In the nick of time before the five-day lockdown in Victoria came into effect on Friday, the Premier Dan Andrews and Prime Minister Scott Morrison agreed to new support arrangements.
The Commonwealth chief medical officer Paul Kelly has declared parts of Victoria a hotspot for the purposes of allowing individuals to be eligible for Covid disaster payments of $600 for workers who lost more than 20 hours of work due to the lockdown.
Workers who lost between eight and 20 hours of work would be eligible for a payment of $375.
The shift in position came just hours after the Mr Morrison said he would take to national cabinet a set of arrangements under which individuals would not receive the support for lockdowns of seven days or less.
Defence Minister Peter Dutton said its showed the government was prepared to adapt and update as the virus evolves.
"As we are seeing in New South Wales and Victoria, the Delta variant is a very different variant and it is posing more problems and we are adapting to that," he told the Today show on Friday.
Federal Labor's deputy leader Richard Marles said the government was making it up as they went along.
"We are literally getting a new version of what is their support package every week," Mr Marles said.
The need for these new arrangements should have been foreseen at the time JobKeeper ended in March, he said, as the federal government had already budgeted for a lockdown in a major capital every month.
The federal government will provide income support for those who work or live in the areas declared as a hotspot by Professor Kelly. Those areas encompass Greater Melbourne, Moorabool Shire, City of Greater Geelong, Borough of Queenscliff and Surf Coast Shire.
Income support for individuals outside those areas can be provided where requested but with Victoria footing the bill.
There will be no liquid assets test applied to eligibility for these payments.
The payments will be made seven days after the commencement of the lockdown, even if the lockdown has already ended at that point.
Should the Victorian lockdown be extended, the arrangement will be switched to one of ongoing support, with fortnightly payments after the first week.
Mutual obligation requirements for job seekers in Victoria has also been suspended, Employment Minister Stuart Robert announced on Friday.
The new arrangements for shorter lockdowns will also be made available to other states and territories subject to Professor Kelly agreeing to declare areas Commonwealth hotspots, Mr Morrison confirmed in a statement late on Thursday night.
However, the state or territory must agree to provide significant economic support for the same lockdown period to ensure the cost is shared equally between the federal and state or territory governments.
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The federal government has not extended these arrangements to Canberrans who lose work because of ACT stay at home orders resulting from the Victorian lockdown.
Anyone arriving in the ACT from Victoria after 11.59pm on Thursday must declare their travel with ACT Health, and can only leave their premises for essential reasons.
Those reasons include shopping for essentials such as groceries, essential work or study which can't be done remotely, for medical care, to get a COVID-19 vaccine or for exercise one hour per day.