Tasmania’s economic position has already changed in the two weeks since the state provided its August Economic and Fiscal Update, Department of Treasury and Finance says.
Appearing before a hearing of the Public Accounts Committee’s inquiry into the COVID-19 response, department secretary Tony Ferrall said the full economic impact of the pandemic would not be known until it was over.
He said the Economic and Fiscal Update handed down on August 14 had provided a general update based on assumptions and available information.
“Even since we’ve done that there’s been quite significant changes, for example the Victorian pandemic situation,” Mr Ferrall said.
“We’ve seen the significant risk to the state’s economic and budget position continue and that will change as new and different information becomes available in the coming months.”
Mr Ferrall also told the committee the scaling down of the JobSeeker and JobKeeper payments would have a significant impact.
He said the number of people on JobSeeker in February 2020 was 12,900 which increased by 26,600 people to 39,500 in July.
This was an increase from 2.9 per cent of the working age population to 8.9 per cent, the committee heard.
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Premier-Treasurer Peter Gutwein said he expected the future of JobSeeker and JobKeeper would be clarified in the Commonwealth’s budget which will be handed down in October.
“In terms of the interests of all Premiers, we’d like to see payments brought up as high as possible for as long as possible,” Mr Gutwein said.
“We would hope that there would be a strong correlation between any step down in JobSeeker and JobKeeper with an economy starting to improve.”
Mr Gutwein said it would interesting to see how many businesses would be coming off JobKeeper if they could not demonstrate a 30 per cent loss in revenue.
“On one hand that’s a good thing because it means their turnover is increasing but for someone with a 29 per cent decrease in turnover, that will be a bitter pill,” he said.
“We won’t have any data until that step is taken and firms notify and engage with the Commonwealth in terms of their turnover.”
The committee also heard COVID-19 had impacted the timing of capital works projects.
“There is a high degree of uncertainty around the timing of infrastructure expenditure,” Mr Ferrall said.
“There are impacts on supply chains which impact on the advance of some projects.”
Mr Gutwein said although cranes in the Hobart sky may be gone he would like to see more utes in the suburbs delivering housing.
“In the commercial space, it will be harder to get projects up but in terms of housing, that’s an area we can continue,” he said.
Speaking after the hearing, Labor finance spokesman David O’Byrne said it was clear that the Tasmanian economy was holding on by a thread.
He said the government needed to more actively advocate for the extension of JobSeeker and JobKeeper.
“We are heading towards a cliff,” he said.