JobKeeper is the scheme to keep people in their jobs by subsidising employers.
It was meant to tide employers and employees over the economic crash that the coronavirus might cause. It's administered by the Australian Tax Office and the payment from the federal government goes to employees via their employer.
JobSeeker is the unemployment system which pays benefits to those without work and puts obligations on them. It's a long-standing scheme which was modified as the wave of virus-induced redundancies swept over the economy.
What are the changes to JobKeeper?
The government said the JobKeeper scheme would stay until March 28 next year - but there would be changes to the payments made and to the rules laying down which companies would be eligible for the subsidies.
The existing payment to each employee of $1,500 a fortnight (before tax) will continue until September 27 this year - so if you get it now via your employer, that will be unchanged until then.
But from September 28, the payment will drop to $1,200 a fortnight and from January 3, 2021, it will drop to $1,000.
What about employers?
Employers won't automatically continue being eligible for JobKeeper when the first step of changes comes in at the end of September.
To be included up to now, they had to show that the coronavirus had seriously hit their incomes by comparing turnover (the amount of money coming in from trade) when the virus hit with turnover for the same period last year.
They'll have to do that again and show that their businesses continue to be hit.
The criterion will be the same. There will have to be a 30 to 50 per cent fall in turnover for smaller businesses to keep getting JobKeeper.
Bigger businesses (with a turnover of more than a billion dollars a year) would have to show it had fallen by 50 per cent.
On top of that, businesses will have to show that the fall dates back to the start of the coronavirus crisis. They would need to prove they lost money from June onwards.
If you as an employee are currently getting JobKeeper but your employer can't remake the case that the business is still being damaged substantially, the payment will cease.
It seems likely that the process employees went through before to make the case for eligibility will have to be repeated.
These changes are estimated to cut the number of people eligible for the JobKeeper payment from the current 3.5 million to about a million.
What about part-timers?
JobKeeper will become a two-tier system with one payment for full-time workers and another for part-timers.
If you were a part-timer, working less than 20 hours a week, "pre-covid", as Treasurer Josh Frydenberg called it, your JobKeeper payment will be cut from $1,500 to $750 a fortnight from September.
And then at the start of next year, it will fall to $650 a fortnight.
What about JobSeeker?
When COVID-19 hit, the government introduced a supplement of $550 a fortnight to the existing JobSeeker payment payable to those out of work and available for work.
The government says: "The Coronavirus Supplement of $550 per fortnight is available until 24 September 2020.
"Beyond this date, the Coronavirus Supplement will be available at $250 per fortnight until 31 December 2020."
On top of that, from September 25, you will have your income and savings assessed to get the supplement.
There will also be a change in how much money you can earn before the supplement is cut.
"The income free area for these payments will increase to $300 per fortnight," the government said.
"The income free area is currently $106 for JobSeeker Payment and $143 for Youth Allowance.
"If you earn above $300 per fortnight, your payment reduces by 60 cents for each dollar over this amount."
What about "mutual obligations"?
These are the obligations an unemployed person has in order to get unemployment benefit - JobKeeper. If the obligations aren't met, the money isn't paid.
They have been waived for the past three months as the virus has decimated the jobs market but they will be re-introduced on August 4.
The government says job seekers with providers (agencies connecting job seekers with employers) will be required to:
- undertake appointments with their employment services provider. This can be done online or over the phone or in exceptional circumstances in person.
- agree to a Job Plan - the Job Plan sets out what a job seeker agrees to do while on payment and moving towards or back into employment.
- undertake up to four job searches per month, tailored to local labour market conditions and
- participate in training or other activities, either online or in person where safe to do so.
Job seekers who get income support payments will be expected to accept offers of suitable paid work or lose their benefit.
What about after December?
The government is waiting to see how the economy and the health situation pan out.
It's also worried that subsidising jobs distorts the labour market. The argument is that if the government is paying people to stay in work, the economy suffers because there's no incentive to make necessary changes.
If it turns out that the recession is not as bad as forecast and if the virus is brought under control faster than predicted, support will be taken away more quickly.
"We'll be making further announcements about what happens with JobSeeker post-December in a few months," the Prime Minister Scott Morrison said.
"We need to make those decisions closer to the time to have a better understanding of where the economy is at, remembering the JobSeeker arrangements have more of an impact on incentives in the labour market."
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