A guide to the Government’s economic response to the Coronavirus
Looking after your business
Much of what is happening around the Coronavirus may feel uncertain. Here is a summary of the Australian Government’s economic response, the areas that have been targeted by the various stimulus packages, and some key resources to check for further information.
Support for businesses
Supporting the flow of credit
Supporting individuals and households
Jobkeeper wage subsidy
What: A “JobKeeper” wage subsidy to help keep more Australians in jobs and support businesses significantly impacted by the Coronavirus.
- The payment will apply to full-time, part-time and casual workers, as well as sole traders.
- Casual workers must have been with their employers for 12 months or more.
- Employees must be on the books as at 1 March (they may have since been fired but can be reinstated)
- Businesses with turnover under $1 billion, if they have taken a 30% revenue decrease.
- Businesses with turnover over $1 billion, if they have taken a 50% revenue decrease.
- The business is not subject to the Major Bank levy.
How much: Eligible businesses will receive a flat payment equal to $1,500 per employee per fortnight for up to 6 months.
1. Register your interest with the ATO
2. Administered via tax / single touch payroll (STP)system
3. If your business does not have STP, speak to your accountant
When: 1 May 2020, backdated to 1 March 2020.
Supporting flow of credit
1. Support for immediate cash flow needs for SMEs
What: To establish a loan guarantee arrangement between the Government and participating banks to cover the immediate cash flow needs of SMEs. The Commonwealth will guarantee 50% of an eligible loan to small business impacted by the virus.
Eligibility: Banks, non-bank lenders, SMEs with less than $50 million turnover per year, must be new or existing customers, no refinancing of existing customers.
Loan Terms: Up to 3 years and granted within the next 6 months, starting 1 April 2020, repayment-free for 6 months. Unsecured, for working capital.
How much: Up to $250,000
When: Early April and available for new loans until 30 September
Fact sheet: Supporting the flow of credit
2. Quick and efficient access to credit for small business
What: Temporary exemption from responsible lending obligations for lenders.
3. RBA – supporting the flow and reducing the cost of credit
What: A term funding facility for the banking system where Banks will have access to at least $90 billion in funding at a fixed interest rate of 0.25% to support households and businesses. A further easing in the cash rate to 0.25% is meant to encourage additional lending.
4. Support for non-ADI and smaller ADI lenders in the securitisation market
What: Provides the Australian Office of Financial Management with an investment capacity of $15 billion to invest in structured finance markets used by smaller lenders and non-ADIs.
5. APRA – ensuring banks are well placed to lend
What: The Australian Prudential Regulatory Authority has made 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.
Australian Government’s Economic Response:
Visit the Treasury website
Government’s specific measures for businesses:
Visit the Government’s Business website
Australian Taxation Office:
Visit the ATO website
The latest Government updates, news and response:
Visit the Government’s website
The latest health information:
Visit the Department of Health website
Updates from the Prime Minister:
Prime Minister of Australia website