The federal government will soon withdraw its contribution to the JobSaver payments once New South Wales reaches its 80% full vaccination rate for residents above 16 years old.

Meanwhile, the state government plans to continue funding the program until the end of November. The continuation of JobSaver until 30 November “will give businesses across NSW the financial boost they need to get them through the challenge of re-opening their doors,” said a statement from the NSW Government website.


Key points

  • JobSaver is a jointly funded business support package by the federal and NSW governments that follows a 50-50 cost-sharing arrangement.
  • JobSaver will taper from 40% to 30% of weekly payroll — at a minimum of $2,250 per fortnight — at 70% full vaccination.
  • The federal government will end its 50% contribution as soon as NSW reaches the 80% double-vaccination rate.
  • Meanwhile, the NSW government will continue paying eligible businesses with the remaining 50% until 30 November 2021.
  • At 80% double-vaccination, the JobSaver payments will be reduced from 30% to 15% of weekly payroll, at a minimum of $1,125 per fortnight.
  • The micro-business grant (for non-employing businesses) will reduce to $1,500 per fortnight (at 70% double-vaccination) before reducing to $750 per fortnight (at 80% double-vaccination).
  • To continue receiving your payments from the period 27 September to 10 October 2021 and onwards, make sure to reconfirm your eligibility every fortnight. Here’s how.


By maintaining the NSW government’s contribution to JobSaver, “businesses can still receive the support they need as the state moves from response to recovery,” the former premier Gladys Berejiklian said last week.

The two-month extension of JobSaver is expected to help businesses in overcoming the challenges they might face in the re-opening. However, for cash-strapped businesses that rely on government support to stay afloat, this limited support may not be enough.

The events industry, in particular, expressed their concerns about the withdrawal of government support. Unlike the retail industry, they explained that they need a significant lead time before they can start doing business. Diversifying is also difficult due to the nature of their operations.

Although they understand that payments will eventually stop, they call for continued “industry-based assistance” to help businesses and sole traders that can’t easily snap right back into the game.


How Can Your Business Deal with It?

Once the NSW government achieves its vaccination targets, businesses can start operating at a limited capacity. However, it isn’t enough to guarantee an immediate recovery. There may still be limitations over the coming period, and this may translate into limited profits in the short term. Businesses should be prepared for this.

If you’re thinking about the possible ways to bounce back from the pandemic without government assistance, we recommend this two-step approach:


1. Prepare a cash flow forecast

Perform a cash flow forecast to estimate how cash will come in and out of your business over a specified period. 

For example, if you’re expecting JobSaver payments until the end of November, how long can it help your business stay afloat? How long do you think will it take before your business can earn a decent revenue to cover your expenses, including your rent, employee salaries, and other fixed costs?

Next, determine your variable costs and figure out how you can reduce them. By doing so, you have more chances of spreading out your available resources for longer.

Other ways to manage your cash flow when business is slow include being proactive in collecting receivables and understanding your margins, which will help with your planning.


2. Assess your break-even point

Your break-even point is where your total expenses are equal to your total revenue. Meaning, you have incurred no loss or gain — you simply recover your business costs.

To evaluate your break-even point, you must understand your revenue, gross profit, and other costs.


Get Financial Help

Our accountants at ABJ Solutions can help you manage your cash flow during these difficult times. For more information about our finance and accounting services, get in touch with us. You can also take our free financial health check by clicking here.

Interested to read more content to improve the way you manage your business? Click here to visit ABJ Solutions’ blogs.