News Financial Planning

Jobseeker Changes – Reduction Incoming…

COVID-19 has created unprecedented challenges for Australians. For many, their business’ have been barely able to survive, others have lost employment entirely. As a result, the Australian government instituted specialized support payments – Jobseeker and Jobkeeper. In effect since late March, these support payments will now begin to taper off. With a plan to cease them entirely after Christmas. From 25 September, the criteria for these payments have been tightened and amounts reduced. Phasing out of the Jobkeeper and Jobseeker changes signal a potential economic collapse. In addition, significant financial distress for millions of Australians already struggling. 

JobKeeper and Jobseeker Changes 

Beginning September 25, the JobSeeker maximum fortnightly rate for a single household will drop from $1110 to $810, while JobKeeper is set to be reduced to a maximum of $600 a week from September 28. 

What Are The New Conditions?

To continue to receive support, you must ensure you meet the updated criteria and submit all required information in the period requested.

jobseeker reduce

JobKeeper Changes

  • Show that your actual GST turnover has declined in the September 2020 quarter relative to a comparable period.
  • Have satisfied the original decline in turnover test
  • Pay your eligible employees at least the JobKeeper amount that applies to them each JobKeeper fortnight. 
  • Keep up to date with reporting employee numbers and who is receiving what payments based on the tiered payment system. 

The Australian Treasury offers key updates and requirement details for Jobkeeper payments. 

JobSeeker Changes

  • Taper rates shifted, from September 25th an updated income test will apply. Stipulating a loss of 60 cents for every dollar of income earned above $300 per fortnight. This will apply for recipients of both JobSeeker and Youth Allowance.
  • A minimum of 8 jobs per fortnight will need to be applied for, compared with the previous 4 per fortnight. 
  • Assets tests for JobSeeker will be reintroduced and will apply to new and current recipients of the payment. These had been paused.
  • Your partner’s income will be taken into account. You will lose 27 cents for every dollar they earn above $1165 per fortnight.  
changes to jobseeker

Short Term Solution

Australia’s unemployment at its highest rate this century. Asia-Pacific economist Callam Pickering noted that the official unemployment rate is 9.1 percent, having improved considerably from 11.6 percent in May. However as Ernst & Youngs’ chief economist, Jo Masters has pointed out, that number would be higher still if not for JobKeeper. As within these statistics, there were still 165,000 people counted as employed but working zero hours. In fact, the incentive to work was reduced significantly with the doubling of the jobseeker payment. Some employers reporting challenges in sourcing workers.

With over 70 billion already meted out in support payments in the past six months, its a model that cannot be sustained longer term. Meaning our unemployment levels are set to rise, high level unemployment goes hand in hand with economic collapse. 

The second phase of subsidy payments will continue until December 2020, at which time more reductions are anticipated. 

What This Means For Australia’s Economy

For the past six months, Australian businesses and individuals have been receiving support payments. Keeping them either employed in businesses that would have otherwise already folded, or paying living expenses while they searched for work. 

The expectation is now that a significant number of businesses will now inevitably close, pushing unemployment even higher. This also places millions of Australians in financial difficulty. Pair this with the end of ‘mortgage’ holidays and moratoriums on repayments of loans and credit cards and it signals disaster. 

While a cut in government spending seems like a smart decision in the long-term, it is estimated it will cost our economy close to 31 billion. Cutting the Jobseeker and Jobkeeper will further reduce our GDP and employment. 

With less household spending possible, consumption of goods decreases, further impacting our economic recovery. Analysis by Deloitte Access Economics has determined this reduction in spending will lead to the loss of a further 145,000 full-time jobs over the next two years.

jobseeker change

Found Yourself In Financial Difficulty?

Are the jobseeker changes or shifts in jobkeeper eligibility going to cause you financial hardship? You should speak to the experts at The Australian Lending Centre. We can support you to refinance, take out short term loans, enter debt management agreements, and more. 

Don’t lose sleep wondering about the next steps and fearing your finances. Our expert staff can help you assess your situation and come up with solutions. Our goal is to help you manage this challenging period and find a path forward. Managing your debts may be the key to surviving the extended challenges we face economically due to COVID-19. 


