A $20 billion loan guarantee for small businesses, $31.9 billion of grants to encourage small businesses to keep workers and $18 billion of support for welfare recipients and people who lose their jobs are the key elements in the federal government’s second round COVID-19 economic response.
That adds to a $17.6 billion stimulus package announced earlier this month, $15 billion to buy asset backed securities from small lenders, and a $90 billion Reserve Bank facility for bank liquidity.
Adding to a total of $189 billion, the combined packages are equal to about 10 per cent of GDP.
Small and medium sized businesses and non-profits with turnover below $50 million will receive payments of up to $100,000 to pay bills and retain staff.
That will cost $31.9 billion.
A loan guarantee scheme will underwrite 50 per cent of new small business loans up to a value of $20 billion, which would support $40 billion of loans.
There’s also a big regulatory change which will increase the threshold for creditors issuing statutory demands, and will provide relief for directors trading while insolvent.
Direct payments to households will include a $550 per fortnight Coronavirus supplement as an addition to existing JobSeeker, Youth Allowance