‘Going to get worse’: Treasury estimates coronavirus will wipe $50 billion off economy

The economic effect of the coronavirus will be felt the most by June, the Treasury boss warns.

The economic effect of the coronavirus will be felt the most by June, the Treasury boss warns. Photo: The New Daily

Australia’s coronavirus shutdown will result in the loss of $4 billion a week from the economy, Treasurer Josh Frydenberg is set to reveal.

It comes as the government eyes ways to ease the current restrictions amid promising signs we’ve flattened the curve.

In a move to demonstrate why businesses should reopen sooner, Mr Frydenberg will reveal Treasury figures which show Australia’s economy will shrink by between 10 and 12 per cent by June – equivalent to $50 billion – due to shutdowns.

And a harsher lockdown, such as those seen across Europe, could wipe $120 billion from GDP.

That’s why Mr Frydenberg will on Tuesday urge for Australians to get back to work quickly.

Extracts of his speech, which he will give at the National Press Club, show he will also note that the jobless rate is expected to double to 10 per cent by June.

Australia is still fortunate in that it hasn’t resorted to a full lockdown but the economy is set to get worse before it gets better, he will say.

The economic hit is due to the combination of unemployment, productivity loss and a drop in consumption.


Agriculture, mining and construction have been able to adapt to the new health restrictions and in most cases continue to operate.’’
- Extract from the Treasurer's speech

Mr Frydenberg will say: “Notwithstanding Australia’s success to date on the health front, and the unprecedented scale and scope of our economic response, our economic indicators are going to get considerably worse in the period ahead before they get better.”

Relaxing restrictions

National cabinet will on Friday decide whether to relax some anti-coronavirus measures across the country.

In the meantime, the National COVID-19 Coordination Commission will provide a high-level briefing on virus-safe workplaces with hopes of enabling millions of Australians who are working from home to return to the office.

Federal Industry Minister Karen Andrews has been working across a range of sectors to prepare plans for a safe return to work.

But she is taking “baby steps” to ensure “we are back on track as quickly and as effectively and as safely as we can”, she told reporters.

New Zealand Prime Minister Jacinda Ardern will join the national cabinet meeting to discuss the creation of a trans-Tasman travel bubble.

Death toll increase

A 15th resident of a Sydney aged care home has died after testing positive to coronavirus, taking the NSW total to 45 and the national toll to 96.

Ann Fahey, pictured centre, had initially tested negative for coronavirus but her condition rapidly deteriorated.

It came after Newmarch House on Sunday confirmed the 14th person, Ann Fahey, died in hospital after contracting COVID-19 at the home.

The latest nursing home death has brought more questions about the outbreak at Newmarch House in Caddens, operated by Anglicare.

A daily testing regime has been established for staff at the nursing home to manage what is Australia’s second deadliest outbreak after the cruise ship Ruby Princess.

Twenty-six staff and 37 of the 100-odd residents have tested positive for the virus since April 11.

Ruby Princess

Home Affairs department head Michael Pezzullo is preparing to front a Senate committee on Tuesday afternoon to answer questions about the Ruby Princess debacle that has led to hundreds of coronavirus cases across Australia.

ruby princess probe

NSW Police raided the Ruby Princess on April 9. Photo: NSW Police

Mr Pezzullo will be joined by Border Force officials and the agriculture and environment departments for the third round of the Special Commission of Inquiry.

Five new witnesses will testify on Tuesday to help uncover the grave missteps of the ill-fated cruise ship that has been linked to more than 20 coronavirus deaths and 600 infections across Australia.

Last repatriated Australians finish quarantine 

The last of the repatriated Australians to complete their mandatory 14-day isolation in an Adelaide hotel will be able to head home.

On their final night, the 308 quarantined guests were treated to a three-course dinner and live entertainment by a local DJ before they check out of the Playford Hotel on Tuesday morning.

The Australians arrived in Adelaide on the second mercy flight from India via Mumbai a fortnight ago.

-with AAP

Stay informed, daily
A FREE subscription to The New Daily arrives every morning and evening.
The New Daily is a trusted source of national news and information and is provided free for all Australians. Read our editorial charter
Copyright © 2024 The New Daily.
All rights reserved.