'Incredibly difficult': Aussies face financial stress as COVID payments are cut off
Coming out of lockdown may not be what you hoped. If you are one of the 1.7 million people receiving COVID related disaster payments in NSW, Victoria and the ACT, it could mean financial turmoil and distress.
This is because the benefits paid over the past three months are being withdrawn before many incomes have recovered.
Currently the weekly payments provide $450 for those who have lost fewer than 20 hours of work a week and $750 for those who have lost more and not receiving Centrelink or Department of Veterans' Affairs (DVA) payments. For anyone on income support (Centrelink and DVA) who works up to eight hours per week, they can receive an extra $200 a week.
But these Federal government payments will be withdrawn once the vaccination rates climb and lockdown is wound back. In NSW this could happen on Monday, October 11 while the ACT opens up on October 15 and Victoria will exit lockdown in the second half of this month.
The race to force the state governments to open up means that not all businesses are set up to open at their old hours, employing all their former staff. Also there could be restrictions with capacity numbers still in place for some businesses such as restaurants, cinemas and theatres. Also there could be hesitancy among the vaccinated to go out if there are COVID cases in the community.
And some areas could go into lockdowns again if there is a surge in cases.
What happens to COVID relief payments?
Once 70% double vaccination of the over 16s is reached, people have to reapply each week while a Commonwealth hotspot declaration is in place to confirm they can continue to receive the payment.
At 80% double dose vaccination, the payment will reduce over two weeks. In the first week, a flat $450 will be paid to anyone who has lost more than eight hours of work. Those on Centrelink and DVA income support who have been working will get $100.
In the second week the payment drops to $320 and ends for anyone on income support.
After the end of the second week, all COVID related payments end, even if your area is affected by movement restrictions. The fallback benefit is the inadequate $320 a week JobSeeker payment.
This is in contrast to last year when the COVID payments lasted long after the lockdowns ended.
Many communities across Australia will be left with inadequate support, according to research by ACOSS and the UNSW Sydney Poverty and Inequality Partnership. Damage will be felt by people in areas such as west and south-west Sydney, outer north-west and south-east Melbourne, northern Adelaide, far North Queensland and regions between Brisbane and the NSW border.
"This year is a starkly different story. COVID has left a scorched economic path particularly in areas that were more disadvantaged pre-pandemic, says ACOSS CEO Dr Cassandra Goldie.
"In so many communities, we are leaving people behind. In 2021, the disaster payments left gaping holes. Those who lost employment or paid hours a week before or after a lockdown have received nothing beyond the existing grossly inadequate income support payments, such as the $45 a day Jobseeker payment."
"Just because someone has the bad luck to live or work in a community affected by another wave of lockdowns, they have been locked into poverty," explains Professor Carla Treloar, director of the Social Policy Research Centre at UNSW. "Those people and families affected the most will find it incredibly difficult to reconstruct their lives."
State governments have announced some tapered continuing payments as vaccination rates climb, largely for businesses.
New South Wales
NSW will extend some benefits for businesses and sole traders until November 30 after it reaches 80% double vaccination target. Known as JobSaver, the payment will decline from the current share of weekly payroll from 40% to 30% on October 10. When 80% double does, JobSaver will drop to 15% and end on November 30.
The micro-business grant for sole traders will drop from $1000 fortnightly to $750 on October 10 and then $375 a fortnight once 80% is reached before ending on 30 November.
The eviction moratorium to restrict landlords from evicting for tenants who couldn't pay all their rent ended on September 11 in NSW.
The ACT is offering additional transitional business grants for businesses employing people as well as sole traders. The amounts are based on business turnover. It is also offering grants for tourism, accommodation, arts, events, hospitality and fitness businesses as Canberra's economy is gradually reopened in October and November.
Victoria expects to reach 80% double vaccination rates early late October or early November.
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