HOW THE GOVERNMENT IS RESPONDING

What

Income support for individuals

The Government is temporarily expanding eligibility to income support payments and establishing a new, time-limited Coronavirus supplement to be paid at a rate of $550 per fortnight. This would be paid to both existing and new recipients of Jobseeker Payment, Youth Allowance Jobseeker, Parenting Payment, Farm Household Allowance and Special Benefit.

Payments to support households

Provide two rounds of $750 payments to social security, veteran and other income support recipients and eligible concession card holders. Around half of those that benefit are pensioners. These payments will help to support confidence and domestic demand in the economy. The second payment will not be made to those eligible for the Coronavirus supplement.

Temporary early release of superannuation

Enable individuals and sole traders directly impacted by the economic consequences of the Coronavirus to access up to $10,000 of their superannuation, tax-free, in 2019-20, and up to a further $10,000 in 2020-21. No tax will be imposed on withdrawals.

Temporarily reduce superannuation minimum drawdown rates

Reduce the superannuation minimum drawdown rates by 50 per cent for the 2019-20 and 2020-21 income year.

Lower the social security deeming rates

Lower the social security deeming rates in response to the low interest rate environment.

What

Boosting cash flow for employers

The Government is providing up to $100,000 to eligible small and medium-sized businesses, and not-for-profits (NFPs) that employ people, with a minimum payment of $20,000. These payments will help businesses and NFPs with their cash flow so they can keep operating, pay their rent, electricity and other bills and retain staff.

Small and medium-sized business entities with aggregated annual turnover under $50 million and that employ workers are eligible. NFPs, including charities, with aggregated annual turnover under $50 million and that employ workers will now also be eligible.

Under the enhanced scheme, employers will receive a payment equal to 100 per cent of their salary and wages withheld (up from 50 per cent), with the maximum payment being increased from $25,000 to $50,000. In addition, the minimum payment is being increased from $2,000 to $10,000.

An additional payment is also being introduced in the July — October 2020 period. Eligible entities will receive an additional payment equal to the total of all of the Boosting Cash Flow for Employers payments they have received. This means that eligible entities will receive at least $20,000 up to a total of $100,000 under both payments.

Temporary relief for financially distressed businesses

Help businesses get through a temporary period of insolvency, by temporarily providing higher thresholds and more time to respond to demands from creditors and providing temporary relief from directors’ personal insolvent trading liability

Increasing the instant asset write-off

Lifting the threshold to $150,000 (from $30,000) — and making more businesses eligible to use it up to a turnover of $500 million.

Backing business investment

Offering businesses a time-limited incentive to invest, by accelerating depreciation deductions.

Supporting apprentices and trainees

Wage assistance to help small businesses to keep their apprentices and trainees.

Support for Coronavirus affected regions and communities

Financial support to help regions and communities most affected by the Coronavirus to recover.

Support for Australian airlines and airports

Provide initial support to our airline industry through up to $715 million of relief from a range of taxes and Government charges.

What

Government support for immediate cash flow needs of SMEs

Establish a loan guarantee arrangement between the Government and participating banks to cover the immediate cash flow needs of SMEs.

Australian Office of Financial Management Support

Provided the Australian Office of Financial Management with an investment capacity of $15 billion to invest in structured finance markets used by smaller lenders

Reserve Bank of Australia Support

The Reserve Bank of Australia (RBA) announced a package on 19 March 2020 that will put downward pressure on borrowing costs for households and businesses. Banks will have access to at least $90 billion in funding at a fixed interest rate of 0.25 per cent.

Quick and efficient access to credit for small business

The Government is cutting red tape by providing a temporary exemption from responsible lending obligations for lenders providing credit to existing small business customers. This reform will help small businesses get access to credit quickly and efficiently.

Australian Prudential Regulatory Authority — Ensuring banks are well placed to lend

The Australian Prudential Regulatory Authority has announced temporary changes to its expectations regarding bank capital ratios. The changes will support banks’ lending to customers, particularly if they wish to take advantage of the new facility being offered by the RBA.