Australia's federal govt to cut Covid-19 income support

Australia's federal government will wind down emergency funding for people who lost work during Covid-19 shutdowns as vaccination rates increase across the country, putting pressure on state and territory leaders to keep their economies open.The decision to cut off federal support when inoculation levels reach 80 per cent means individual states and territories would have to foot the bill if they decide to go into lockdown in response to any fresh outbreaks of the corona virus.

"(This) emergency payment needs to come to an end," Frydenberg told Seven News today. "If you look around the world ... people are starting to get about their normal lives, learning to live with the virus in a Covid-safe way."Australia's two biggest cities, Sydney and Melbourne, along with its capital Canberra, have been in lockdown for several weeks as the country grapples with a Delta variant-fuelled third wave of the virus.

The shutdowns have put Australia's A$2 trillion (US$1.5 trillion) economy on the brink of a second recession in as many years.In other virus-free parts of the country, state and territory leaders, who have the power to close their borders under Australia's federal system of government, have done just that, hoping to avoid importing infections from the hotspots.The federal government, which has spent more than A$9 billion (US$6.5 billion) since June to support around 2 million people, wants all internal borders reopened when the 80 per cent vaccination threshold is reached nationally, expected in November.

However, despite the creation of a national cabinet to form a cohesive response to the pandemic, some state leaders have indicated they may not follow that national plan.Frydenberg said federal income support payments will begin to be phased out when a state reaches 70 per cent vaccination. At that level, affected workers must reapply each week to confirm their eligibility. Payments will stop two weeks after the 80 per cent target is met.