Worst quarter ever
The Morrison government’s response to the COVID recession is not convincing
Confirmation that Australia is now in the worst recession since the Great Depression – the 7 per cent drop in economic activity from March to June is the country’s worst quarterly performance since records began in 1959 – increases the pressure on the Morrison government to maintain the current levels of income support, and to put off cuts to JobKeeper and JobSeeker. And the worst could be still to come, since the figures do not reflect the full impact of Melbourne’s hard lockdown. Declaring that the Australian economy had been “savaged” by the global pandemic and recession, Prime Minister Scott Morrison said it was a “devastating day for Australia”. Shadow treasurer Jim Chalmers asked the PM in Question Time this afternoon whether the government’s decision to “cut JobKeeper, cut JobSeeker and cut wages [would] make the worst recession in almost a century even deeper and even longer”. Morrison flicked that one to Treasurer Josh Frydenberg, who argued that, while JobKeeper was supporting 3.5 million workers and a million businesses, “we’ve always said the program was temporary, it was targeted, and that there would be a transition”. Frydenberg then embarked on a confidence-draining, point-scoring exercise about whose idea it was to reduce JobKeeper: “Not just those on this side of the house have said it should be tapered.”
On the government’s side of the house there was a desperate attempt at optimism. Resources Minister Keith Pitt talked up the performance of the mining industry: “There is a ray of hope for the Australian people and it is in the resources sector. [The sector] has grown 0.2 per cent in the June quarter, and that is up 1.1 per cent compared to last year. So it is a sector that has continued to grow and provide jobs.” Likewise, Agriculture Minister David Littleproud, when asked how that sector would help the Australian economy emerge from recession, said that since the instant asset write-off threshold was raised in July “there has been a 24 per cent increase in the number of tractor sales, 33 per cent in terms of bailors and 14 per cent in terms of front mowers. That’s a significant investment putting money back into local communities. We are seeing economic growth in these communities from these measures that are supporting not just agriculture, but supporting regional communities.” This is yet more evidence of the Coalition’s blinkered farm-and-quarry vision for the Australian economy.
Morrison pointed to promising payroll data, to the $10 billion of infrastructure spending (across water, energy and transport), and to the nebulous JobMaker scheme, which remains little more than a series of announcements. But none of this speaks of an overarching plan for the economy, which was stagnant before the pandemic and which the Coalition has been managing for seven years. The hard fact is that, with Victoria in the middle of a second wave and the ever-present danger of a second wave in NSW or elsewhere, and with unemployment rising and the economy likely to get worse before it gets better, the end of September is way too soon to begin winding back the key supports of JobKeeper and JobSeeker. The PM seemed to acknowledge the possibility that those plans may be revised ahead of October’s budget, telling parliament, “We will continue to calibrate these measures, as we have always done, in response to the economic circumstances that we face.”
This is not the time for ideological debates about whether government support is appropriate or how long it should be kept in place for. This is a genuine economic disaster – a time for Australians to look after each other. Morrison said a hallmark of his government’s response to the pandemic was that “every life matters”. He should show he means it.
Former prime minister Tony Abbott shares his perspective in a speech to a London think tank. He also attacked Victorian premier Daniel Andrews for wanting to extend a “health dictatorship for another six months”.
Profiting off the unemployment boom
As Australia grapples with an unemployment crisis, corporate
job agencies are benefiting from a boom in government payments. Some are being accused of pressuring those looking for work. Today, Rick Morton on who is profiting from Australia’s unemployment industry.
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Paddy Manning is contributing editor (politics) at The Monthly and has worked for the ABC, Fairfax, Crikey and The Australian. He is the author of Inside the Greens and the unauthorised biography of Malcolm Turnbull, Born To Rule?
Confirmation that Australia is now in the worst recession since the Great Depression – the 7 per cent drop in economic activity from March to June is the country’s worst quarterly performance since records began in 1959 – increases the pressure on the Morrison government to maintain the current levels of income support, and to put off cuts to JobKeeper and JobSeeker. And the worst could be still to come, since the figures do not reflect the full impact of Melbourne’s hard lockdown. Declaring that the Australian economy had been “savaged” by the global pandemic and recession, Prime Minister Scott Morrison said it was a “devastating day for Australia”. Shadow treasurer Jim Chalmers asked the PM in Question Time this afternoon whether...
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