COVID-19 Update 3rd April

• National Cabinet meets today.
• Speculation that:
  • States and Territories finalised their commercial rent support packages last night
  • Victoria will push for commercial landlords to be part of JobKeeper scheme; NSW to focus on waiving or deferring land tax for landlords offering savings to tenants and a moratorium on rent increases (SMH)
  • Some states pushing for closure of shopping centres (Australian)
  • May get announcement of some sort of residential tenancies
• Nev Power, head of the new National Covid-19 Co-ordination Commission, talks up the ‘enormous opportunity’ to reboot Australia’s manufacturing industry. ‘It will be import replacement and we can take advantage of current market conditions and disrupted supply chains’. (AFR)
• NSW govt to give $10,000 to keep small businesses (up to 19 employees, turnover $75,000 p.a.) afloat, part of a Third Wave NSW package worth $750m
• Tasmania suspends horse and greyhound racing for next four weeks
• Mining employer group Australian Mines and Metals Association call for suspension of awards and enterprise agreements for six months; Attorney general Christian Porter rejected the proposal (‘Now is not the time for ambit claims for systemic or ideological changes’)
• COSBOA calls for suspension of unfair dismissal claims for crisis
• Allan Fels says domestic aviation rules (air cabotage) needs to be eased to assist foreign entry
• Australia’s largest tollroad operator, Transurban, gets criticisms from Deputy Prime Minister McCormack (‘last thing Australians need’) and NSW Transport Minister Constance (Australians ‘won’t forgive or forget’) for increasing road tolls.

COVID-19 update 2nd April

• Fair Work Commission has proposed changes during pandemic:
  • a new temporary workplace right giving workers, including casuals, access to unpaid pandemic leave if they enter self-isolation
  • allowing agreement to take twice the amount of accrued annual leave at half-pay
  • would operate until June 30
• Commercial tenants to be offered part deferral/part waiver on rents in package being prepared for Friday’s National Cabinet (AFR)
• Parliament will sit next Wednesday to pass JobKeeper subsidy. Only around 40 MPs.
• AMP Chair (and former Chair of Financial System Inquiry) David Murray warns against govt liquidity support for industry super (on moral hazard grounds)
• Government unlikely to bail out Virgin; more likely to encourage new entrant, say govt sources (AFR)
• Geoff Wilson (Wilson Asset Management), high-profile campaigner against ALP franking credit policy, says ‘everything must be on the table’ for paying back government debt. Suggests capping to make it ‘more equitable’.
• ACCI and COSBOA urge wage subsidy to be used to upskill during pandemic
• NSW government allowing constructions sites special permission to operate across weekends and public holidays (to allow better social distancing with fewer workers on site). (DT)
• NSW supermarkets and pharmacies also allowed to trade 24/7

1st April

• Exporters rescue package to be announced today. $110m for organising freight; $50m for Export Markets Development Grants programme; $10m in commercial fishing fees waived. Michael Byrne (ex-Toll) has been made International Freight Co-ordinator General.
• Some emerging criticisms of wage subsidy plan:
  • the required declines in turnover
  • how workforces are structured
  • some workers on lower pay now leapfrogging others
• Increasing deficit speculation:
  • Grattan Institute says gross debt would double in next three years to $1 trillion
  • Warren Hogan UTS says Budget deficits of $300b in next two years
  • RBC Su-Lin Ong says deficits of $100b over this year and next
• Treasurer and Assistant Treasurer say tax cuts will go ahead, and Cormann says submarine purchases will go ahead (AFR). (Albanese has said he reserves position on Stage 3 of tax cuts)
• Moody’s says Australia can maintain AAA rating if economic slump is temporary
• Finance & Treasurers Association (executives from top-200 companies) have written to govt seeking further protections such as a debt moratorium (AFR)
• G20 Finance Ministers meeting last night – Treasurer urged a ‘fiscal support tart=get, and keep supply chains open.
• Gladys Berejiklian is calling for businesses to ‘retool’ to help supply equipment
• Paul Kelly gives a ‘tick-tock’ on the development of the wage subsidy policy (as briefed – one presumes – by JF):
  • Discussions began in earnest straight after second package
  • Thursday 26 March – principles developed at dinner – PM, Frydenberg, Cormann, Treasury Sec Kennedy and Dep Sec Jenny Wilkinson
  • Frydenberg convos with four business people Richard Murray (JB Hifi), Rob Scott (Wesfarmers), Justin Hemmes (Merivale), and Solomon Lew.
  • Greg Combet tasked with engaging with ACTU
  • Frydenberg spoke with Tim Reed (BCA chief, MYOB) re payroll systems
  • Friday 27 March – Treasury, Frydenberg and Kennedy refining scheme, JF takes proposal to Morrison.
  • Saturday 28 March – Treasury updates costings. Treasury tells JF that ATO is good and that scheme can also apply to sole traders
  • Sunday 29 March – Expenditure Review Committee discusses, ATO Commissioner Jordan says ‘we can deliver this’
  • Monday 30 March – ERC oks, then full Cabinet oks, then announced at 4pm

