$100 million in SA Govt grants for businesses shut during lockdown

Tens of thousands of South Australian businesses that have been forced to close over the lockdown are eligible for a $3000 emergency cash grant from the State Government, while workers stood down across regional and metropolitan SA will receive up to $600 a week in compensation.

Jul 21, 2021, updated Jul 21, 2021
A closed North Adelaide gym. Photo: Tony Lewis/InDaily

A closed North Adelaide gym. Photo: Tony Lewis/InDaily

Premier Steven Marshall told reporters this morning that the State Government would match the Federal Government’s lump-sum disaster payments, to ensure workers stood down in regional South Australia would receive the same amount of compensation as those in metropolitan Adelaide.

Under the state and federal government funding packages, workers across SA who lose between eight hours and 20 hours of work during the first week of lockdown will be eligible for a $375 back payment from next Wednesday.

Those who lose more than 20 hours will be eligible for $600 in income relief from next Wednesday.

It comes after Commonwealth chief medical officer Professor Paul Kelly yesterday afternoon declared all of metropolitan Adelaide, Gawler and the Adelaide Hills a COVID hotspot – triggering Federal Government COVID-19 lump-sum disaster payments for workers in those areas who are no longer able to earn an income.

But workers in regional areas outside hotspot locations are not eligible for federal funding, despite the lockdown restrictions extending across the state.

Premier Steven Marshall said the State Government would step in to compensate regional workers, given the lockdown is statewide.

“We do this because we know that this (coronavirus) can move very quickly and we do from a health perspective want to include country SA in a lockdown,” he said.

“It’s not fair for them if they don’t have that disaster income support, so that will be extended statewide.”

Marshall said he wanted the Federal Government to extend its hotspot declaration across all of SA, “even if the Federal Government has a different trigger for that”.

“We want it because we don’t want a situation where, for example, someone in Adelaide travels to the country, they’re not in lockdown and we set this new train of transmission off,” he said.

All compensation will be processed through Services Australia, regardless of whether the payments are funded by the state or federal governments.

Prime Minister Scott Morrison told FIVEaa this morning that the disaster payments are at the same level as JobKeeper was in the December quarter of last year.

“It’s a more targeted way of getting payments to people more quickly,” he said.

“And if … the lockdown goes into a longer period, then we have a national program which shares the program for business cashflow assistance as well.”

Cash grants for small to medium-sized SA businesses

Treasurer Rob Lucas at this morning’s press conference. Photo: Tony Lewis/InDaily

The State Government has also announced that it will provide cash grants of $3000 to small to medium-sized businesses that have been impacted by the lockdown.

The support package is worth about $100 million and is estimated to support 50,000 businesses across the state, to help employers cover the costs of rent, power bills, supplier and raw material costs, and other fees.

Cash grants of $1000 will be made available for sole traders.

Businesses are eligible for the payments if they have a payroll of less than $10 million, with an annual turnover of $75,000 or more in 2020-21 or 2019-20.

They must prove that their turnover will be reduced by at least 30 per cent over the seven-day lockdown from July 20.

They must also be located in South Australia, employ South Australians and have a valid Australian Business Number.

Larger businesses will not receive any funding support.

The funding package is based on similar schemes in Victoria, New South Wales and Western Australia.

Treasurer Rob Lucas said the money would come from the State Government’s contingency fund.

“What it does mean is a very large amount of money in our contingency budget will be expended on managing the costs, both health and also business costs, which means you have less capacity for other emergencies through the year,” he said.

“But, we sensibly planned in our budget contingency funding, which would mean that we’re able to meet the costs of the support packages and the increasing costs that heath will confront obviously in terms of both testing and vaccination.”

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Lucas said if the lockdown extended beyond seven days, the Government would consider providing further funding to support businesses.

He said the Government would also consider giving targeted support to industries that are significantly impacted by the lockdown.

The Government has broadened the eligibility criteria for businesses compared to last year’s lockdown funding package and it anticipates a “significantly larger” number of businesses will receive funding support.

“We’re much more generous this time round,” Lucas said.

“We were cautious with the taxpayer’s money last year, but we’ve seen that the states in other jurisdictions have broadened the eligibility criteria in relation to the sole traders.

“Our best guess estimate at this stage is that there might be potentially up to 50,000 businesses, so we’ve massively broadened the range of businesses that might be entitled to this particular grant.

“If you’re COVID-impacted, then you’re entitled to be eligible for the grant.”

Property Council SA executive director Daniel Gannon described the funding package as a “shot in the arm for small businesses across South Australia”.

“It was devastating to see ‘closed’ signs hanging in city and suburban windows earlier this week, with business uncertainty leading to great anxiety across the SME sector,” he said.

“While many businesses are facing big downturns in revenue, Federal and State Government stimulus packages are very much welcomed during these challenging times.”

Business SA has also welcomed the funding support, but chief executive Martin Haese warned the financial impact for many businesses would likely go beyond $100 million.

“Ultimately any support measure will be welcomed, but we note that nothing will entirely offset the losses incurred by a seven-day lockdown, other than to be open for trade,” he said.

“The ultimate form of support for businesses is for the lockdown to be lifted as soon as it is safe to do so and we acknowledge the Premier’s clear recognition of this need.”

Business SA estimates 57 per cent or 21,900 of its member businesses that employ staff are unable to operate normally over the lockdown.

It estimates 65 per cent or 67,600 of its non-employing member businesses have to close.

Meanwhile, welfare advocates have warned that over one million people on social security payments in South Australia, New South Wales and Victoria have been excluded from the Federal Government’s disaster payments, despite many losing part-time paid work.

They have called on the Federal Government to immediately extend the disaster payments to lift all incomes to $600 a week for people impacted by lockdowns in South Australia, Victoria and New South Wales.

“When emergencies strike it is almost always those who are most vulnerable who are hit hardest,” SA Council of Social Service CEO Ross Womersley said.

“We need to make extra sure that we have smart policies and government responses in place that don’t leave those people hanging.

“With South Australia now joining Victoria and NSW in lockdown, the numbers of people affected are growing even higher.”

– with AAP

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