COVID-19: Government stimulus packages through a regional lens

The Commonwealth, all State Governments and Territories have been acting quickly in announcing packages of support for business and workers affected by the COVID-19 restriction measures, and in announcing additional support for health services.

The RAI continues to analyse these packages to see what it means for regional Australia. We are collating the best information available about the impact of COVID-19 on our regions. With that knowledge, we will work to identify the gaps and provide solutions and innovative ideas to help regions through this challenging time.

To see the full overview of State, Territory and Commonwealth measures to support Australians through COVID-19, go to australia.gov.au.

Looking at the packages through a regional lens

Federal Government

The Commonwealth has announced three major stimulus packages which are well documented. These packages included the JobKeeper payment, changes to PAYG payments, support for apprentice and trainee wages and the $550 JobSeeker Coronavirus supplement. We have also seen additional measures significant for regional Australia. These include support for:

• Aviation, through $198 million to support the network of regional airlines;
• Freight, through the National Freight Coordinator;
• Temporary migrants and seasonal workers; and
• Childcare costs.

While the Commonwealth support has been for people and businesses across Australia, the first Commonwealth package included $1 billion of support for regional tourism, education and agriculture.

A $1.1 billion package was also announced to boost mental health services, domestic violence support, Medicare assistance for people at home and emergency food relief.

The States and Territories have all enacted support for businesses and households through deferral of collection of government levies like payroll tax, license fees and rates, and rent relief for tenants of government-owned premises. State- and territory-specific information is available on government websites listed below.

Below, we’ve taken a snapshot of some key measures pertinent to each state and territory.

Victoria

Victoria has a $500m Business Support Fund to assist the hardest-hit sectors, including hospitality, tourism, accommodation, arts and entertainment, and retail. Funding of $10,000 per business is available and will be allocated through a grant process. Small businesses are eligible if they employ staff, have been subject to closure or are severely impacted by Victoria’s Non-Essential Activity Directions, have a turnover of more than $75,000 and a payroll of less than $650,000.

Businesses across Victoria can now access information on dealing with COVID-19 by calling the Business Victoria hotline on 13 22 15.

For a full list of VIC information, go to dhhs.vic.gov.au/coronavirus.

New South Wales

The NSW Government has announced a $2.3 billion package to support jobs, healthcare, small business and the community. NSW small businesses struggling with the COVID-19 shutdown will receive grants of up to $10,000 under a new assistance scheme. Eligible industries are those that have been subject to closure or are greatly impacted by NSW Government health directions about COVID-19. They include retail trade, accommodation and food services, real estate services, administrative and support services, as well as arts and recreation services.

Small businesses can call the NSW Business Concierge Service to gain information about the support available on 13 77 88.

Queensland

The Queensland Government has announced a $3 billion package to support jobs and businesses. All small and medium enterprises (annual payrolls of $6.5 million or less) will be eligible for a two-month refund of payroll tax. $500 million has been made available to assist workers who have lost their job or income with retraining, job-matching and other help to transition into employment in the health care, agriculture, food production, transport, cleaning and mining industries.

Sole traders, small and medium businesses will get a $500 rebate on their power bill.

For a full list of QLD information, go to business.qld.gov.au.

Tasmania

Grants of $2,500 are available through the Department of State Growth as one-off emergency support payments, for eligible small businesses. A second $20 million round of $15,000 grants will be made available for small businesses in the identified sectors that are experiencing severe financial hardship. Businesses seeking this large grant should first apply for the Small Business Emergency Support Grant.

General practices and community pharmacies can apply for grants of up to $10 000, as one-off support payments. Small businesses looking to suspend activity due to the COVID-19 restrictions can apply to the Registrar of Motor Vehicles to freeze their business vehicle registrations for both light and heavy vehicles.

For a full list of TAS information, go to business.tas.gov.au.

Northern Territory

The Northern Territory Small Business Survival Fund delivers grants of up to $50,000 (for businesses with 20+ FTE’s). Sole traders may be eligible for a $2,000 grant. This fund is specifically targeted at supporting industries such as retail, hospitality, tourism and entertainment businesses.

Northern Territory’s Home Improvement Scheme gives eligible homeowners a voucher of up to $6,000 to go towards house improvements. Grants of up to $100,000 are available for not-for-profit and community organisations to engage local businesses to do repairs, renovations and upgrades to their property and facilities. The first $50,000 will be paid as a grant without you needing to co-contribute.

Tourism NT has partnered with KPMG to deliver immediate and targeted business support to tourism operators. The program provides two hours of dedicated, confidential support from qualified KPMG consultants.

For a full list of NT information, go to coronavirus.nt.gov.au.

