COVID-19 – Melbourne – Stage 4 Restrictions

It’s safe to say we weren’t prepared for this but there are Government programs available to help.

In early July 2020, Victoria reverted back to Stage 3 restrictions for Metropolitan Melbourne and the Mitchell Shire in an attempt to contain the spread of COVID-19. On 3 August 2020, in a year of constant ‘unprecedented’ announcements, actions and circumstances, the Victorian Government took another step beyond when it announced Stage 4 restrictions and the tightest lockdown measures yet.

Impact on Business

In addition to limiting civilian movement, much of the economy is either being forced into shutdown, or significantly reduced output. The Premier has outlined three categories as follows:

  • Remaining open & operating as usual: in addition to frontline healthcare, this will include supermarkets and grocery stores, bottle shops, petrol stations, banks, news agencies and post offices.
  • Required to close: From 11:59pm on Wednesday 5 August many retailers, manufacturers and administration/professional services businesses will need to close their doors. Some retailers will be permitted ‘click and collect’ contactless purchasing.
  • Scaled back: Some businesses will be permitted to operate as usual, but at much lower capacity.

For scaled back businesses, the key points are:

  • Meatworks must scale back operating capacity to two-thirds, in addition to strict safety protocols.
  • Warehousing and distribution centres will be limited to no more than two-thirds normal workforce allowed onsite at a time.
  • Construction industry will have three different settings:
    • Large scale projects with government involvement will be considered case-by-case
    • Large scale projects over three stories will need to reduce the workforce to a number that is a ‘practical minimum’. There will be a maximum of 25% staff working on site and the business must have a High Risk COVID Safe Plan
    • Small scale projects that are underway may remain open, but are not permitted to have more than five people on site at any one time. This includes domestic homes.

A table detailing the directions for each industry sector is available at the DHHS website.

As an update to last month’s article, below we provide a reminder of the main Government programs available.

JobKeeper

The JobKeeper program is still running and it is important to note the following:

  • Employers/businesses who were not eligible at the start of restrictions can enter the program now if they meet eligibility criteria, including the decline in turnover tests.
  • The program will run unchanged until 27th September 2020.
  • Support for the child care sector was withdrawn in July.

Jobkeeper has been extended into phase two beyond 27th September 2020, but does require that businesses re-test their eligibility. At the time of writing, it is not known whether there will be any Victoria specific measures provided for with ongoing Jobkeeper payments. Our summary of JobKeeper 2.0 as it was announced is here.

Our initial update and overview of the JobKeeper program is available.

Victorian Government Lockdown Support Program

This was announced on 30 June 2020 to support the original specific postcodes in Victoria which were forced into Stage 3 lockdown before the rest of Metropolitan Melbourne. It has now been extended and applications are open until 14th September 2020. It will provide grants in Metropolitan Melbourne and the Mitchell Shire of $10,000 and $5,000 to employing businesses in regional local government areas that:

  • Have employees; and
  • Are registered for GST; and
  • Have payroll of less than $3 million per annum; and
  • Had an ABN as at 16 March 2020; and
  • Have been engaged in carrying out the operation of the business in Victoria on 16 March 2020.

For businesses in Metropolitan Melbourne that have recently applied for the $5,000 grant, there is no need to reapply, as these will be automatically upgraded to $10,000 grants.

Tourism Accommodation Support Program

Also announced on 30 June 2020, this is designed to support regional Victorian accommodation providers impacted by the original lockdown on the 10 postcodes mentioned above. The program offers financial support of up to $225 per booking per night.

This applies to bookings made before 3pm on 30 June 2020 for travel that was planned between 1 July 2020 and 29 July 2020. The following criteria need to be satisfied and proven:

  • A refund is made for 100% of the booking amount; and
  • No cancellation fee or other tariff was charged for cancellation; and
  • The cancelled booking was not re-booked; and
  • The booking is from a resident of a restricted postcode.

You can register your interest here.

Coronavirus SME Guarantee Scheme

As part of the original economic response to the pandemic, the Federal Government made several changes designed to support the flow of credit and provide easier access to loans to SME businesses (generally those with a turnover of under $50 million). The loans are intended to be unsecured, but 50% guaranteed by the Government, with a $250,000 limit and a 6 month repayment holiday. The loans are for up to three years.

The loans are provided by banks and financial institutions. Treasury has further details here.

$1,500 ‘disaster payments’ for workers without leave

The Federal and Victorian Governments will be funding a $1,500 payment for workers that are required to self-isolate for two weeks due to coronavirus, but who do not have leave entitlements, or access to payments through JobKeeper or JobSeeker. The payment is available each time a worker is required to isolate.

The payment is currently linked to the ‘state of disaster’ in Victoria and can be extended to other States if similar situations occur there.

Further information is available from the DHHS here. There is also a $300 employee isolation payment available in certain circumstances. Further details are here.

JobSeeker

JobSeeker is available for people who are looking for work and aged between 22 and Age Pension Age. There are income and asset tests and if someone is in receipt of JobKeeper, they cannot access a JobSeeker payment.

Services Australia has a JobSeeker website here.

Early release of superannuation

People who are financially affected by the pandemic can access up to $10,000 of their superannuation between now and 24 September 2020. Applications for this are done through the myGov website.

To apply for early release of super you must satisfy at least one of the following:

  • You are unemployed.
  • You are eligible for JobSeeker, youth allowance for job seekers, parenting payments, special benefit or farm household allowance.
  • On or after 1 January 2020:
    • You were made redundant; or
    • Your working hours were reduced by 20% or more; or
    • You are a sole trader and your business was suspended or there was a reduction in your turnover of 20% or more.

It is important to note that superannuation should not be accessed simply for the purpose of re-contributing the amount to claim a tax deduction. Furthermore, early withdrawal of superannuation should be carefully considered, as taking $10,000 out now can have a big impact on your balance of retirement savings once you reach retirement age.

Treasury has a website for household support during COVID-19 here.

Please contact your Accru Melbourne representative on (03) 9835 8200 if you have any queries about the points above or if you would like to discuss your current situation.
About the Author
Daniel Arnephy
Daniel is our technical expert for all your taxation needs. His diverse network and client base allows him to continuously build his knowledge and analyse every situation he is faced with an experienced outlook.
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