Dr HAINES (Indi) (17:35): Like many of my colleagues in this place, I love to spend non-sitting weeks on the streets of my electorate, speaking with small businesses and having in-depth conversations with constituents. Back in August, when I drove my ‘conversation caravan’ down to Mansfield, a small town on the edge of the Victorian Alps in the south of my electorate, the message was clear from the main street small businesses, local tourism operators and local financial advisers. All of the people I spoke with told me that JobKeeper was a critical lifeline. There was a mood of restrained pessimism. JobKeeper had saved countless businesses from financial ruin and kept employees with no immediate alternatives with pay in their pocket and a connection to their employer.

Fast forward to last week when I drove that same conversation caravan down to Murrindindi shire and the townships of Alexandra, Yea and Marysville on the fringe the Yarra Valley just outside Melbourne. I spoke with many businesses and community organisations, from Helico Australia and the Grant Street newsagency in Alexandra to the Lake Mountain reception centre and the Marysville and Triangle Community Foundation. It was clear to me that community views have pivoted dramatically since August. For the first time in months I felt a spirit of optimism and energy to get business engines running again and employees back on the books. Quite a number of businesses had already stopped using JobKeeper, and many were keen to do so soon. Some were also concerned that the blunt incentives that JobKeeper is built upon had been open to exploitation, and some told me about market distortion as a result of JobKeeper. All of that might have been a forgivable consequence when we needed to get money out the door asap at the peak of the crisis, but we need to be more diligent now.

It’s also important to note that it’s not optimism all around. I’ve heard from many travel agents, event businesses, catering services and the like that JobKeeper is still a critical lifeline to them. These businesses aren’t ready for any kind of bounce back soon, not least the end of March, and to do so for them would be a disaster. We must also not forget local artists and dedicated academics and administrative staff at our regional universities—all our universities—who were nonsensically locked out of JobKeeper and remain in insecure positions.

What does this tell us? We have to apply common sense when it comes to tapering JobKeeper. First, we need to be there for the businesses ready to jump back in again. They’re brave, and we should acknowledge and support their courage and enthusiasm. We should offer these businesses a staged process to make sure they’re best positioned to hit the ground running. It also means we should be there if the unexpected happens again, like the snap lockdown in Victoria. This road is not a straight one. Second, we cannot abandon those who are still in economic peril—wedding businesses, casual academics, local painters and freelance graphic designers. The list goes on. These businesses and contractors are still hurting. If the government were not able to be there for them last year, they have a higher duty for them to show up now. Third, we need to get other macroeconomic settings right.

While RBA Governor Philip Lowe was optimistic in his statements earlier this month, they were very cautious and based on some long-bow assumptions. The cash rate remains at 10 basis points. We’ve just seen another $100 billion out the door in government debt. Wage growth is stuck at the bottom of the barrel, and all prudent economic modelling suggests no significant improvements until 2024 at the very earliest. Sure, you cannot run the Australian economy on tax dollars forever, but that does not mean you can abandon fairness and equity. For example, permanently raising JobSeeker to give those who have few savings the chance to income-smooth and bounce back is smart, value focused economics, not state dependency.

The same goes for how we taper JobKeeper. This should not be about turning the tap off overnight. It’s also not about picking winners and losers sector by sector. It’s about being rational, considered and specific about how we wean off JobKeeper so that the economy at large is best positioned to recover and thrive again.

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