‘Next stimulus will be bigger’: PM’s plea to struggling businesses
Prime Minister Scott Morrison has asked businesses to hold fire on any further shutdowns or job cuts ahead of a third stimulus package to be announced in the next few days.
The package is expected to include a $1500 a fortnight "job keeper" allowance for those whose employers go into "hibernation" for the next six months, Seven News reported on Sunday night.
The government has so far announced two stimulus packages worth more than $80 billion aimed at trying to shield business and workers from the impact of coronavirus.
"The next stage ... will be even bigger than anything you have so far seen," Mr Morrison said on Sunday.
"It is part of the hibernation strategy of ensuring that we keep people connected with their businesses and with their jobs, so on the other side of this Australia can bounce back stronger."
As well as the wage subsidy, there is also expected to be an easing of restrictions on claiming benefits, and rental assistance for both business and individuals.
It comes at a time when economists are predicting a jump in the unemployment rate, possibly as high as 17 per cent.
The government has to date resisted the idea of a wage subsidy similar to the UK's, which would fund 80 per cent of the wage bill of a business so it can keep its workers on the payroll rather than having them join a lengthening dole queue.
Mr Morrison said it wasn't a question of just "cutting and pasting" what other countries were doing and that the government had been working to find a scheme to fit with Australia's system.
He asked businesses to hold off on any further decisions until they see the measures the government will be announcing in the next few days. "We will be ensuring also that those who have already gone into this very devastating situation, where they have had to stand down workers, that any measures that we're announcing will be taking them on as well," he said. Labor's industrial relation's spokesman Tony Burke said a wage subsidy needed to be implemented urgently.
"It has to be enough of a subsidy to give a real incentive to employers to keep people in their jobs," he said in Sydney.
Finance Minister Mathias Cormann said having doubled the level of income support under the JobSeeker payment, the government was also going to ease restrictions in terms of partner income.
This would ensure that those with partners who are seeking support would not be negatively affected.
The current partner income test kicks in once a partner earns more than $48,000. Several major companies including Qantas, Virgin Australia and Myer, and smaller companies - particularly in the hospitality and retail industries - have already stood down tens of thousands of workers.
Former ANZ chief economist Warren Hogan said the crisis had rapidly become an employment problem.
"I think a wage subsidy is critical at this juncture ... because we have such a significant amount of jobs losses," Mr Hogan told Sky News.
Treasury had estimated the impact of the coronavirus would see an additional one million people out of work, but already firms are shedding or have stood down between 60 to 90 per cent of their staff.
"I think very quickly we can talk about over a million jobs being lost. It looks like we are going to get through that in very short order," Mr Hogan said. "I think by the time we get to Easter we are going to probably see about 1.5 to 1.8 million job losses due to stand downs.
That would see the unemployment rate soar from 5.1 per cent as of February to somewhere above, between 15 and 17 per cent."
R.M WILLIAMS JOINS LONG LIST OF AUSSIE STORES FORCED TO SHUT
R.M Williams has become the latest casualty of the coronavirus retail crisis, with the iconic shoe brand closing its stores on Saturday.
The boot brand, which are been operating in Australia since 1932, said it survived World War II, but the virus had stopped it "mid stride".
R.M Williams did not say how many jobs would be lost from the closure.
Australian department store David Jones has also closed its small fashion stores - Country Road, Mimco, Witchery, Trenery and Politix, leaving 5000 staff without work.
David Jones' major retail stores will continue to stay open at this stage, but its smaller DJs stores at Sydney's Barangaroo and James Street in Brisbane have been closed.
Cotton On also closed after Myer announced it would close on Sunday due to the COVID-19 crisis.
In a statement on social media, Country Road said: "As a heritage Australian brand, we recognise that we have an important role to play in slowing the spread of COVID-19.
"Therefore, we have made the decision to temporarily close our Australian retail stores from end of day Saturday 28 March until further notice.
"This is a decision that has not been made lightly, and one we feel is necessary to protect the health and wellbeing of our team, customers and wider community."
The statement said shoppers can still buy items online, and they are offering free delivery on orders over $50, with free returns within 60 days.
"We are working closely with all team members affected by the store closures and are exploring the best ways to offer our support in the coming weeks," the statement read.
Trenery posted a similar note on their social media accounts, saying: "Today we unfortunately announce the temporary closure of our Australian Trenery stores from End of day today until further notice.
"This is a difficult decision we haven't made lightly, but it's the right thing to do to keep our customers and store teams safe."
The brand will remain available online.
Politix also announced its temporary closure, telling shoppers: "The POLITIX website will still be up and running - you can browse velvet tuxedos to your heart's content. And you'll still be able to chat to us via email and live chat.
"As it stands, our warehouse team will keep handling online orders, and we've put special measures in place to keep them safe. We've also started doing contactless delivery, so there's no need to sign for anything. Our partners will drop your POLITIX order right at your front door."
Witchery stated it would trade until Sunday and then close its doors until further notice, as shoppers were encouraged to go online.
Cotton On released a statement on Saturday which revealed they were also closing.
"From 5pm Sunday 29 March, all our AUS stores will be temporarily closed," the brand said.
"We want to say a huge thank you to our retail teams who have continued to amaze us with their hard work during this tough time. And to our customers, thank you for your support."
The moves have come ahead of any future shut down on the retail trade by government.
The retail giant told its workers it had been in discussions with the supermarket giants to find them alternative employment.
"We've reached out to the retail community, and specifically to those retailers in the essential goods sector who are looking for support in their store and distribution networks," it said.
"We have partnered with Aldi and Woolworths who we know will be lucky to have you because of your great skills and experience. There is an application process set-up for COG team members if you are interested and would like to apply for a role."
Cotton On employer more than 20,000 workers globally.
Myer closed on Sunday and stood down 10,000 staff without pay as the coronavirus continues to wreak havoc on Australia's economy, in a huge blow to Australia's retail sector.
"The health and wellbeing of customers, team members, their families and the broader communities in which we operate remains Myer's absolute priority," the company said.
"As such, Myer will temporarily close all stores from the close of business on Sunday (local time) 29 March 2020, for an initial period of four weeks until 27 April 2020.
"Our thoughts are with our team members, and their families, as we know this will be a difficult period, and, in addition to offering free counselling and support, we will look at further ways to support their health and wellbeing during this time."
Myer will continue to trade online and has dropped the threshold for free delivery to $49 per order. The store said workers will be working in a more sanitary environment to process online orders and send them out to customers.
10,000 staff in stores across the country and support office will be temporarily stood down without pay starting from Monday.
However full and part time staff will have greater flexibility to access annual leave and long service entitlements.
A small group of business-critical roles will be maintained to undertake essential work during the period and to support our online businesses, the company said.
"These roles will operate on an equivalent of 80 per cent of their normal salaries and contracted hours," the statement said.
The Myer Board, CEO and Managing Director John King, along with all of the Executive team members, have opted to not receive any remuneration during this period, but will continue to work in their respective roles.
Myer CEO, John King, said the decision to temporarily close all Myer stores and stand down staff is "one of the toughest decisions this company has faced in its 120 years of operation."
"Our focus must remain on operating our business in a manner that protects the health and wellbeing of customers and team members, whilst supporting the government, and the communities in which we operate, in limiting the spread of COVID-19," he said.
"We will focus on ensuring we offer the best possible online experience for our customers, whilst being ready to restart the business in four weeks.
"We thank our loyal customers and team members for their understanding during this unprecedented time," Mr King said.
Originally published as 'Next stimulus will be bigger': PM's plea to struggling businesses