Flexible Budgeting: JobKeeper Changes.

6 minutes
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Discover how flexible budgeting can help businesses to adapt to JobKeeper changes and improve their resilience.

Three ideas to boost your business's financial resilience, if your business is no longer eligible for the JobKeeper payment.

  • Understand the purpose of your business and plan accordingly.
  • Consider whether your business should pivot.
  • Improve financial literacy and manage costs.

The JobKeeper payment has supported many businesses and the not-for-profit organisations significantly affected by COVID-19, to help keep more Australians in jobs.  Flexible budgeting, where budget adjusts or flexes with changes in activity, provides organisations with the ability to adapt as there are changes to the JobKeeper payment.

The government has announced extensions to the JobKeeper Payment. There are two separate extension periods.

  • extension 1: from 28 September 2020 to 3 January 2021
  • extension 2: from 4 January 2021 to 28 March 2021

From 28 September businesses will be required to demonstrate that they’ve suffered an ongoing significant decline in turnover using actual GST turnover (rather than projected GST turnover) by:

  • 50% for an aggregated turnover of $1 billion or more
  • 30% for an aggregated turnover of $1 billion or less
  • 15% for ACNC-registered charities other than universities and schools.

The following JobKeeper payment rates apply:


Extension period

eligible employees who worked for 80 hours or more in the four weeks of pay periods before either 1 March 2020 or 1 July 2020.

eligible business participants who were actively engaged in the business for 80 hours or more in the February and provided a declaration to that effect

any other eligible employee and eligible business participant

1: 28 September 2020 to

3 January 2021

$1,200 per fortnight before tax

$1,200 per fortnight before tax

$750 per fortnight before tax

2: 4 January 2020 to

28 March 2021

$1,000 per fortnight before tax

$1,000 per fortnight before tax

$650 per fortnight before tax

Source (ATO’s JobKeeper extension)

There will be some businesses that were previously eligible for JobKeeper that will no longer be eligible for JobKeeper. In this article we explore, what businesses, particularly those that are no longer eligible for JobKeeper, can do to respond and adapt to the COVID-19 crisis, so that they can continue to serve their customers in the future.

1.     Understand the purpose of your business and plan accordingly.

Ask yourself these two questions:

  • Does your business vision statement still hold true and maintain relevance for your key stakeholders – customers, employees and partners?
  • Will customers have the same demand for your services or has their focus shifted to more immediate concerns that you could help them with?

Perhaps some services your business offers may be more in demand than others, or some customers may have changed the way they access or consume your services. Be responsive and have a plan in place to meet changing customer needs.

Next, show your employees, you have a plan for how your business will work through various eventualities, such as changes to cash flow or disruptions to operations. This may help ensure they’re ready to deal with whatever comes next.

It’s important that you have an action plan in place. We encourage you to speak to experts in your network, to help formulate ways to maintain your business without JobKeeper, that is relevant to your circumstances, industry and business life stage.

We’ve created a handy guide with tips and tools to help your business adapt to the changing environment. Using this guide, you can learn practical ways to manage employees and customers, stabilise revenue, maintain your cashflow, and plan for the future.

2.     Consider whether your business should pivot.

It’s inspiring to know that some of Australia’s businesses have found ways to thrive and help add value to their customers, by pivoting. Take the example of Sydney and Brisbane-based social enterprise Jigsaw that creates jobs and training opportunities for people with a disability. When COVID-19 first hit they acted quickly, moving their training programs online. This has allowed them to expand their support services with people now able to access their training programs nationwide. Such pivots, large or small, should emerge from a clear understanding of what is working and what is not. 

To ensure your business pivots in the right direction, consider utilising data and insights as a guide to help decide whether it’s the right time to pivot (or to pivot at all). The data may come from google search data, your existing customer relationship management system, be derived from customers surveys or from talking to your customers. To make informed and effective decisions, the right insights then need to be readily accessible, interpretable, and actionable at the point of need – a situation enabled by technology and a culture of making data easily available. As part of this process, businesses should consider what products, technologies, processes, and services are currently being offered and take what they are best at into markets where that facet is lacking.  What’s also important is to have an open mindset to new opportunities as they present themselves

A strategic pivot is all about turning toward opportunities that your organisation can be positioned to address. It’s important to think about what problems or pain points customers are facing that you or others aren’t yet addressing and how best, with the resources available, might your organisation reimagine current services and add to them to bring greater value to the end customer.

As a starting point, try going through this Innovation Toolkit, which includes guidance on gathering customer insights using customer profiles, stories and journey mapping.

3. Improve financial literacy and manage costs.

Business owners today find themselves in a volatile, uncertain, complex, and ambiguous world. Here, financial literacy is key to increasing financial capability and resilience – something the Davidson Institute champions. It is important to have the type of budget that will allow you to anticipate the impact of unexpected change. With A flexible budget you can adjust your budget in line with the actual activity levels of your organisation.

Small businesses, by changing the way they operate, have taken steps to address gaps in their business cash flow – demonstrating their resilience and enabling them to remain financially confident.

There are eight key considerations for businesses looking to improve cash flow, cost management, profitability and business resilience during the pandemic:

  • Understand your current financial position: Armed with that knowledge, you’re better able to make information led decisions about your operations.
  • Manage capital expenses: If you can pivot your business strategy or create a future competitive advantage, you could use this time to accelerate capital investment in new equipment. Otherwise, it may be worth considering delaying any investments in capital equipment until the current situation improves.
  • Reduce your overhead costs: Consider if your costs can be structured differently or whether more costs can be variable.
  • Manage your stock and inventory: Consider if your expenses can be structured differently or whether more costs can be variable.
  • Manage your creditors: Consider contacting your creditors, including your suppliers and landlord, and asking for paying extensions.
  • Manage your debtors: If your debtors, including tenants, are experiencing cash flow difficulties themselves, consider negotiating periodic payments.
  • Adapt your business strategy: Look at options to adapt your business strategy to ensure business continues and customer demand is met.
  • Consider your finance options: Think about contacting your bank for help with your business financing.

With COVID-19 impacting the income of many businesses, we’ve put together a handy checklist of cash flow and cost management strategies that could help ease the strain on your business.  Having an awareness of your fixed and variable expenses may help you find lower cost alternatives and improve the financial position of your business. You should consider seeking specific professional relevant for your business.

Visit Westpac's small business relief hub for more information on how Westpac may be able to help your small business during the COVID-19 pandemic.

This article was updated on 22/12/20

This information is general in nature and has been prepared without taking your objectives, needs and overall financial situation into account. For this reason, you should consider the appropriateness for the information to your own circumstances and, if necessary, seek appropriate professional advice. ©Westpac Banking Corporation ABN 33 007 457 141 AFSL and Australian credit licence 233714.


author thumbnail image

Lali Wiratunga

Lali Wiratunga believes in encouraging positive financial behaviours to boost people’s financial confidence. He also advocates for the role of innovation, creativity and entrepreneurship in helping people and organisations deliver social impact and financial sustainability. In 2016, Lali was recognised for creating a positive impact through Pro Bono Australia’s Impact 25. Following a career as a corporate lawyer and management consultant in the UK, he's had 14 years experience in roles across financial services in Australia. He has served in the community as a Board member of a disability services organisation, and is a member of the Alumni Advisory Board at UNSW Business School, where he mentors students and advocates for the value of business education.

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