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PM walks middle path on post-virus support

Prime Minister Scott Morrison has warned against creating a dependency on coronavirus support measures as economists urge the government to continue welfare schemes.

The Grattan Institute has recommended the government spend between $70 billion and $90 billion on extra economic stimulus measures.

The International Monetary Fund is calling for a gradual exit from support programs, with public investment to accelerate the recovery.

Mr Morrison says economists vary across the spending spectrum.

“They want us to spend nothing and they want us to spend everything – the truth is going to be somewhere in the middle,” he said on Thursday.

He said the government would not let dependence on support stop businesses, and the federal budget, from bouncing back.

“That will cost jobs and livelihoods,” Mr Morrison said.

“The other thing is, we have been incredibly careful not to lock in government spending into the decades into the future. That’s how you swamp the Australian taxpayer unfairly.”

Lockdowns have been reimposed across 10 Melbourne postcodes on Thursday as the city recorded 77 new cases.

Across the rest of the country, there were eight new cases in NSW and one in the Northern Territory – its first since early April and linked to one of the Melbourne hotspots.

New infections in Victoria have been in double digits for more than two weeks, with authorities scrambling to contain the disease.

Deloitte Access Economics partner Chris Richardson said the longer outbreaks like the one in Melbourne last, the more would need to be spent.

“Recovery is government or nothing,” he told AAP.

He said it was important unemployment benefits were higher than the pre-coronavirus level of $40 a day.

“Because it’s all changing so fast, we will have more people dropping through more cracks.”

Mr Morrison is confident Australia’s economy will become independently strong again, fuelling job growth.

“The future of the Australian economy is not to remain in ICU,” he said.

“In the meantime, the government will continue to do what is necessary to support us to get to that stage.”

Meanwhile, health officials have urged those Melbourne residents now back in lockdown to remember what helped them cope the first time around.

“Many people finding themselves back in lockdown today will be feeling anxious and fearful, many may be angry and frustrated and many may be feeling somewhat despondent,” Deputy Chief Medical Officer Michael Kidd said.

“Nobody should feel that they are on their own at this time.”

He’s also concerned by an uptick in the number of people hospitalised from the disease.

There are now 24 people in hospital with five in intensive care – up from 18 hospitalised and three in ICUs on Wednesday.

“This is a stark reminder of the very serious impact that COVID-19 can have,” Profesor Kidd said.

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