31 March 2020

• Govt’s wage subsidy plan gets broad support – business groups, ACTU and ALP.
• 60,000 businesses have registered for wage subsidy overnight
• Virgin Australia asks for $1.4b govt loan. Mathias Cormann, without responding directly, says that the government wants two airlines when we come out of crisis. (Eight regional airlines asked for bailouts last week)
• Qatar Airways announces increasing flights to Australia, with new route Brisbane to Doha
• Assistant Minister for Super Jane Hume criticises industry super funds with membership drawn from a single industry for ‘structural weakness’
• ACCC chief Rod Sims indicates he will look through the present crisis in determining merger decisions
• NSW Deputy Premier tells city people to ‘stay away’ from rural and regional Australia.
• Seven biggest sports (Cricket Australia, NRL, AFL, Tennis Australia, FFA, RA) have jointly sought support from Sport Minister Colbeck.
• Essential Poll shows increasing concern (53 per cent now ‘very concerned’)
  • 20% say they will be in serious financial distress if there is a short-term loss of income.
  • 88% support closing borders
  • 82% support for direct payments for people losing work due to Covid-19
  • 81% support for closing pubs, clubs, restaurants, cafes
  • 80% support for direct payments to SMEs who are losing money
  • 69% support for distance learning at schools

30 March 2020

• Wage subsidy will be announced later today, will use existing tax and transfer system, legal obligation to keep employees
• Speculation that wage subsidy:
  • $1500/fortnight, capped at middle income workers
  • concern that a UK 80 per cent system would be inequitable,
  • being referred to as ‘job keeper allowance’.
  • likely to target full time employees over six month period.
  • will need to be legislated
• Eviction moratorium details expected over the next few days (though states already started to take steps – TAS, NSW given powers to amend / suspend clauses in the RTA etc ) and clearly linked to the other initiatives including the deferral of loan repayments. Messaging suggests that limited to financial stress
• Treasurer Frydenberg last night changed FIRB rules to now scrutinise all foreign investment ‘regardless of value or nature of foreign investor’.
• Banks to announce today loan repayments for almost all Australian businesses will be deferred
  • Businesses with loans up to $10m will be able to defer their loan repayments for six months, above that level case-by-case
  • Speculation Government will lift the SME 50 per cent loan guarantee to include big business (Australian)
• Senator Andrew Bragg has criticised industry super for being too reliant on illiquid assets
• Expenditure Review Committee meeting today, will discuss Stimulus Mark III

27 March 2020

• National Cabinet to meet (virtually) this morning
  • Discuss tighter measures, but NSW says looking at infection rates before any shutdown.
  • Rent still a major issue – it is who pays for it
  • the ‘hibernation’ concept gaining currency – businesses protected to get them through
  • speculation around underwriting commercial rents, rates and utility bills
  • Report (DT) that Treasury is also looking at flat-rate wage subsidies (not the UK 80% UK system)
• Albanese flags longer term changes:
  • ‘need to look at casualisation’ and insecurity at work
  • ‘need to look at contracting out the workforce, particularly for public sector jobs’ (gives example of Centrelink)
  • needs to be ‘massive expansion of social housing’
• Liberal backbenchers (Andrew Hastie, Tim Wilson) have raised concerns about foreign investors (chiefly from China) buying distressed Australian assets
• The SMH says Treasurer Frydenberg has ‘privately expressed concern’ about this, and that FIRB is alive to the issue.
• G20 meeting was last night; Australia looking to assist Pacific neighbours
• Some of you may have seen that REIA president suggested there should be no forced evictions for six months  – while strongly suggesting compensation to landlords

