies."
Shadow Treasurer Jim Chalmers seized on the comparison.
"This bizarre mini-Maggie approach to the economy will make a difficult situation even worse," Mr Chalmers said.
Half of JobKeeper recipients will be in Victoria
The Treasurer also revealed that in the final three months of this year, roughly half of all the JobKeeper recipients were expected to be living in Victoria.
Melbourne and the Mitchell Shire have been placed into lockdown, but Victoria continues to record concerning levels of the virus.
About 3.5 million workers currently receive the wage subsidy, and of those, about 1 million are in Victoria.
Treasury is forecasting that will decrease to 1.4 million people between October and December, with roughly half from Victoria, given the restrictions in place.
"But, again, it's a very fluid situation," Mr Frydenberg said.
The JobKeeper subsidy will continue until March next year, but payments will fall from $1,500 to $1,200 a fortnight after September.
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