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Businesses jump at $130b wage subsidy plan

Published: (Updated: ) in Australian News by .

Businesses are rushing to sign up to the federal government’s $130 billion plan to subsidise wages during the coronavirus pandemic.

Businesses are rushing to sign up to the federal government's $130 billion plan to subsidise wages during the coronavirus pandemic.

Prime Minister Scott Morrison today said about 113,000 businesses had already signed up for the scheme announced on Monday, on the tax office website.

Treasurer Josh Frydenberg expects the plan would help thousands of employers and six million Australians.

A line of unemployed Australians at Centrelink in Rockdale, Sydney.

"It's enormous in scope and scale. But it does reflect the unprecedented nature of the threat," Mr Frydenberg told Today on Tuesday.

"We're effectively fighting a war on two fronts. A health crisis and an economic crisis."

In the unprecedented move, employees will receive a flat-rate payment of $1500 per fortnight through their employers in a bid to lessen the economic blow caused by coronavirus.

It applies to full and part-time workers, sole traders, as well as casuals who have been on the books for at least 12 months.

The subsidies will last for six months.

Mr Frydenberg said while there was more financial help for the country on the way, none of it would match Monday's announcement in dollars.

He said it would take years and years to pay off the debt generated as a result but the government had to what was needed.

Australia's six-month scheme was superior to similar government wage subsidy deals in the UK and NZ, where the packages only last three months.

Payments will flow to businesses in the first week of May, with the program to start from March 30.

EXPLAINED: How Australia's $1500 'Job Keeper' payment works

Workers stood down since March 1 will be able to qualify for backdated payments.

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New Zealanders on temporary working 444 visas and migrants eligible for welfare are also included.

People are seen in long queues outside the Centrelink office in Southport on the Gold Coast. Centrelink offices around Australia have been inundated with people attempting to register for the Jobseeker allowance in the wake of business closures due to the COVID-19 pandemic.

Mr Frydenberg told Today the huge lines he saw outside Centrelink when businesses started to shutdown were "heartbreaking".

"There will be other measures that we will announce over the course of the coronavirus crisis, and that just reflects the nature of the pandemic ... and its  economic impact."

Prime Minister Scott Morrison said some countries would face economic collapse or hollowing out in coming months as the disease spreads globally.

"In the very worst of circumstances, we could see countries themselves fall into chaos - this will not be Australia," he said.

Parliament could sit as early as next week to pass legislation related to the new JobKeeper payment, with Labor likely to support the overall package.

Unions and business groups have widely welcomed the announcement.

Business Council chief executive Jennifer Westacott said the subsidies were a fair way of making sure employees stayed connected to employers during the crisis.

"This huge package will keep people in jobs and vitally, make sure Australia is ready to rebuild quickly once this challenge passes," she said.

"We must safeguard as many jobs as we can to prevent long periods of joblessness and poverty."

The $1500 per fortnight payment amounts to about 70 per cent of the median wage.

ACTU secretary Sally McManus says while the decision was welcome, the amount may not be enough.

"We believe that allowing this amount to increase up to the median wage of $1375 a week is what is needed."

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It was also crucial that all casuals who could have reasonably expected to work now but had lost their jobs because of the pandemic are covered.

Many of these workers may not have worked for the past 12 months.

Labor has been calling for a wage subsidy for weeks.

Source: 9News

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