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JobKeeper and JobSeeker extended - here's how much you will receive

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With no end to the COVID-19 pandemic in sight, the government has made the call to extend but also reduce JobKeeper and JobSeeker, and boost the small business loans scheme. Here's what you need to know.

JobKeeper

The current JobKeeper scheme is set to expire on September 27. From then until March 28 next year, payments will be reduced and split into two tiers.

jobkeeper jobseeker small business loan extension

Date Full rate per fortnight Less than 20 hours worked/fortnight
September 28, 2020 to January 31, 2021 $1200 $750
January 4, 2021, to March 28, 2021 $1000 $650

The lower tier payment will apply to those working less than 20 hours a week, with the other tier for those who work over 20 hours.

Receiving payment during the first iteration of JobSeeker does not automatically qualify you for JobSeeker 2.0. Businesses whose turnover has recovered to above the threshold of a 30% decline will cease to receive payments from September 28, while businesses that can prove ongoing revenue less than 70% of pre-COVID levels will continue to receive support.

"While not all these businesses will necessarily make it to the other side, by tapering the payment and extending the JobKeeper program, we give them the best chance of remaining viable," says Treasurer Josh Frydenberg.

JobKeeper has largely achieved what it set out to do - keep people in work. Data from a survey undertaken by the Australian Bureau of Statistics found that 44% of employers kept on staff due to JobKeeper support.

In moving to the second version of JobKeeper, Treasury has recommended that the program should be limited so as to avoid work disincentives to work as the economy recovers.

JobSeeker

Like JobKeeper, the JobSeeker scheme will be extended and reduced. From September 25, the maximum fortnightly rate will be reduced from $550 to $250, while the maximum for a single household will drop from $1110 to $810.

Means testing for the scheme will also get tougher. The assets test and the liquid assets waiting period will be reintroduced and the JobSeeker Payment partner income test will increase from 25 cents for every dollar of partner income earned over $996 per fortnight to 27 cents for every dollar of partner income earned over $1,165 per fortnight.

Additionally, the taper rate will be simplified from a dual taper of 50 cents and 60 cents to a single taper of 60 cents, while the income free area for JobSeeker and Youth Allowance will increase from $106 per fortnight to $300 per fortnight.

Small business loans

The small business loans scheme will also be extended until June next year, with the maximum loan size increasing from $250,000 to $1 million.

The increased maximum loan amount will also be met with an extended term of up to five years.

The move follows revelations that banks loaned out far less than expected. While $20 billion was intended the scheme, only $1.5 billion had been loaned out by banks.

"The expanded scheme will shift from providing access to working capital to help businesses stay afloat during the crisis to now also enabling them to access more affordable and longer-term credit so that they can invest for their future," says Frydenberg.

The second phase of the scheme will start on October 1, 2020 and be available until June 30, 2021.

We're cutting through the confusion to help you manage your money during the coronavirus outbreak. Click here for more on how COVID-19 could affect your job, budget, super and investments.

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David Thornton is a journalist at Money magazine. He previously worked at Your Money, covering market news as producer of Trading Day Live. Before that, he covered business and finance news at The Constant Investor. David holds a Masters of International Relations from the University of Melbourne.
Comments
Mike Richards
July 22, 2020 8.34pm

It's an absolute joke, is what it is. You have two sorts of people - those of us who are still working (regardless of salary) and those who earn LESS than $1500 a fortnight who are now getting the full whack (if you don't believe me, read Scott Pape's column from a few weeks ago, where a uni student was getting it and had gone from earning $100 a week to this, and didn't know what to do with the extra cash).

My wife works in a bank and the amount of people who have been coming in to deposit their cash, then spend it all on smokes, grog and gambling is amazing.

Why would you ever want this to end so that you had to go back to work, if someone is paying you $1,500 a fortnight to sit around with the guarantee that your job is safe ?!

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