JobKeeper rules to change due to Victorian outbreak

Prime Minister Scott Morrison has warned the tough restrictions in Victoria will cost the national economy between $10 billion and $12 billion and push unemployment closer to 10 per cent.

Under the bleak forecasts for the economy, the decision was made to adjust the eligibility tests for businesses to receive the subsidy, at a cost of around $15 billion.

For businesses to receive the subsidy after September 28, they will now only need to show a fall in their September quarter earnings compared to a comparable period in 2019, instead of the previous requirement to show a fall in turnover in the June and September quarters.

For businesses to continue to claim the payment in 2021, they will again have to show the December quarter has experienced a drop in revenue compared to a comparable period in 2019.

The thresholds for falls in revenue will remain the same - for businesses with turnover of $1 billion or less they must show a 30 per cent drop, and businesses with turnover above $1 billion must show a 50 per cent drop. Charities will need to show a 15 per cent drop in turnover.

While the decision has been made based on the Victorian economy, the changes will apply nationwide.

The change will allow businesses who experienced better fortunes in the June quarter as the state's economy briefly opened up to remain eligible for the scheme.

Treasurer Josh Frydenberg said the introduction of stage four restrictions in Melbourne would have a severe economic impact on the Victorian and Australian economy.

"We also recognise that businesses have experienced employee turnover since JobKeeper was originally introduced," he said.

"To allow more employees to access the payment, we will now allow employees who were on the books from 1 July 2020 to access JobKeeper."

It's expected under the changes an extra 530,000 Victorians will receive the subsidy for the September quarter, and by the March quarter Victorians will make up 60 per cent of JobKeeper recipients.

National Cabinet meets on Friday for the first time in two weeks, in an environment that is significantly different from the last meeting.

The Victorian outbreak is top of the agenda, as is the federal government's response to the aged care sector in that state.

In a country where almost every interstate border is closed or severely restricted, discussions will also continue on a freight code to allow truck drivers to move across the country. Under the current system different states have different requirements for testing, a situation industry leaders say is slowing down transport.