The cost of the JobKeeper wage subsidy will increase by more than $15 billion due to the hammer blow to business caused by the Victorian coronavirus crisis.
The $15.6 billion JobKeeper blowout, which will take the total cost of the scheme to $102.2 billion this financial year, is due to two factors.
First, more businesses, predominantly in Victoria, will have to access the existing scheme between now and the end of September because of the shutdown of the state’s economy. This will cost an extra $4.5 billion and will result in 530,000 more Victorians receiving the subsidy in the September quarter.
Secondly, at a cost of $11.1 billion, the government has softened the eligibility criteria for the new JobKeeper 2.0 scheme, due to begin in late September, because there will be many businesses which recovered in the June quarter but collapsed again because of Victoria’s second wave lockdown and will now need ongoing support.
How hard was that? Print a few more bonds, sell ’em to the RBA.
Deficits are irrelevant. Go for virus elimination.
Monetise the virus!