Australian Economy 2020

If there is one thing on everyone’s mind at the moment in the midst of the global pandemic, it’s the health and safety of the entire nation. Coming in a close second is the state of the Australian Economy 2020. The economy took a huge hit as we saw many businesses forced to close while we were sent into lockdown in March, resulting in close to one million Australians finding themselves unemployed and even more with significantly reduced work hours. As we slowly rebuild our lives post lockdown, the fear of a second lockdown is ever imminent, and currently underway in Melbourne. What affect will this have on the Australian economy, and what can we expect to see in the coming months?

How Has The Australian Economy Being Impacted in 2020

While we all rung in the New Year with high hopes of what was to come, we woke up to the news of the South Coast fires that tore through entire communities. Up until February, these out of control fires ravaged Australia, crippling communities and impacting the economy, with many tourists cancelling trips. Just as things started to improve, a global pandemic was set to send Australia into another spin. By the end of March, non-essential businesses were forced to close, leaving many Australians out of work as we entered into lockdown for six weeks. While we have reopened again, it is far from over, with many businesses struggling to make ends meet. So where does this leave the Australian economy in 2020?

economy 2020

Helping the Australian Economy 2020

Treasurer Josh Frydenberg has spoken out and revealed exactly what this pandemic has cost our country. An Australian economy 2020 update shows our budget deficit will hit the $184 billion mark this financial year, which is the biggest blow out since World War II. As the economy took a major hit, the Australian Government stepped up with a number of support packages to keep businesses afloat and help the economy as much as possible. These include the JobKeeper and Jobseeker programs that have become lifelines for businesses and individuals alike. However, these programs are set to end in October this year, threatening to create the fiscal cliff.

What Is The Fiscal Cliff?

When the funding is cut off towards the end of this year, many Australian people and businesses are going to feel the hit. This will then result in a big hole in economic activity, as people tighten their belt buckles, instead of spending money to help the economy. On 22 July, the Government announced an extension of the JobKeeper program until March, under new conditions and with smaller amounts of cash available. While this has helped to lessen the expected fiscal drop, it won’t prevent it.

australian economy

The New JobKeeper

So what exactly has changed under the new JobKeeper payments and what impact will this have on the Australian economy in 2020? Right now, $1500 is being paid fortnight to eligible Australians, with more than $30 billion paid out to date. From September 28, two-tier payments are beginning based on pre-COVID hours. This is $1200 a fortnight for workers on 20 or more hours and $750 a fortnight for those on less than 20 hours. From January 4, this top-tier payment will be reduced to $1000 and second-tier reduced to $650.

Looking At Australia’s Unemployment Rate

Between March and May, 870,000 jobs were lost, while more than one million Australia had their working hours reduced. The unemployment rate is now up at 7.4 percent and is expected to rise before the year is out. The Government has spent unprecedented amounts of money already, and The Grattan Institute has estimated it would cost $70 to $90 billion a year over the next two years to get that figure back to under 5 percent. It’s no secret that the impact of the Coronavirus is far-reaching, and we are still yet to find ourselves out of the woods. Melbourne has recently re-entered a second lockdown amid an escalating number of cases across their city, while Sydney is under the threat of another lockdown with numbers increasing daily. Another hit to the economy could escalate these huge figures even further, with the debt and deficit rising.

What Next?

If you have found yourself in a position of being unable to make ends meet, then it is worth considering taking out a loan to help tide you over. At Australian Lending Centre, we can find the right loan for your personal needs to get you back on track and ensure you stay afloat amidst the looming global pandemic. Right now, getting back into the workforce is a difficult feat. Even with Government payments, it can be hard to get by. A loan is a great way to tide you over in these times. Speak to one of our experts today.

First Home Buyer News

Land of the “Fair Go” Now a “No Go”

Income Inequality in Australia

Australia has always been a country that has been considered egalitarian by the rest of the world, a place where all citizens had a ‘Fair Go’ at the Australian Dream, – that is, until recently. Australia has suffered a shift in income equality that has created a sizeable gap between the rich and the poor.  “In Australia, the richest 1% are as rich as the poorest 60% of Australians,” with wages for top earners increasing at a more rapid rate than the wages of the everyday Aussie.

A big factor in this troubling trend is that Australians’ assets are skewed toward real assets as opposed to wage earnings in determining their net worth. With median home prices on the rise throughout Australia it is no wonder that we are witnessing a steadily decreasing middle class.

