Australian prime minister to ask global leaders to fund urgent research for coronavirus vaccine

Katharine Murphy, Ben Butler and Paul Karp
Photograph: Mike Bowers/The Guardian

Scott Morrison will urge G20 leaders to fund rapid research to develop a coronavirus vaccine and support trials of anti-viral drugs, while keeping borders open to ensure critical medical supplies can be traded during the crisis.

With 80 countries seeking assistance from the International Monetary Fund to manage the economic shock triggered by the pandemic, and with G20 finance ministers predicting a global economic downturn, Australia’s prime minister will use a teleconference of world leaders scheduled for late Thursday night to call on rich countries to support the developing world to help lower the death count in countries with poor health systems, and also minimise the risk of failed states.

Morrison will say Australia intends to assist the Pacific as much as possible during the pandemic.

The G20 hookup comes as the Morrison government is working up a third round of safety net measures on the assumption that swathes of the economy will move into a period of suspended animation as lockdowns take effect. Conceptually, the government wants to ensure that businesses emerge on the other side of the pandemic without substantial liabilities on their books that would force them to either declare bankruptcy or sack substantial numbers of workers.

Morrison will also meet the premiers on Friday at the national cabinet. New South Wales, Victoria and the ACT have signalled they will move to stage 3 lockdowns over the coming days in an effort to contain community transmission, and Friday’s meeting will consider specific trigger points for that decision.

Related: Coronavirus: NSW and Victoria set to tighten lockdowns as PM says all states can pursue own plans

With the number of reported coronavirus cases in Australia creeping towards 3,000, governments are keeping a close watch on the number of infections that are locally acquired with no known link to a confirmed case. Official data seen by Guardian Australia indicates there were 115 cases in that category on Thursday, with a further 432 cases under investigation.

As of Thursday night, it appeared unlikely that stage 3 lockdowns would be imposed in the most populous states before the weekend, and the Morrison government wants to stretch the time before that happens as long as possible. Data collected by the government through the Citymapper app points to a substantial drop off in movement around cities since the government closed the border, and restrictions on crowds were imposed in mid-March.

As well as establishing the trigger points for the next sequence of lockdowns, Friday’s meeting will also consider as yet uncompleted work on financial assistance measures for renters and landlords. The nuts and bolts of that package are being worked up by treasurers, with the states responsible for residential tenancies and the commonwealth dealing with commercial landlords and renters.

The states are looking to ensure that residential tenants don’t get evicted over the coming months if they cannot pay their rent and will propose options to ensure there are no rent increases during the crisis.

The Morrison government wants the states to offer land tax relief for landlords, but is unlikely to get the states on board. The commonwealth is considering tax relief for landlords prepared to either cut rent or provide rent holidays for their tenants.

The treasurer, Josh Frydenberg, is also prevailing on the banks to help carry the load of suspended rental income for the duration of the crisis. The insurance industry has also been in talks with the Morrison government over the rent package.

It is believed insurers are concerned they may be on the hook for hundreds of millions of dollars in payments under landlord insurance policies. The insurance covers landlords for a variety of problems, including non-payment of rent. It is believed most policies do not exclude non-payment caused by a pandemic.

“The insurance industry is aware of discussions around the impact of Covid-19 on commercial and domestic rents and is talking to government about the issue,” an Insurance Council of Australia spokesman said.

Also on the agenda for Friday’s national cabinet meeting is a conversation about reducing the amount of elective dental surgery to free up protective equipment. There will also be another conversation about schools in an effort to land on a national position.

Morrison held talks with education unions this week and is attempting to broker arrangements where schools around the country move to provide distance learning by term two but campuses remain open for students who need to attend because their parents are essential services workers, or because they are in disadvantaged households.

With the economy already profoundly disrupted by the pandemic, business and unions are attempting to recalibrate industrial arrangements. On Thursday, two peak employer groups struck a deal with the Australian Services Union to vary the clerks award in a bid to keep hundreds of thousands in work by improving flexibility.

Related: It's not working: Scott Morrison's late-night coronavirus messages only sow confusion | Katharine Murphy

The deal, struck with the Australian Industry Group and Australian Chamber of Commerce and Industry, allows employees and employers to change the ordinary hours of work to better allow working from home. It also gives more power for employers to direct employees to take annual leave and more options for longer periods of leave at reduced pay to manage the downturn.

Pressure from peak business groups to adopt some form of wage subsidy to keep workers in employment on top of grants of up to $25,000 continued to grow on Thursday.

The Council of Small Business Organisations Australia chief executive, Peter Strong, told Guardian Australia it wanted a 60% wage subsidy, which together with existing grants worth 20% of employers’ wages bill would deliver income support equivalent to the 80% adopted in the United Kingdom. The measure, which would cost $21bn for three months assuming 1.7m Australians are displaced from their jobs, was one proposal put to treasury officials at a meeting on Wednesday.

The government is examining wage subsidies for the third round of stimulus but is reluctant to adopt income support that gives more assistance to higher income earners than workers on average incomes or minimum wages. It also wants to deliver support through the existing tax and transfer system.

The finance minister, Mathias Cormann, said the government had not adopted a wage guarantee because “the advice in front of us was that that was not the best way in an Australian context” to provide support, because “the existing jobseeker payment framework” – unemployment benefits – would reach households faster.

The government is yet to respond to Labor’s call to change the income threshold and taper rates for unemployment benefits so more families are able to access jobseeker payments where one partner is jobless but the other earns more than $48,000.

Options are still being developed by the social services minister, Anne Ruston, and the government characterises an agreement between the prime minister and the Labor leader, Anthony Albanese, as a commitment only to consider changes with a view to expanding eligibility.