Prime Minister Scott Morrison has told restaurants that open their doors to sit-down diners this weekend they are "backing their country" and commended their "bravery".
"Good on you for reopening, and I'm sure your patrons will come and support you strongly," Mr Morrison said.
He acknowledged allowing just 10 diners at a time "won't necessarily be a profitable patronage for them".
But he congratulated them, as the federal government is keen to get the economy moving again in the face of dire economic data and the huge costs of the stimulus package.
"They're backing themselves, they're backing their staff, they're backing their communities and they're backing their country. And I want to commend them for that brave step that they're taking this weekend," he said.
He was speaking a day after data showed 2.7 million Australians have lost their jobs, or had their hours reduced since the March shutdown.
But chief medical officer Brendan Murphy continued to urge caution.
"As people start to go back to some normal activities ... please, please be careful," he said.
With hospitals well under capacity, the national cabinet also decided that all elective surgery can re-start, with decisions on timing made by each state and territory. On April 27, a number of elective surgery procedures were allowed, and now a three-stage resumption of "normal surgical activity" has been set up.
The first stage sees up to half of normal activity resume, then 75 per cent, and by stage 3 all normal surgery can resume, "or as close to normal activity levels as is safely possible".
ACT Health Minister Rachel Stephen-Smith said the territory should return to full capacity within the next few weeks.
Professor Murphy said he had briefed the national cabinet on Friday about the serious inflammatory syndrome and Kawasaki disease affecting children with coronavirus overseas.
He told the leaders the virus was so rare it was unlikely to be seen in Australia at all, given the low number of infections in children here.
"It's still not clear what the association with the virus is for this condition, but it is extremely rare," he said.
Professor Murphy said the national cabinet had also discussed the quarantine period for returned travellers and made it clear that no amount of testing changed the need for a two-week quarantine. A negative test did not mean someone was not incubating the virus, he said.
"There's been a bit of misinformation around about that, but you can't test your way out of quarantine," he said.
The national cabinet agreed to a three-part plan to tackle suicide risk and mental health issues: funding real-time data so it can track emerging problems, money to reach into indigenous, elderly and non-English speaking communities, as well as people with mental-health conditions, and a $10 million campaign to tell Australians "it's OK not to be OK".
Health Minister Greg Hunt said Queensland, Victoria and Tasmania had reported no increase in suicide rates to date, which he said was heartening.
"We watch very carefully, however, because these things can build up. They can brew. People can dwell. And so we want to get ahead of the curve," he said.
Chief executive of the National Mental Health Commission Christine Morgan said the plan stressed the need to tackle the "risky behaviour, that so many of us are engaging in to try and cope with the pandemic ''.
"We need to address those health issues ... associated with substance use and substance abuse, gambling," she said. "We must, and we will, deal with the issues around violence, domestic, family, sexual violence."
The government is reviewing its JobKeeper wage subsidy, through which 6.1 million workers have their wages subsidised by $1500 a fortnight. Another 1.6 million Australians are on the dole, now doubled and called JobSeeker.
Despite concern about some casual workers and others missed out on the wage subsidy, Mr Morrison continued to insist it wouldn't be expanded. The government hasn't promised, though, that it will stay in place for six months, as originally announced and legislated.
Mr Morison said he expected changes to the scheme after the Treasury review by June 30.
"I'm sure they'll identify other issues which will be addressed at that time," he said. But with the scheme only seven weeks old, it would be "very speculative to be considering anything other than the time frame that has been set out", he said.
The free childcare scheme finishes at the end of June, and Mr Morrison said its future was being reviewed. But it had been only temporary with plans always to return to the former funding system.
"It is not a sustainable model for how the childcare sector should work, and nor was it intended to be. At this point, no final decisions have been made on those issues. But the intention was always to return to the payment arrangements and subsidy arrangements."