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Coronavirus chaos: $17.6b Govt bailout, events cancelled

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Welfare recipients including Newstart recipients, pensioners and households accessing family tax benefits will be handed a one-off $750 stimulus payment as part of a $17.6 billion federal bid to ensure the coronavirus pandemic doesn’t “bury the budget for a decade”.

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Scott Morrison and his Treasurer Josh Frydenberg today detailed their highly-anticipated stimulus plan, which the Prime Minister told reporters was “designed to ensure we have a fiscal hangover” as a result of the coronavirus outbreak, which was overnight declared a pandemic by the World Health Organisation.

It comes as US President Donald Trump today decreed America would suspend all travel from Europe – except from the United Kingdom – for a month.

Also today, SA Premier Steven Marshall jetted to Sydney ahead of tomorrow’s COAG meeting, acknowledging “there will be more cases in SA” after health authorities last night confirmed two new positive coronavirus tests in the state – from two men who had travelled overseas.

They bring the state’s total to nine cases of the virus, with three of those affected having since recovered.

However, Marshall warned SA needed to maintain trade ties, particularly with the US, saying: “We’ve got to make sure we don’t just close up shop here in SA.”

“What we can do is be as prepared as we can be,” he said.

In Canberra, Morrison unveiled a response designed to “keep Australians in jobs, keep businesses in business and support households and the Australian economy as the world deals with the significant challenges posed by the spread of the coronavirus”.

“We can’t control the source of this problem, being the coronavirus, which has come from elsewhere, but we can control our response,” said Morrison, who will also make a rare televised address to the nation tonight, at 6.30pm SA-time.

The last time a Prime Minister made such an address was Kevin Rudd during the Global Financial Crisis.

“We’re going to do everything we can to ensure we’re best positioned to bounce back strongly on the other side,” the Prime Minister told reporters in Canberra today, saying the measures were “all temporary, targeted and proportionate to the challenge we face”.

“Our actions will ensure we respond to the immediate challenges we face and help Australia bounce back stronger on the other side, without undermining the structural integrity of the budget.”

The $17.6 billion plan includes $4.8 billion for the one-off automated, tax-free payment to more than 6.5 million pensioners, social security, veteran and other income support recipients and eligible concession card holders, with pensioners accounting for “around half of those that will benefit”.

Frydenberg also said deeming rates – used to calculate how much some pensioners are earning on their financial investments – will be cut by 50 basis points to reflect recent interest rate changes.

About 117,000 apprentices are expected to benefit through wage subsidies for employers with fewer than 20 employees, at a cost of $1.3 billion over two years.

The cash injection will subsidise apprentice wages for up to nine months, with the aim of keeping them in a job in challenging economic circumstances.

Casual workers will get immediate access to a sickness payment if they need to self-isolate.

The package also contained:

– a $1 billion fund to help communities hurt by flow-on effects of the coronavirus.

– about $6.7 billion over four years towards individual $25,000 tax-free payments for businesses turning over up to $50 million a year, which the Government hopes will benefit 700,000 businesses and 7.8 million workers

– from Friday to July 1, the instant asset write-off for businesses will be raised from $30,000 to $150,000, and expanded to businesses with an annual turnover of up to $500 million from $50 million previously, at a cost to the federal budget of $700 million – a move expected to help 3.5 million businesses.

There will be a $1 billion component for assistance to severely-affected regions, “including those heavily reliant on industries such as tourism, agriculture and education”.

This will include waiving fees and charges for tourism businesses operating in the Great Barrier Reef Marine Park and Commonwealth National Parks.

 

Finance Minister Mathias Cormann earlier confirmed this year’s budget won’t be in surplus.

Overnight, the World Health Organisation declared the global coronavirus crisis a pandemic, sounding the alarm about mounting infection rates and slow government responses to curtail its spread.

There have been more than 120 confirmed cases of coronavirus in Australia, although more than half of those people have been cleared. Three Australians have died.

Treasury has forecast the coronavirus will subtract 0.5 percentage points from economic growth numbers in the March quarter.

However, Frydenberg said the $11 billion to flow into the economy by mid-year would help boost GDP by 1.5 per cent.

Morrison said the gross impact of the stimulus in this financial year and the next two financial years would be $22.9 billion or 1.2 per cent of GDP.

COAG meets tomorrow to discuss the stimulus plans of the states and territories, which will be on top of the federal government’s plan.

Marshall today rejected state Opposition calls for his Government’s $350 million infrastructure spending stimulus to be redirected to households.

“We don’t have to capacity within our budget to do that but what we do have is the ability to bring forward a large number of projects,” he said.

“What we really need to do is make sure we’re as prepared as we possibly can be – we don’t want to see people losing their jobs as the world struggles with coronavirus.”

Marshall noted that “we have our budget coming up in June [and] if we need to take further action we will”.

“Both [federal and state] packages will work hand in glove to deliver for South Australians in what are clearly challenging economic times, with many local businesses, industry and individuals set to benefit from the targeted response,” Marshall said.

“My team will continue to work cooperatively with the Federal Government to ensure our communities don’t just weather this storm but emerge stronger as a result…

“We’ve already announced a massive program of upgrades to country hospitals [which] most importantly is going to keep tradies and other workers employed in country areas.”

Asked whether he had contemplated the cancellation of the Anzac Day parade, the Premier said he would “take the advice of public health experts”.

“I’d be very reluctant to see that happen,” he said, describing it as a “sacred and solemn” occasion.

However, a less solemn Adelaide event, the SA Midwinter Ball, has been indefinitely postponed, organisers revealed today on social media.

US indie veterans The Pixies today joined a long line of entertainers to shelve Australian tour plans.

The AFL, which has already forecast the prospect of playing matches in empty stadiums this year, continues to have its preparations for the looming season hampered, with clubs curtailing their launch events and Collingwood cancelling a planned open training session.

The Melbourne Football Club today revealed it had segregated its men’s, women’s and VFL sides “to protect its players and staff from the spread of COVID-19”.

Each team will train at separate locations, while administration staff “will remain at the MCG or work from home”.

SA fans have already been affected by last month’s cancellation of Port Adelaide’s Shanghai fixture in Round 11, with the match relocated to Melbourne.

In the US, the NBA took the unprecedented move of suspending its season at the conclusion of today’s games, after a player from the Utah Jazz “preliminarily tested positive for COVID-19.”

The basketball league said the test result was reported “shortly prior to the tip-off” of the game between the Oklahoma City Thunder and the Utah Jazz in Oklahoma City, leading to the match’s cancellation.

“The NBA is suspending game play following the conclusion of tonight’s schedule of games until further notice,” the league said in a statement, adding it would use the hiatus “to determine next steps for moving forward in regard to the coronavirus pandemic.”

The Jazz is home to Australia’s Joe Ingles and Dante Exum – both of whom also play for the Boomers.

Global shares crumbled after US President Donald Trump said America will suspend all travel from Europe as he unveiled measures to contain the coronavirus epidemic.

Trump said the United States will suspend all travel from Europe, except from the United Kingdom, to the United States for 30 days starting on Friday.

He also announced some other steps, including instructing the Treasury Department to defer tax payments for entities hit by the virus.

But investors were hardly convinced those measures will turn around the global economy as concerns grew that the number of infections could quickly snowball in many countries.

-with AAP

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