• PM has hook-up with G20 leaders today, wants to stress keeping supply chains open
• National Cabinet last night:
  • agreed on an expansion of testing for frontline staff (to all healthcare workers)
  • agreed to freeing up hospital beds by cancelling all elective surgery.
  • next National Cabinet on Friday
• State governments are starting to act more individually (Vic govt flagging Stage Three restrictions, and NSW and ACT pressing in this direction)
• Rent issue growing
  • Report that states planning to block landlords evicting tenants
  • Vic Premier said rent issue ‘hardship-based’ support would be announced by PM today
• Federal Labor becoming more openly critical
  • urging more stringent shutdown
  • said there is a strong argument for closing schools
  • urged fast-tracked third stimulus
  • rejected premise of ‘balancing’ economy and health
  • supportive of wage subsidies a la UK approach ‘so that employers have incentive to retain workers)
  • urged government to make safety net ‘wider, stronger, and more substantial’
  • continuing criticism of allowing early access of super for hardship
• Increasing pressure for Govt to look at UK (and others) wage subsidies  Australian Retailers Association and COSBOA (and Unions)
• Speculation energy industry will stop power disconnections, waive late fees, for Covid-19 impacted people  (to be announced today
• AMA pressing for school closures, and teachers unions also pressing strongly (influencing ALP)
• Barnaby Joyce urges action against profiteering by credit card providers and payday lenders
• WA introduced liquor rationing – one carton of beer per day

25 March 2020

The last press release on the latest round of measures from the PM’s office on 24/03/2020 can be viewed here.

In summary:

• National Cabinet will meet again tonight
• Rent is a key topic, with concerns about business and individuals being evicted for non-payment
• United Workers Union has done a deal with the AHA to help hospitality industry (to cut minimum hours requirements, suspend rules on job classifications, relax rules on when staff can be directed to take leave)
• Speculation that a major mental health package will be coming
• Parliament could potentially sit by videoconference, Government and ALP have agreed.
• Pay freeze for top public servants and staffers
• Govt are fast-track reviewing Singapore App TraceTogether, an opt-in BlueTooth tracer of personal physical contact (to overcome people’s faulty memories)
• There are lots of border issues within Australia – freight etc
• There is increasing speculation about the future of guest worker schemes (how sustainable they are if there is mass unemployment)
• Super funds, concerned about large scale ‘hardship withdrawals’, are looking for government underwriting of liquidity
• Unemployment is an enormous issue. Centrelink capacity/eligibility are issues of the moment, but will shape the political landscape for a long time to come.

24 March 2020

Contradictory messages from overseas overnight

In UK, PM Johnson has announced radical isolation, no going outside your house unless absolutely necessary.

In US, President Trump is asking whether ‘the cure is worse than the disease’.

• Last night (23 March) the second stimulus package passed, the Australian government also set aside an extra $40 billion for use on Covid-19 response
• Called the Advance to the Finance Minister, its normally just $1.2b
• Gives Finance Minister the ability to spend money in a period where Parliament may not sit, or for expenditure that is urgent or unforeseen.
• Limited to next financial year.
• Could be used on purchasing medical equipment, or paying states etc etc
• Labor negotiated some extra conditions:
• A weekly media release will be issued publicly after every use of the Advance to the Finance Minister; and
• For any proposed use of the Advance to the Finance Minister greater than $1 billion, the Government will seek written approval from the Opposition.

• Much attention is now on the unemployed, and pressures to do more in this area will obviously grow 

20 March 2020

PM and Treasurer press conference:

Federal Budget to be delayed to October 6th
One person per 4 square metres indoors restriction
People should reconsider any unnecessary travel
Flagged potential lock down of neighbourhoods
Relief for tenants in both commercial and residential tenancies (states-led initiative)
Extra aged care funding $446m
Chief Medical Officer stepped up the urgency of social isolation

Separately, the government has appointed Greg Combet to be a Special Adviser on the workplace effects of Covid-19

Watch the press conference here (SBS)

Scott Morrisson announced:

States agreed to work together to identify how relief can be provided for residential tenants: how to provide relief for tenants in hardship, and go through tenancy law to protect those tenants facing hardship to stay in their tenancies over the next 6 months.
WA Government is working with NSW Government in bringing back a framework. They will consider the appropriate triggers for hardship, and what circumstances will be considered to ensure tenants can stay in tenancies. Landlords will have their role to play (for example taking a hit, sharing the burden of the situation)

With the COVID-19 (coronavirus) outbreak causing significant community concern and many people losing their jobs or finding their incomes much reduced, community housing organisations (CHOs) as responsible landlords recognise we have an important role in mitigating the impact on our tenants and other service users.

