Thousands of Australians were queueing at Centrelink offices around the country on Monday as businesses prepared to shut down, and after the federal government doubled unemployment benefits to deal with the economic fallout from the coronavirus.

Huge lines were snaking around blocks in many locations, but as Services Australia directed people to begin their claims for welfare payments online, the MyGov website was down for many users after nearly 100,000 people tried to access it just after 9am.

Amid Centrelink queues not experienced in Australia in decades and consisting of many people who were engaging with the welfare system for the first time, the government announced new measures aimed at streamlining the application process for people newly out of work.

The queues began to form early on Monday, before some Centrelink offices had opened, after state governments announced that businesses including pubs, bars and clubs would be forced to close. On Sunday the government said it would provide a $550 fortnightly boost to the JobSeeker Payment for six months, essentially doubling the benefit.

“There’s nothing out there at the moment and all the jobs I was halfway through applying for have gotten back and said there’s a freeze,” Adam Edwards, from Redfern, in inner Sydney, told Guardian Australia.

Edwards, who graduated with an MBA only two weeks ago, said all the jobs he had been in the process of applying for had disappeared over the past few weeks.

Lines at Redfern Centrelink still stretching around the corner. People coming out tell me that it’s chaotic inside. Lot of very distressed people. It’s also starting to rain. pic.twitter.com/hJ3U6tk25p — Michael McGowan (@mmcgowan) March 23, 2020

In the line at the Centrelink office in Redfern, casual workers hit by the shuttering of pubs and clubs mixed with small business owners and recent graduates all caught up in the chaos wrought on the global economy by the Covid-19 outbreak.

Gus McGrath, 24, is a musician and hospitality worker, who moved to Sydney from Canberra a month ago and had been supplementing his income by playing gigs while he looked for full-time work.

“I guess I feel like it’s not getting better any quicker. I don’t see an easy out,” he said.

“So I think I’m pretty freaked out and it feels a bit doomy and even when things settle back, it can’t just be like back to normal.”

In parliament house, the prime minister and opposition leader acknowledged the long lines outside Centrelink offices. But in Redfern, the mood was tense. Those coming out of the offices reported angry and chaotic scenes inside as staff tried to cope with the huge influx of people seeking to access services.

The line to Centrelink Bondi Junction. It wraps around almost every corner of the block. @9NewsSyd #COVID19Aus #centrelink pic.twitter.com/tyCsuxwb6R — Hannah Sinclair (@hansinclair9) March 22, 2020

Serena Lee is a small business owner whose ag-tech company has been put “into indefinite hibernation” in the midst of the outbreak. She had already had to let go 10 casual employees in Sydney and Melbourne, and was now lining up to apply for benefits herself.

“We do indoor vertical farming in corporate and school places so because no one is at work, no one is at uni, our business has pretty much had to go into hibernation,” she said.

“It’s overwhelming. I didn’t think I would need to get onto benefit payments until it sort of hit where it’s like, I might not have a job for the next at least a couple of months.

“I’ve got to pay rent and bills and I’m already at the bottom of the cash pot having to pay out employees. But, you know, everyone has situations that are probably worse than me.”

Centrelink Canberra. Never seen this before. Spare a thought for our fellow Aussies no matter the background. Starting to be reminiscent of my dad’s stories of queues in the Great Depression. Let’s stick together Australia. Let’s run this place as if everyone matters. #ForAllOfUs pic.twitter.com/IL8IW9E7Eq — Patrick O'Leary (@PadYeo) March 22, 2020

My friend works in film so there is no work at the moment. He is applying for Centrelink for the first time but getting a number has to be done in person. This is Burwood this morning. The public service is essential. #COVID19Aus pic.twitter.com/egUvCYQYqm — Cinzia Myatt (@cinziamyatt) March 22, 2020

Huge numbers of people are about to understand why @CPSUnion & many others have been fighting against staff cuts and privatisation of Centrelink.

Pls do not blame Centrelink workers for delays & problems.#auspol #coronavirusaus https://t.co/alxF2FPUL1 — Michael Tull (@Michtull) March 22, 2020

With Centrelink’s online services down, the government services minister, Stuart Robert, said that the MyGov website had suffered a distributed denial-of-service attack. He would not give any details.

He later told parliament that, in fact, the system had simply been overwhelmed when about 90,000 users tried to access the website concurrently just after 9am.

In a bid to clear the enormous lines at Centrelink offices, Robert also announced the government would once again pay jobseekers from the date they contacted the agency to start a benefits claim, reversing a savings measures passed in 2018.

And he said people claiming unemployment benefits for the first time could prove their identity over the phone, rather than in person at a Centrelink office.

This statement probably should have been posted BEFORE everyone started to line up at Centrelink #coronaaustralia pic.twitter.com/JeLtzaM0t0 — Sam Clench (@SamClench) March 23, 2020

Centrelink call centre operating hours would also be extended until 8pm on weekdays and 9am-5pm on weekends.

Labor’s government services spokesman, Bill Shorten, said the there had been a “lack of planning to deal with demand at Centrelink shopfronts”.

“Many families, workers and business owners who have never accessed social security before are being forced to by the financial effects of the coronavirus,” he said.

“People should not have to wait weeks to access these vital payments.”

Robert said the government had upgraded the MyGov website to cater for 10 times its usual traffic over the weekend. It can now deal with more than 55,000 concurrent users.

But for hours on Monday, it still could not cope.