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Severe recession, huge debts: Australia's Covid-19 strategy

By Brendan O'Reilly - posted Thursday, 16 July 2020

Australia started out with a stated policy of merely attempting to "flatten the curve" of new Covid-19infections, so that our medical facilities could cope with the inevitable spread of the virus. We achieved this ­– mostly by closing our borders, and by using targeted quarantine, social distancing, and strategic testing. The shutdown also helped, but was less important.

By May this year, our politicians were congratulating themselves about the rapidly slowing rate of new cases. The PM and most state premiers also benefitted from a lift in the polls. The public, however, was told "that doesn't mean we can we can lift restrictions just yet. We need to continue the current measures and see sustained flattening".

In response to Australia's success in limiting the spread of Covid-19, the official strategy then seemed to morph into (an unstated) bolder one of eliminating the virus altogether, which is what New Zealand seeks to achieve. [Stephen Duckett of the Grattan Institute, and some others openly advocated such a policy, though no government in this country explicitly did.] The Australian National Cabinet met with New Zealand PM, Jacinda Ardern, in May to consider a trans-Tasman "travel bubble" as part of limited efforts to reopen Australia's borders.


These plans now have fallen in a heap.

Just a week after New Zealanders celebrated "having rid the country of Covid-19" and the NZ government lifted all restrictions except controls on entering, the virus came back to bite them. Health officials were forced to admit that two women, who had arrived from the UK on 6 June and left managed quarantine on 13 June, were later found to be infected. They had not been tested for the virus. On 7 July two new cases were found among returning travellers. In all there are now (11 July) 25 known active cases of Covid-19 in New Zealand, all in managed isolation or quarantine.

Meantime, metropolitan Melbourne went into a stage three lockdown for six weeks after the state recorded 191 new cases of Covid-19 in one day. At the time of writing (after six successive days of over 100 new cases) this record was surpassed with more than 288 new cases on 10 July. The six-week Melbourne lockdown may cost $1 billion a week. [Given that the standard quarantine for the virus is 14 days, it is not clear why six weeks is necessary.]

The latest breakout in Victoria and smaller outbreaks in NSW suggest that the complete elimination strategy is not viable. Moreover, the policy of isolating Australia from international travel is high risk because it is reliant on the rapid development of an effective vaccine. Qantas CEO, Alan Joyce, said that the airline is unlikely to resume international flights until July 2021, and that "it is expected to take three years for international travel to return to 2019 levels".

There are a number of hard facts that are being largely ignored by our governments.

Firstly, there is no guarantee that an effective Covid-19 vaccine will be developed.


Corona viruses (first identified in the mid-1960s) are a common group of viruses in both humans and animals. They usually cause mild-to-moderate respiratory illnesses, and are the cause of about 20 per cent of common colds. There are at least seven corona viruses that can infect people. The best known are Covid-19, SARS-CoV (the one that causes severe acute respiratory syndrome, or SARS), and MERS-CoV (Middle East Respiratory Syndrome).

To date scientists have never made a successful vaccine for a corona virus (including for SARS). According to Professor Ian Frazer from the University of Queensland, it probably won't happen soon because Covid-19 is posing challenges that scientists haven't dealt with before. Currently, only two companies, Moderna and Sinovac, are in stage-two trials. Human trials for a COVID-19 vaccine being developed by the University of Queensland are just starting. Five other companies are in stage-one trials, while scores of others are in a preclinical phase.

Experience with (easier to develop) flu vaccines is also cautionary.

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About the Author

Brendan O’Reilly is a retired commonwealth public servant with a background in economics and accounting. He is currently pursuing private business interests.

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