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The Federal Government has announced stage 2 of its economic plan to cushion the economic impact of coronavirus (COVID-19). We have pulled together the information that provides guidance on some of the stimulus measures announced prior to the passage of legislation. It builds on the first stimulus measures previously announced but introduces many new initiatives to help the economy deal with the direct and indirect impacts of the coronavirus.
To view stage 2 of the economic plan, click here.
The Government is acting decisively in the national interest to support households and businesses and address the significant economic consequences of the Coronavirus.
While the full economic effects from the virus remain uncertain, the outlook has deteriorated since the Government’s initial Economic Response announced on 12 March 2020.
The spread of the virus worldwide has broadened, and is expected to be more prolonged. Governments, both international and domestic, have announced stricter mitigation measures to slow the spread of the virus, which are having significant economic impacts.
On 22 March the Government announced a second set of economic responses which, combined with our previous actions, total $189 billion across the forward estimates, representing 9.7 per cent of annual GDP.
These actions provide timely support to affected workers, businesses and the broader community.
The Government’s economic response targets three areas:
The Australian Government is providing financial assistance to Australians. This assistance includes income support payments, payments to support households and temporary early releases of superannuation.
The Australian Government is supporting Australian businesses to manage cash flow challenges and retain employees. Assistance includes cash flow support to businesses and temporary measures to provide relief for financially distressed businesses.
The Government, the Reserve Bank of Australia and the Australian Prudential Regulation Authority have taken coordinated action to ensure the flow of credit in the Australian economy. Timely access to credit is vital for businesses to manage the impacts of the Coronavirus.
The Coronavirus Small and Medium Enterprises (SME) Guarantee Scheme will support up to $40 billion of lending to SMEs.
Under the Scheme, the Government will guarantee 50 per cent of new loans issued by eligible lenders to SMEs.
The Scheme will enhance lenders’ willingness and ability to provide credit, supporting many otherwise viable SMEs to access vital additional funding to get through the impact of Coronavirus.
The Scheme will be available for new loans made by participating lenders until 30 September 2020.
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