This week saw two major announcements from the Federal Government; the extension of income support measures (Jobkeeper and Jobseeker) and the first federal economic update since the onset of the COVID-19 pandemic in March 2020.
The announcements confirmed;
- Jobkeeper will be extended from September 2020 until at least March 2021, however, payments will be reduced from the current $1,500 per fortnight to a maximum of $1,200 per fortnight from October 2020 and a maximum of $1,000 from January 2021. Each businesses eligibility for the payments will be reviewed in both October 2020 and January 2021.
- Jobseeker will be extended by three months until the end of 2020, however, the Coronavirus supplement of $550 per fortnight will be reduced in October 2020 down to $250 per fortnight. For an individual on Jobseeker, this means their total payments would reduce from approximately $1,100 per fortnight to $800 per fortnight. An update on how Jobseeker will look in 2021 is expected in the October 2020 federal budget.
- Australia had a budget deficit of $85b in the 2020 financial year, with a forecast deficit of around $184b in the current 2021 financial year. As a percentage of GDP (Gross Domestic Product), these are deficits and debt levels not seen in Australia since the end of World War Two.
In the video below, Verse Financial Advisers Corey Wastle and Ashley Bishop provide a summary of these announcements, some historical context to Australia's financial situation and discuss what our clients should consider during these uncertain times.
General advice warning
The information provided is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser.