Calls for Morrison government to match UK wage guarantee


The $66 billion includes $25.2 billion in payments to small business to help pay wages and loan guarantees for small businesses worth $20 billion, an amount that is not direct spending but is equivalent to half the value of the lending by the banks.

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This means there will be another $21 billion in stimulus measures to be revealed on Sunday.

The Morrison government calculates the full suite of measures to be worth 9.7 per cent of gross domestic product, but it has combined its own decisions with those from the independent central bank in a way that makes it difficult to compare with stimulus programs in the past.

The government estimates the Australian economic response is greater than the stimulus measures worth 4.5 per cent of GDP in Canada, 4.5 per cent in Hong Kong and 4 per cent in South Korea.

But the stimulus will be scrutinised by business and unions that have been calling for greater action.

Peak union group the ACTU is demanding the federal government agree to “at least the equivalent” of UK Prime Minister Boris Johnson’s wage subsidy of 80 per cent of British workers’ pay if they remain employed.

Speaking ahead of the Morrison government’s latest stimulus, ACTU president Michele O’Neil said the UK measure was needed to avoid “mass unemployment” as businesses hit by the coronavirus – especially those in travel and hospitality – prepare to stand down workers in unprecedented numbers.

The United States government was on Saturday finalising the details of a $US1 trillion-plus stimulus package, with lawmakers debating whether to give cash payments directly to workers, expand unemployment insurance – or a combination of the two.

Federal Labor’s industrial relations spokesman Tony Burke called on the Australian government to guarantee the pay of 3.7 million casual workers, who did not have access to sick pay if they had to self-isolate for two weeks.

“Some are already seeing their hours, their jobs and their livelihoods disappear,” Mr Burke said.

The Trump administration plan is to pump billions of dollars into $US1200 ($A2071) direct cheques to Americans, and billions to small businesses to pay workers stood down during the pandemic, delaying corporate taxes and providing zero-interest loans.

Airlines would receive $US50 billion in “loans and loan guarantees” and a $US150 billion fund would be set up to help rescue other industries hurt by the coronavirus downturn.

Small businesses would be able to access $US300 billion worth of loans capped at $US10 million each, and could be eligible to have their loans forgiven at a future date if they retain their employees during this period at the same level as before the coronavirus hit.

President Trump has already signed into law a $US100 billion-plus bill to boost testing for the coronavirus and guarantee paid sick leave for millions of workers hit by it.

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The UK Prime Minister has announced an unprecedented £30 billion stimulus plan, including grants to enable companies to pay to 80 per cent of an employee’s wage – capped at £2500 ($5000) per month – on the condition the worker is not fired, for as long as needed.

Mr Johnson has promised to boost welfare payments for 4 million low-income households by a total of £7 billion ($A14 billion).

The UK has also unveiled £330 billion in loans for struggling businesses, equivalent to about 15 per cent of GDP, to help businesses pay rent, suppliers and wages, and a £30 billion tax holiday.

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In a program worth £20 billion, all retail, leisure and hospital businesses will not have to pay rates for a year and many of the smaller firms in those sectors will be handed a £25,000 cash payment.

The government has also struck a deal with major banks to provide a three-month mortgage holiday for anyone who needs help.

New Zealand finance minister Grant Robertson this week announced an initial $NZ12.1 billion economic stimulus package – equivalent to about 4 per cent of the nation’s gross domestic product – including provisions to keep employers from laying off workers and to subsidise workers needing to self-isolate.

The $12.1 billion package includes $NZ500 million for health, $600 million initial aviation support package, $NZ5.1 billion in wage subsidies, $NZ126 million in COVID-19 leave and self-isolation support and $2.8 billion income support payments through the welfare system.

Germany is expected to pass a supplementary budget for this year of at least €100 billion, with details to be finalised over the weekend, along with a rescue fund for companies worth about €500 billion.

France announced a €45 billion aid package for more than 3.5 million businesses, €8.5 billion for extra unemployment benefits and €2 billion for the self-employed and shopkeepers.

The French government will also guarantee bank loans up to €300 billion.

Spain has announced a €200 billion coronavirus stimulus package, including up to €100 million to guarantee liquidity for businesses.

The package includes a moratorium on mortgage payments and measures to stop tenants from being evicted.

The Spanish government will guarantee water, electricity and internet services to vulnerable households and provide assistance to self-employed workers.

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