South Australia

The South Australian Government’s Jobs Rescue Package has been announced to support key industries and local businesses. This package includes two new funds – The Business and Jobs Support Fund and the Community and Jobs Support Fund. $10,000 cash grants are available to help cover a business’ ongoing or outstanding operating costs, such as rent, power bills, supplier and raw materials costs and other fees.

An Export Recovery Taskforce has been established, and work has commenced to identify impacts across export sectors and to coordinate government intervention and support for affected businesses.

For a full list of SA information, visit the SA Treasury website.

Western Australia

The WA Government is providing guidance to clarify the criteria that can be applied in granting exemption from exploration expenditure requirements in Western Australia.

For eligible small businesses in WA, a one-off $2,500 credit is available for Synergy and Horizon Power customers. Keystart customers facing financial hardship due to COVID-19 can apply to defer principal repayments and waive interest costs by up to six months. $4.7 million in regional taxi assistance payments have been made available to around 200 former country taxi licensees.

The Small Business Development Corporation has created a COVID-19 assistance centre to provide dedicated support to small/medium business owners. To access the service, contact 133 140 or email [email protected]

For a full list of WA information, visit the WA Government website.

Australian Capital Territory

A business liaison phone line has been created to assist businesses to understand the support available to them through the ACT Economic Survival Package and practical advice for businesses operating through changed arrangements due to COVID-19. The number that businesses can call is 02 6205 0900.

For a full list of ACT information, visit the ACT Government website.

Looking to the future

Some jurisdictions have moved to announce industry-driven responses, especially through support packages for industries such as tourism, aviation and trucking. Queensland is developing a series of dedicated industry responses, Tasmania and South Australia both have tourism measures, and Tasmania also has measures for health, events and creative arts.

Some jurisdictions are earlier in their implementation, from which others can learn. Most seem to be refining their support measures as they go, building in a tighter industry focus. It is possible that in coming weeks a regional lens may also start to be used and that more localised responses will be supported.

Regional Workforce Issues

The regional labour market is a mix of surplus labour in the industries most affected by the shutdown regulations, alongside labour shortages particularly in farm production, picking and packing. The closure of international borders has stopped the flow of temporary migrants – skilled and non-skilled – that many regional businesses rely on. And the closure of state borders has disrupted the flow of FIFO workers in the mining and infrastructure industries.

Development of an efficient regional labour market has become even more critical. While self-sufficiency cannot be achieved in the short term, new mechanisms are being developed quickly to fast track job matching and skills development. (E.g. upskilling nurses with intensive short courses and bringing nurses who are out of practice back into practice). Job vacancy numbers held up in February but are likely to drop sharply through March as new postings have dropped.

This combination of labour surpluses and labour shortages is a difficult message to communicate as it does not tell a simple story of job decline or regional growth. The reality is that economic activity is down in many industries in all regions, but that this is coinciding with harvesting and food production and labour shortages in other regions. Some jurisdictions are responding to job displacement by ‘matchmaking’ jobs regionally, to provide work to those who have lost it and fill emerging employment needs. Victoria has a $500 million Working for Victoria Fund aimed at redeploying workers who have lost their jobs. It includes an agricultural workforce component to facilitate job matching and training. The Northern Territory has a new jobs portal, and Tasmania is working with the Tasmanian Chamber of Commerce and Industry on a job matching service.

On the job creation side, the New South Wales Government is fast-tracking infrastructure and maintenance projects to bolster economies. New South Wales is also expanding and accelerating bushfire measures as part of their COVID response. South Australia is also fast-tracking infrastructure spending.

Victoria has specific initiatives to support community connectedness – aiming to reduce the effects of social isolation on wellbeing and feelings of loneliness.

New South Wales, South Australia and Queensland are actively looking to foster regionalised manufacturing of essential items, inviting manufacturers to retool to make critical items like sanitizer, surgical masks and ventilators.

Many jurisdictions are collecting their own qualitative data from on-ground staff or the RDA networks, and some jurisdictions are collecting their own quantitative data too. The Commonwealth, South Australia and Victoria are gathering data through their RDA networks, and sharing of the nature of the information being gathered would be useful. The Northern Territory is making personal contact with businesses, and Victoria is using its regional offices.

Current concerns

• There is some difficulty defining ‘essential services’ across jurisdictions, and the flow-on implications of these definitions on what business activities are permitted at each level of contact restriction.
• There is a common desire for better data tracking impacts across regions and industries. The ABS has increased its data gathering and is providing regular updates of relevant material from across its collections on a dedicated webpage (abs.gov.au/covid19) and may conduct more frequent business surveys.