The federal government will begin phasing out financial support for those whose income has been affected by COVID-19 in a bid to stamp out state lockdowns.

Under the COVID-19 Disaster Payment, recipients have received $750 per week if they lost over 20 hours of work, $450 per week if they lost between eight and 20 hours, and $200 per week for those on income support payments who lost over eight hours of work.

The payment has helped keep millions of Australians on their feet since it was announced in June this year.

In a recent interview with Travel Weekly, Tom Manwaring, chair of the Australian Federation of Travel Agents, said the lockdown payments have been a lifeline for travel businesses, many of which haven’t been able to operate for 20 months.

“We have to wait until the money begins to flow back into the system before we shut any support off,” Manwaring said.

“The lockdowns in NSW and Victoria are dreadful, but that is the only way we in the travel industry have received payroll support.

“We want people out of lockdown, we want them free to go to the restaurants, the pubs, and everywhere else.

“But as soon as that happens, travel businesses are going to need to find another way to keep staff on.”

On Wednesday, Treasurer Josh Frydenberg said the payments would begin to wind back once each state and territory achieves a 70 per cent fully vaccinated population (16 years and older) in line with Phase B of the National Cabinet’s plan.

Once a state or territory reaches the 70 per cent target, the automatic renewal of the payment will end and individuals will have to reapply each week that a Commonwealth hotspot remains in place to confirm their eligibility.

When a state’s population reaches 80 per cent full vaccination, where a Commonwealth hotspot remains in place the payment will be cut off within two weeks. After that, those who still need financial support will need to apply for JobSeeker.

Frydenberg said the move would back Australia’s reopening plan.

“Those business support payments have helped businesses keep their doors open and also to keep their staff on the books, while our COVID disaster payment has made up for those hours of work that has been lost,” he told 2GB.

“We’ve put more than $13 billion out the door just in response to the Delta variant and alone, and we can’t keep doing that with taxpayers money forever.

“These are emergency payments, and they’ll need to come to an end.”

However, Shadow Social Services Minister Linda Burney said it is too soon to be ending the payments.

“When a state or territory gets to 80 per cent vaccination, businesses are still not fully functioning and people’s jobs are still not reappearing,” she told ABC News.

“It’s just going to leave people without support and it’s going to throw them into absolute dire situations.”

A spate of additional financial support packages the government contributes to will also be wound down as each state hits the fully vaccinated targets.

In NSW, the minimum and maximum weekly payments for employing businesses will be reduced by 25 per cent to $1,125 and $75,000 weekly, and grants to be 30 per cent of weekly payroll.  The grant for sole traders will reduce to $750.

A $2.27 billion package that supports Victorian businesses most affected by restrictions will also be wound back as the state reaches the fully-vaccinated thresholds.

Around 124,000 eligible Victorian businesses will continue to receive automatic Business Costs Assistance Program grants ranging from $1,000 to $8,400 per week, rising according to payroll, until the end of October.

Businesses that remain closed or severely restricted over the first two weeks of November will also receive automatic payments for that period.

In the ACT, the recently-expanded grants for tourism, accommodation, events and hospitality will also wind up once the territory reaches the 80 per cent target.

On the flip side, last weekend the Frydenberg announced $70 million in joint federal and state grants to boost support for Queensland’s major tourism and hospitality businesses who continue to do it tough.

Under the agreed package, $30 million from the state and federal governments’ $600 million support package will be targeted at supporting Queensland’s tourism attractions, and $40 million will be used to provide a second round of grants to small, medium and large tourism and hospitality businesses across the state that received an initial grant from the Tourism and Hospitality Sector Hardship Program.

The government will leave the Pandemic Leave Disaster Payment in place until 30 June 2022.

Featured image source: Facebook/JoshFrydenbergMP