Workers who lose hours because of lockdowns will receive up to $750 a week under a boosted federal support scheme.
Coronavirus disaster payments for people who lose more than 20 hours will be increased from $600, with the new rate mirroring the original JobKeeper wage subsidy.
Workers who lose between eight and 20 hours will be eligible for $450, up from $375, while welfare recipients will no longer be excluded.
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People on Centrelink payments will be eligible for $200 a week if they lose more than eight hours of work.
Prime Minister Scott Morrison announced the increased support after a four-week lockdown extension for Sydney and surrounds was confirmed.
He argued disaster payments were faster, more effective and better targeted than JobKeeper.
"We are not dealing with a pandemic outbreak across the whole country," the prime minister told reporters in Canberra on Wednesday.
"JobKeeper was a great scheme but you don't play last year's grand final this year."
While the expansion is designed to immediately help people in NSW, all Australians will be eligible for the new rates under future lockdowns.
The scheme has dished out $411.7 million to people in NSW and about $80 million to Victorian residents in recent months.
NSW recorded 177 new local infections on Wednesday, with Premier Gladys Berejiklian confirming a lockdown extension until at least the end of next month.
A raft of federal-state business support was unveiled for NSW and Victoria which are grappling with pandemic-induced financial pain.
In NSW, eligible businesses and not-for-profits with revenue declines of more than 30 per cent will receive payments of between $1500 and $100,000 a week.
The expanded program's turnover cap has been increased from $50 million to $250 million.
With a two-week lockdown easing in Victoria, the governments agreed on $400 million in business support.
That includes support for sectors under strain from capacity limits, small businesses, a fund for hospitality and help for commercial landlords with tenants under rent stress.
While a record 196,982 coronavirus vaccine doses were administered in the past 24 hours, the national rollout continues to lag behind the developed world.
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Just 17 per cent of people aged 16 and over have been fully vaccinated five months into the program.
But the prime minister is bullish that everyone will be offered a jab by the end of the year.
"I would expect by Christmas that we would be seeing a very different Australia to what we are seeing now," he said.
Mr Morrison has previously warned countries like the UK with high vaccination rates continue to record soaring daily case numbers.
But he now says highly immunised nations have more options to fight the disease.
"Lockdowns become a thing of the past when you are at that level," the prime minister said.
One new local infection was detected in Queensland along with 19 cases on a ship offshore.
South Australia's snap shutdown has ended after a Delta outbreak was contained.
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