The government is fast tracking a second wave of stimulus measures as Australia stares down the “grim reality” of a recession.
The federal government is yet to legislate its first stimulus package of $17.6 billion, but work has already begun on a second stimulus, set to be deployed ahead of the May budget.
“We are looking at some pretty significant options that we would never have considered in the past,” Finance Minister Mathias Cormann told media.
“We are working our way through that as we speak and we will be making announcements as soon as we can.”
The first stimulus package included a $700 million instant asset write-off scheme for assets up to $150,000 and $6.7 billion in support for small and medium-sized businesses.
The tourism and hospitality industries have been hit hardest by the one-two punch of the bushfire emergency and coronavirus outbreak.
“We are focused on supporting those businesses and those workers most affected by the downturn as a result of the coronavirus,” Mr Cormann said.
“We are very conscious of the challenges out there. Businesses will close, people will lose their jobs and we are very, very focused on making sure that we provide the necessary support now through the transition, but also to ensure we have the strongest possible bounce back on the other side of this period.
Mr Cormann also said that the coronavirus might give some workers an opportunity to “job swap” from areas that are badly impacted into areas where there is significant demand – like supermarkets.
The government has previously derided efforts taken by the Rudd Government in 2007 as the GFC began to impact Australia, but is now being forced to substantially expand its own stimulus package at the possible expense of the oft-touted surplus.
The announcement of a new stimulus follows extraordinary measures taken by monetary authorities over the last week, including the multibillion dollar expansion of the RBA’s repo operations and the announcement that it was considering launching a quantitative easing program in the near future.