FIVE FACTS FROM THE COVID-19 ECONOMIC SUPPORTS: LESSONS FOR FUTURE

The Five Facts from the COVID-19 Economic Supports: Lessons for Future Economic Downturns report, authored by Rose Khattar and Gianni La Cava, provides a detailed analysis of the effectiveness of various financial support measures implemented by the Australian government during the COVID-19 pandemic. This submission to the Commonwealth Government COVID-19 Response Inquiry highlights five key findings: (1) one-off and semi-permanent boosts to income support programs significantly increased recipient spending; (2) the overall impact on economic activity depended on the size and distribution of payments; (3) targeted income supports led to increased spending on essentials; (4) not all financial support measures improved self-reported well-being; and (5) job protection schemes, such as JobKeeper, limited job mobility, which in turn affected productivity and wage growth. The report emphasizes the importance of targeted fiscal responses in future economic downturns, advocating for a clear framework based on empirical evidence from past interventions. It also discusses the potential long-term impacts of increased public debt and the design of policies like early access to superannuation, which may not have achieved their intended effects on well-being or financial resilience. The findings underscore the need for future policies to focus on boosting income support for those most vulnerable while also facilitating job mobility to enhance productivity during economic recoveries.