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State and territory governments have been urged by the Treasurer to “think twice” before closing borders as JobKeeper comes to an end.
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Treasurer sends warning to premiers as JobKeeper ends
17 March 2021
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Treasurer Josh Frydenberg on Tuesday night told the annual dinner of the Business Council of Australia in a speech that, once JobKeeper expires come 28 March, the Morrison government will no longer shoulder the economic expense caused by border closures.
“The end of JobKeeper will also force state governments to think twice before they implement state border closures,” Mr Frydenberg said. “The economic consequences of such action are immense.”
The Treasurer urged states and territories to do more to sustain the economy’s recovery, saying they shouldn’t rush to close borders in response to outbreaks in other states, as has been the case over the course of the pandemic.
“When new cases arise, as they invariably will, the response needs to be targeted and proportionate while commensurate with the risk,” Mr Frydenberg said.
“At $251 billion of direct economic support, or 13 per cent of GDP, the federal government’s commitment was more than double that of the states and territories combined. This level of spending, which was always meant to be temporary and targeted, is now coming to an end.”
Mr Frydenberg’s calls for premiers to “think twice” before closing borders echoed similar advice offered by Prime Minister Scott Morrison, who last week suggested premiers heed the economic risks posed by such measures.
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The Morrison government’s $90 billion JobKeeper stimulus as well as the COVID-19 JobSeeker supplement are both set to expire on 28 March, with a continuation of JobKeeper off the cards despite opposition calls to extend it.
“JobKeeper had to end as its continuation beyond 12 months would be counterproductive to the economy propping up unsustainable business and preventing the more efficient allocation of workers and capital across the economy,” Mr Frydenberg said.
The Treasurer heralded the pace at which the economy has recovered, as it’s bounced back faster than both the Reserve Bank of Australia and the Treasury first anticipated, aided by private investment.
“What is particularly pleasing about the strong growth numbers in the December quarter is how the private sector is leading the recovery,” he said, “and our emergency measures, like JobKeeper and the coronavirus supplement, taper off.
“Dwelling investment, business investment, motor vehicles sales, job advertisements and household consumption are all significantly up.”
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