The federal government has announced its $17.6 billion coronavirus stimulus package. Here are the six key elements.
- Scott Morrison announced the details of the federal government’s $17.6 billion coronavirus stimulus package on Thursday.
- The government outlined six key elements to the plan – with a focus on support for business.
- Here’s what the government will be handing out.
Despite the urgings of the opposition, economists and the Reserve Bank, the Morrison government before now has steadfastly refused to do much to stimulate a lagging economy.
Now, as the looming threat of the coronavirus – which the World Health Organisation just deemed a pandemic – rattles markets and threatens to expose fundamental weaknesses in the Australian economy, the tone has shifted dramatically. The much-vaunted surplus, repeatedly promised for the better part of a decade, has been forgotten for now.
On Thursday, Prime Minister Scott Morrison and Treasurer Josh Frydenberg finally announced the details of the government’s $17.6 billion stimulus package, intended to blunt the effects of an economic downturn led first by the bushfires and then by the coronavirus pandemic.
Morrison said the gross impact of the “significant investment” on the Australian economy would be $22.9 billion over three years.
The big beneficiary of what was announced on Thursday is business, on the assumption this will support job creation. “This plan is about keeping Australians in jobs,” Morrison said. “This plan is about keeping businesses in business.”
“Three out of a four dollars will go to backing business in supporting Australian jobs,” Frydenberg added.
Morrison took great pains to repeat these measures will “not extend past the 30th of June next year”.
Here are the six key elements of the government’s plan:
- An increase in the instant asset write-off scheme. The threshold jumps from $30,000 to $150,000.
- A 50% accelerated depreciation deduction. This is over and above existing deductions.
- Payments of up to $25,000 for businesses with a turnover of up to $50 million. This is intended to support cash flow for employers.
- A 50% wage subsidy for apprentices. This will be $1.3 billion in support payments to keep almost 120,000 apprentices employed.
- A one-off stimulus payment of $750 for people receiving benefit payments. This includes pensioners and those on Newstart, the disability support pension, carers’ allowance, youth allowance, veterans support payments and family tax benefits.
- A regional and community support fund. This will support businesses and communities who Morrison said would be particularly affected by an economic downturn.