We agree with the UN Special Rapporteur, Leilani Farha, when she says ‘Housing has become the front line defence against the coronavirus’ and we share her concern for the homeless and those at risk of homelessness due to financial hardship resulting in rent or mortgage arrears.

CHIA member CHOs are already taking steps to respond to the coronavirus. They are committed to maintaining tenancy services, safeguarding residents and staff, and minimising the risk of exposure. Most have already written to or met with tenants to provide advice and are working with others to ensure that the particularly vulnerable get the help they need.

By taking the action outlined in its second stimulus package to support the incomes of people who are made jobless, the government will not only help prevent evictions but also reduce the accumulation of rent arrears and thus enable a more rapid recovery from the health crisis.

We are also calling on our tenants to prioritise rent payments. Our members rely on rental income to pay for the services we offer. By continuing to pay their rent, tenants can also help us to offer assistance to those in significant financial hardship as a result of this public health emergency.

We are also acutely aware of the risk that eviction poses to any tenant, particularly at this time, and fully understand the calls to halt all such actions. During this crisis, possession action should be progressed only as a last resort in extraordinary circumstances – for example, where tenant misconduct is placing other residents (or staff) at serious risk in terms of health or safety. In any such extraordinary cases we will work with other agencies to minimise the harm to the individual.

Our members will, of course, work closely with relevant government agencies in responding appropriately to any serious problems at the individual case level. But our sector will also need government commitment in ensuring that once the pandemic has receded, we are strongly placed to continue providing vital tenancy services, and helping to redress Australia’s growing social and affordable housing shortfall.

We expect that, as the impact of the Coronavirus becomes clearer, so will our specific requests for government support. Already we are clear that governments – at both Federal and state/territory levels – can assist through:
• Pledging to extend measures that support the incomes of people made jobless should this prove necessary. We need to prevent the accumulation of rent arrears and other debts

• Strong leadership and co-ordinated management to enable health, aged and social services and housing providers work together to minimise the impacts on tenants and staff

• Increased funding for services assisting people in financial hardship – particularly financial counselling and debt advice• Increased funding for mental health services to support our work with the most vulnerable
• Support to enable expanded crisis accommodation (and associated services) so that those who are homeless or at risk of homelessness do not need to be on the street
• Regular dialogue so that we can together assess the impact on CHOs’ services and our members’ businesses and, the necessity of additional support being provided to the sector. Such a forum also provides an opportunity to jointly consider initiatives that will mitigate adverse impacts on our communities
• Working with the sector to develop and implement an economic stimulus package for the construction of new social and affordable housing to meet the already large and growing shortfall. Such an approach has been successful in the past. This will get people working and speed up the recovery from this crisis.

We are committed to ensuring that our tenants continue to receive high quality services throughout this period. With our partners in the not-for-profit, private and government sectors we can do this.

Wendy Hayhurst

Chief Executive

Community Housing Industry Association

18 March 2020

At his morning press conference, the PM, Scott Morrison made the following points:

• Looking at six months for measures, but could be longer or shorter
• Any measures needed  – you should be prepared to have them in place for six months at least
• No lock down is planned
• Indoor crowds limited to 100 for non-essential gatherings – (not public transport, medical and emergency services, courts, airports and shopping centres)
• Schools will stay open, state governments all agree
• Strong message to ‘Stop Hoarding’.
• Aged Care – limitations on visitors to aged care residents (short times, two visitors at one time per day, no-one who has been exposed, no groups, no school groups).
• Special arrangements for those on end-of-life (facility by facility)
• ANZAC Day events cancelled (but televised event will occur)
• Travel advice tightened – ‘do not go overseas’. Bans on people entering not ruled out (this was in response to question)
• Up to individual sporting codes whether to stop games
• RBA considering measures over next 24-48 hours
• Second stimulus being worked on
• Budget still on May 12 –  That’s the current plan.