A looming overhaul of the JobKeeper scheme could leave the hospitality industry especially vulnerable. The sector has called for the payments to be extended.
A looming overhaul of the JobKeeper scheme could leave the hospitality industry especially vulnerable. The sector has called for the payments to be extended.

Extend JobKeeper or suffer ‘casualties’, says hotels boss

JobKeeper payments are likely to be overhauled, with a review next month set to consider which sectors still need the $1500-a-fortnight wage subsidy.

Federal Treasury boss Steven Kennedy, appearing before a Senate inquiry into the government's COVID-19 response on Thursday, confirmed there could be changes to the payment after his department's review in June.

Australia's hospitality sector wants the six-month scheme extended until at least December for the industries hit hardest by the coronavirus shutdown.

"As it stands, in September there will be a cliff that will see many casualties," Australian Hotels Association SA boss Ian Horne said.

"Hospitality and tourism simply won't be in a position to cover the wage cost that is currently being carried by JobKeeper.

"It may have to go into 2021."

JobKeeper had been "absolutely crucial" in keeping businesses afloat, Mr Horne said.

More than 54,000 SA businesses are now using the $130 billion scheme to pay employees' wages, with another 2000 signing up in the past week.

JobKeeper now supports 6.4 million Australians through 900,000 businesses nationwide - a massive jump since April 26, when 505,932 businesses were enrolled.

The Government has paid out more than $8 billion since May 1.

Dr Kennedy confirmed Treasury's review of the payment would look at whether it was working and if it needed to be more targeted.

"If sectors were recovering strongly and others weren't, that would be a very relevant consideration to the review of JobKeeper," Dr Kennedy said.

It would be difficult to make it more targeted, he said, adding there would be "messiness around the edge" of how to define sectors that were eligible.

Business SA chief executive Martin Haese urged the Government to consider extending the payment beyond September 27 for "specific and deeply impacted sectors".

"At a minimum, this extension should cater for businesses still likely to be significantly impacted by international travel restrictions," he said.

About 33,600 SA businesses have also received cashflow boosts of $20,000 to $100,000 from the Federal Government, totalling about $614.3 million.

Treasurer Josh Frydenberg said the payments were a "lifeline" for the "backbone" of the Australian economy.

Originally published as Extend JobKeeper or suffer 'casualties', says hotels boss



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