CCBR Business Review

18 B U S I N E S S T I P S CONTINUED FROM PAGE 17 By David Evers, Managing Director of AdviceCo matic process is advised. You may wish to offer a payment plan in this case too. The ACCC has introduced new boundaries and rules in relation to debt collection during COVID-19. If you are struggling to secure payment, always check your options with your account- ant and build a measured plan. Troy Marchant is a Chartered Accountant and cash flow specialist. To talk to Troy about debtor management, email Debtor Management during COVID-19 Re-cap: The national economy and JobKeeper IN JULY, THE Federal Government pro- vided an update on our national economic position, and separately announced some changes to its COVID-19 support schemes for business. It’s safe to say that the preservation of jobs is the economic survival and recovery strategy. The news is, and will continue to be, sobering for business owners who are staring in the face of prolonged economic strain. We share the below summary not to cast further shadow, but to encourage a realis- tic perspective, awareness of the support options available, and strength to define and achieve your own business success within our new environment. An economic summary (see Table A): • The government stimulus has so far totalled $289 billion or the equivalent of 14.6 per cent of GDP. • The government has, and will, forego taxes in the form of discounts of $31.7 billion in 201920 and $63.9 billion in 202021. • The underlying cash balance is forecast to decrease from balance in 2018-19 to a $85.8 billion deficit in 2019-20 and a $184.5 billion deficit in 2020-21. • Within the global context, all three major credit ratings agencies having now reaf- firmed Australia’s AAA credit rating dur- ing the pandemic. • Our national net debt is expected to be $488.2 bil- lion (24.6 per cent of GDP) at 30 June 2020 and increase to $677.1 billion (35.7 per cent of GDP) at 30 June 2021. • As a result of the pandemic around 709,000 jobs were lost across the country in the June quarter. • The unemployment rate is forecast to peak at around 9¼ per cent in the December quarter although labour market conditions are expected to strengthen beyond 2020. • Further temporary and targeted stimu- lus measures will include: - Extended JobKeeper scheme to March 2021 - JobTrainer Fund and Support for Apprentices and Trainees wage subsi- dies - COVID-19 specific health, hospital and pharmaceutical funding. This is a moment in history. Businesses are being tested for their agility, their abil- ity to source and retain their ideal internal and outsourced specialist teams, and their defense strategies. But as history suggests, it is absolutely possible to come back (see Table B). JobKeeper is extended: The JobKeeper Payment is now extended beyond the original date of 27 September 2020 to 28 March 2021, and has some changed business eligibility terms. Changes to the payment 1. For the October-December Quarter there will be a 2-tier entitlement: i. $1200 per fortnight for employees on 20+ hours per week Pre-COVID-19 ii. $750 per fortnight for employees on less than 20 hours Pre-COVID-19 2. For the January-March Quarter there will be reduced 2-tier entitlement i. $1000 per fortnight for employees on 20+ hours per week Pre-COVID-19 ii. $650 per fortnight for employees on less than 20 hours Pre-COVID-19 Changes to eligibility Turnover tests will be reapplied for each quarter: • For December Quarter, the turnover needs to have dropped in both the June and September quarters. • For the March quarter turnover needs to have dropped in each of the June / September / December Quarters. The current structure of $1,500 per fort- night per employee for businesses expe- riencing a 30% downturn (15% for Non- profits, 50% for businesses with a turnover of more than $1 billion) will continue until 27 September. The Prime Minister described the need for the changes to target businesses and workers under sustained pressure due to COVID-19 and to wean businesses off gov- ernment support. With this new information, businesses must plan their financial and cashflow position for each upcoming quarter. For more information or support with JobKeeper, contact us on mail@advice- or 02 4320 0500, or visit our website: Table A Table B CENTRAL COAST BUSINESS REVIEW AUGUST 2020