OPINION: Uncle Morrison, Thumbs Up to your Jobkeeper Policy

• Published on
• 29 Apr 2020, 09:45 AM

By Sophia Rodrigues

“I think Uncle Morrison has been very smart with the Jobkeeper policy,” said Delilah to me one evening.

“How’s that?” I asked, curious that Delilah is finally showing some interest in things related to my work.

“Because he is giving money to those who will spend, and that will help the economy,” was her answer.

(I must admit here I was glad to hear the latter because spending helps the economy is a line I have said many times at home but no one ever showed interest in my comments).

Delilah is my 20-year old daughter, currently studying law and criminology full-time. She also works part-time at a clothing retail store where she ends up doing on an average 55-60 hours a fortnight because she likes her work, and of course, she likes her money.

When our PM Scott Morrison announced Jobkeeper policy a few weeks back, my immediate reaction was the policy was a bit stretched because it was offering A$1500 a fortnight even to those that were previously earning much less than that.

Personally, I was not sure if Delilah deserved it too but of course she would disagree. She had been working in the store for over two years as a casual, but because the store made a decision to temporarily shut, she lost her income. But now she was likely to qualify for the Jobkeeper payment.

Last week she was officially told she had qualified and so had few other girls who were working less than 20 hours a fortnight, some just 10 hours.

Two such girls were 17-year old schoolgirls who were happy with the idea of receiving A$1,500 a fortnight.

“We can’t wait for the lockdown to end because we want to go and spend the money,” said the girls.

Following a recent update in the eligibility criteria for the policy, these girls will no longer qualify but because they have already been paid, they don’t have to return the money.

But A$1,500 is still a big amount for them and like a windfall. They are schoolgirls, so they don’t really have a savings plan. They are happy to spend it, including on technology.

And so are the other younger people who continue to qualify.

Morrison and his team know that. Between giving money to those who are more likely to spend (to meet their needs and more) and those who would save, he has favored the former.

By doing this he has created a big pent up demand backed by the financial resources to meet it, that is waiting for the lockdown to ease or end. Once that happens, it will be spent.

And that spending would help the economy. Maybe even help us avoid a technical recession. Fingers crossed.

So, a thumbs up to you Uncle Morrison from Delilah.

--Contact: sophia@centralbankintel.com