Three steps back to normal

Prime Minister Scott Morrison, speaking after today’s national cabinet meeting, presented a three-stage framework for rolling back lockdown restrictions over the next two months – aiming for “a COVID-safe economy”, as he put it, by July. Lauding Australia’s success in making its way through the pandemic on both economic and health fronts, Morrison released details of the three steps towards opening up the country again, with the staggered rollout giving health authorities room to monitor how each change affects infection rates and risk. Ultimately, though, it will be up to the states and territories to determine the timing of when restrictions are lifted in their jurisdictions. So, when will step one kick in? South Australian premier Steven Marshall has already announced that SA will relax social-distancing measures from Monday, while Victorian premier Dan Andrews says that nothing will change in the state until at least Monday, when the results of a raft of new tests will be fully analysed. Annastacia Palaszczuk flagged Saturday week for the first set of changes back towards normal in Queensland.

Step one will allow gatherings of up to 10 people, and five guests in your own home; public playgrounds will open and recreational activities such as golf and tennis will be allowed; retailers and small cafes and restaurants will re-open; local and regional travel restrictions will be lifted; and there will be an easing of restrictions for funerals (up to 20 attendees indoors), weddings and religious gatherings (up to 10 attendees allowed). People will continue working from home if it suits employee and employer, and most children will be encouraged to return to school (although Victoria is not preparing to allow all students to return to school this term).

Step two, Morrison said, “will allow larger gatherings of up to 20 people, including for venues such as cinemas and galleries, more retail openings on sector-based COVID-safe plans, organised community sport, and beauty parlours”, among other things. Some interstate travel will be allowed.

Step three will allow gatherings of up to 100 people in most circumstances. Most workers will be back at work. Pubs and clubs will open. Interstate travel will be back to “normal”.

More information on steps 2 and 3 will be formulated depending on circumstances, however not everything will return to normal within the next two months. For example, “there’s nothing on our radar which would see us opening up international travel in the foreseeable future,” Morrison said.

There will be risks, challenges and outbreaks, as well as setbacks and inconsistencies, he added, but these would not disrupt the staged unwinding of restrictions if they could be kept in check.

Treasury has estimated that of the million jobs lost to the pandemic, 850,000 will be restored in the coming months, following the removal of all restrictions. This is an admirable goal (and a courageous prediction, to borrow from Yes, Minister), and one that is clearly at the front of Morrison’s mind – but it seems unlikely.

Some parts of the economy cannot snap back – travel and tourism, arts and entertainment, higher education, to name but a few – and others will be facing global headwinds unlike any we’ve seen in our lifetimes. To give a taste: the Bank of England has warned that Britain could be headed for its biggest economic slump in more than 300 years, forecasting a 14 per cent contraction in the UK economy this year. Car sales in the UK were down 97 per cent in April.

In America, another 3.2 million people filed for unemployment last week, making 33 million in total. That’s one in five American workers who have lost their jobs as a result of the COVID crisis.

The Chinese economy, upon which Australian relies so heavily, has also contracted in the past three months ­– for the first time in decades.

A global recession, or depression, will have incalculable effects across the Australian economy, and the idea that all but 150,000 jobs will return in the coming few months, as restrictions are eased, seems fanciful. And to get that kind of result, the government will need to do a lot more than simply ease restrictions; it will certainly need a lot more in its arsenal than the traditional right-wing triumvirate of tax cuts, less regulation and weakened IR laws. Unfortunately, our leaders show no signs of updating their thinking yet.

In the meantime, Australians can count some blessings: there were 14 new cases in Victoria, but just four new cases in NSW, one in WA (its first in nine days), one in SA (its first in 14 days), none in Queensland, and just a handful across all of Tasmania, ACT and NT over the past week.

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