A large difference in net worth can be seen through generational gaps. Baby Boomers came into the market in a time when Australian home prices were lower. They bought properties and were easily able to pay them off with a single income setting them up for greater earning potential and financial security in their future. Generation Y on the other hand, hasn’t had such luck.  They are typically known as the generation who has been shut out of the property market with rising prices of real estate.

Australian home prices in 2016 are high when compared directly with the average Australian income. In January 2016 the Australian average weekly wages were measured at $1160.90 by the Australian Bureau of Statistics which is considerably out of proportion with the rising cost of real estate. Sydney currently has the highest mean house price in the nation with the average home price as high as $780,900 AUD, pricing many younger buyers out of the market completely resulting in a drop in first time home ownership.

Generation Y, on the other hand, earn significantly more than Generation X , but they have significantly less investments, relying heavily on their income as a source of wealth.  This has given them a significantly lower net worth; the effect of this is made more severe by the lack of wage growth in the past years. Wage growth was down by as much as 3% in 2015. With little hope of that big raise, the hard-working Generation Y Australian won’t have much opportunity to increase their wealth and will have a tough time competing with an older generation with growing investment returns.

Millennials are also being generationally affected by these factors. Many young Australians are opting to move back in with mom & dad after university to combat rising home prices and cost of living. For many it’s the only way to save enough for a down payment.

So what does this mean for Australians? The average Australian is going to have less disposable income than they had 8 years ago.  That means less money for consumer spending. Inequality and the growth of class differences could potentially have a big effect on the way the economy grows and negatively affect our communities.


News Tax Debt Loans & Relief

Federal Budget 2015 – The Good and The Bad

The Australian federal budget changes announced on May 12th had many positive points as well as several negative points that you might have missed if you did not pay close attention and read the details.

Federal Budget 2015

The Bad

On the negative side, the federal budget axed large portions of the money devoted to combating climate change. Abbott’s government has reduced the funding to the Green Army, a group of tree planters that formed part of Abbott’s “Direct Action” policy aimed at reversing climate change.

The taxes collected from “indirect taxation” will really open your eyes when the figures are laid out clearly. GST alone is expected to bring in $54.285 billion while taxes on alcohol will bring in another $5.23 billion along with petrol’s $6 billion and tobacco’s tax revenue of $8.28 billion. Australia’s foreign aid has also been slashed 20%, down to $4.1billion.

African nations in need along with neighboring Indonesia will have their benefits cut the most. Special tax breaks for big families have been taken away to save the government $177.3 million. Some art programs will have their budgets cut entirely or trimmed significantly. FIFO workers will have some travel benefits slashed to close loopholes for those who were taking advantage of the generous tax concessions.

The Good

On the positive side of things, the government is taking the initiative to allow employee share schemes so that employers can attract vital staff with tax incentives on start-up company shares. The Abbott government is making it easier for Australia’s young people to access The Youth Allowance payments.

Small businesses will get a big boost by being able to write off $20,000 of their taxes for every piece of equipment they buy for their business. Shift workers will also get more family help from nannies through a $246 million subsidy.

There were some big changes made to the federal budget in the recent announcement and not all of the news was only positive or negative but together gives a picture as to which way the government is looking to spend or save the tax revenue it receives. Whether or not you agree with the new government’s new changes to the federal budget, it is important to know how it could possibly affect you and your business or family. No matter what side of the politics you are on, it will be interesting to see how these changes to the federal budget will affect the Australian economy.

Interest Rates

Australian Economy is Growing – Interest Rate Impact

The Australian economy grew 1.2% in the second quarter of fiscal year 2011. That growth exceeded expectations of a 1% economic expansion. This surprised numerous economic analysts and market observers, who mostly predicted a slower growth in the period. According to some experts, the economic boost could be attributed to stronger performance of several sectors aside from mining, which for quite some time has been solely driving growth of national economy.

Investors look at this news as an additional positive development. A better performing Australian economy could translate to better profitability. Most company shares in the market have been rising following the announcement of the better-than-expected economic growth. The local currency is also gaining strength against the dollar, which is ideal for many businesses, especially those that require importation of raw materials. But what is the impact of this news to consumers, particularly to the interest rates?