The JobKeeper program has provided cash flow support to over 900,000 businesses and income support to some 3.5 million workers to date. But once the JobKeeper extension kicks in on 28 September, the number of eligible employees is expected to contract to 2.2 million.

This figure will be further reduced to about 1.75 million Australians in the March quarter, as the government moves to scale down the program ahead of its end in March.

The payment will also be tapered in the December and March quarters to encourage businesses to adjust to the new environment, supporting a gradual transition to economic recovery.

But despite these changes, and at a time when many businesses expect to be feeling the impacts of COVID-19, the government is confident that the extension will ensure those businesses that most need support continue to receive it.

“It’s always been a temporary program. It has always been a targeted program and it has always been scalable,” Treasurer Josh Frydenberg said on Tuesday. “What we have done is expanded and extended this program based on the circumstances that we find ourselves in. So, the extension of the program till the end of March, I think, is going to be a great relief to millions of Australian workers.

“As we know, economic conditions in Victoria right now are really tough. And it’s the Treasury’s estimate there will be more workers in Victoria who are on JobKeeper in the subsequent months than all those workers from other states combined who are on JobKeeper.”

The passage of the JobKeeper legislation on Tuesday will also see an extension to the workplace flexibility that has been available for businesses receiving JobKeeper payments. Similar flexibility will also be provided to legacy JobKeeper businesses where their turnover remains between 10 and 30 per cent down.

Speaking about these changes, Attorney-General Christian Porter said on Tuesday that they will save “many, many businesses and an enormous number of jobs”.

“All of those businesses that re-qualify for JobKeeper will get essentially those same flexibilities and then the flexibilities are preserved in a sensible, protected form for those businesses who come out of the JobKeeper scheme,” Mr Porter said.

“So, formally, if you’re a business and you were suffering a 70 per cent downturn in your turnover, now you’re starting to trade out but you’re still in a very difficult situation. You might be 20 per cent down in your turnover. You’ll be able to access those flexibilities and direct particularly with protections on hours.”

The JobKeeper payment will continue to remain open to new participants that meet the eligibility requirements.

The Treasurer has instructed eligible businesses to apply for the extended payment online via the Australian Taxation Office website. However, a legislative instrument detailing the rules for the new rates and the new eligibility criteria is yet to be released.