Coronavirus Australia: Scott Morrison to meet bank chiefs as economic cliff looms | Australia news

Scott Morrison has said Australia’s economic response to Covid-19 will enter a “another phase” in September, with industrial relations flexibility to be rolled over to support part-time jobs and talks with the big banks about extending loan repayment holidays.

Morrison made the comments on Friday after national cabinet, which decided to ease physical distancing requirements for small venues and continue the 14-day hotel quarantine for returned travellers with a new requirement to be tested for coronavirus on the way in and out.

Under the new rules, states and territories can allow venues of 100 people or fewer to use a two-square-metre rule instead of four, in line with Tasmania and Western Australia’s eased restrictions.

After the meeting, the Tasmanian premier, Peter Gutwein, announced plans to reopen its borders from 24 July, although it will reassess in a fortnight given the localised clusters of coronavirus in Melbourne, which resulted in 30 new cases overnight.

Morrison said that, despite the outbreak, the national cabinet “remained firm on sticking with their three-step plan and continuing the easing of restrictions” with more announcements expected from state premiers in coming days.

Although Morrison said all states were likely to reopen their borders by July, except Western Australia, he added that he expected states might exclude residents from localised hotspots as part of a “tailored response”.

Morrison revealed he and the treasurer, Josh Frydenberg, will meet the chief executives of the major banks on Friday to discuss “the issue of deferral of loans” and find out what they propose to do when mortgage and small business loan deferrals expire in September.

He said talks were needed to address the “very real issues” of a cliff of economic support, arguing that both banks and the government needed to ensure “smooth transitions” because some parts of the economy were struggling more than others.

Morrison appeared to rule out trimming back the $70bn jobkeeper wage subsidy scheme by requiring businesses to requalify every month – at least until September.

He said imposing the revenue downturn test each and every month “would be a change to the scheme” and he had “said consistently the scheme will run as it was intended to until the end of September”.

The government will receive a Treasury review into jobkeeper by the end of June, with a response to come in late July along with an updated economic statement with further support for sectors still struggling including tourism and aviation.

“We will continue to tailor our fiscal supports to those areas that will continue to need them,” he said, citing income support as one such payment that was “really important”.

Morrison also cited industrial relations flexibility as another Covid-19 policy that must continue after September.

Changes to awards made by the Fair Work Commission and legislation as restrictions were imposed in March had allowed employers to “keep people in jobs and share hours”, he said.

If “rigid rules” around full-time and part-time employment were reimposed “those on part-time hours would be most at risk”.

“I fear that that could lead to part-time employment being lost unnecessarily and we know that and particularly women … would be affected.”

The news conference was the last with Brendan Murphy in the post of chief medical officer, before he moves to position of health department secretary.

Murphy praised Victoria’s response to the localised outbreak through contract tracing more than 1,000 people and “testing extraordinary numbers of people”, and said that rates of 20 to 30 new cases a day is “what you’d expect”.

Murphy said authorities would “start testing people on entry to quarantine and testing people before they leave quarantine to see whether a testing regime might help in the future”.

The 14-day quarantine will remain for the time being because the risk from returned travellers “is still very high” with the risk profile of each country “changing all the time”.

Morrison said it was up to states and territories whether this testing would be compulsory.

Murphy said the rate of 30% of people in hotel quarantine in Victoria refusing tests was “quite a high rate” and noted states had powers to refuse to release people until they agree.

“I think most people when they understand it, particularly, we will … make sure people understand before they come that this is a requirement,” he said. “I think most people will cooperate with that arrangement.”

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