❓ The Treasurer outlines the WA government's $1 billion relief package for small businesses impacted by COVID-19, including payroll tax waivers, utility bill support, and fee waivers for affected industries, complementing Commonwealth initiatives like JobKeeper.
AnsweredQoN 6Legislative Assembly
QuestionView source ↗
CORONAVIRUS —
SMALL BUSINESS — RELIEF MEASURES
6. Mr Y. MUBARAKAI to the Treasurer:
I refer to the state government's response to the
impact of COVID-19 on the WA economy. Can the Treasurer outline to the house
how the $1 billion in additional relief measures announced today will support
small businesses over the coming months?
SMALL BUSINESS — RELIEF MEASURES
6. Mr Y. MUBARAKAI to the Treasurer:
I refer to the state government's response to the
impact of COVID-19 on the WA economy. Can the Treasurer outline to the house
how the $1 billion in additional relief measures announced today will support
small businesses over the coming months?
AnswerView source ↗
I thank the member for Jandakot for his question. We have not
seen anything like this before. Certainly no-one alive today has seen this sort
of impact. I guess the fact that we are so globalised and so interconnected
means the impacts will be more dramatic. There has effectively been a sudden
halt to global output almost overnight. The Organisation for Economic
Cooperation and Development's best modelling at the moment is that we
are looking at about a two per cent reduction in global gross domestic product
for each month that these global restrictions are in place. That is not even
taking into account the likely long-term health spends that will take place
around the world, but also no-one is entirely certain about the impacts of what
has been announced around the world in the form of very, very large spend
packages from a range of different governments. We have been working very
closely with the commonwealth government to ensure that our announcements and
spends at a state government level complement the commonwealth government. As
the Premier just pointed out, there is no doubt that the commonwealth
government has the capacity to do the sorts of things it did yesterday with the
JobKeeper package, and with a central bank and the ability to buy bonds et cetera
means it has a much greater capacity to provide that sort of support. I want to
acknowledge the JobKeeper package. It is something we have not seen before in
Australia, but it is something that will go a long way towards relieving the
anxieties that we are seeing around Australia. That is why our package
announced today complements that perfectly. We want to ensure that businesses
and households in Western Australia can batten down the hatches over the next
few months to get through what will be the clear, direct impact of COVID-19 on
the broader economy.
By way of an aside, I want to make this point: the economy is
not something that is esoteric; the economy ensures that our supermarkets are
fully stocked with food. That is what delivers it there. We want to make sure
that we protect that as much as we can.
In addition to our previous announcements and complementing
the commonwealth government's announcement, we today announced a range
of things including a waiver of payroll tax for those with a payroll under $7.5
million from 1 March until 30 June, and then, of course, the $17 500 payment
will come through in July in support of those businesses. That is very
important. I have said wherever I can that it has been very difficult to try to
target those businesses that are below the payroll tax threshold. All state
Treasurers have struggled with this. Looking at all the packages announced by
state Treasurers, they have not been able to target those businesses. The fact
that we have Synergy as a state-owned entity has allowed us to do that today,
via a $2 500 payment into some 95 000 small businesses. For some of those, that
will effectively mean nearly 12 months of their power bill will disappear. For
some, of course, it will not cover as much—it depends on their average
power use—and also I expect in slower economic times that will go
somewhat further, but that is a significant spend, $250 million, supporting
those smaller businesses.
I have already mentioned the payroll tax waiver. We have also
allocated $100 million. Clearly, there will be industries more affected by
COVID-19 than others. Most industries will have a licence or some form of fee
that they pay to the state government. We want to ensure that we can waive
those fees on the industries that are particularly impacted. The Premier has
outlined what we are doing in respect of ensuring that people are not
disconnected from power and water in the event that they cannot pay those
bills, and similarly some relief with Keystart. We will have more to say around
protecting tenants from eviction during this period. I think that complements
very nicely the commonwealth government's announcements around
bankruptcy and insolvency efforts. What it has effectively done in its first
package announcement is ensure that letters of demand cannot be acted upon
immediately. Normally, it is 21 days—that has been pushed out to six
months. An eviction moratorium for a similar period is more than appropriate.
That is why the JobKeeper package from the commonwealth is so important. That
should hopefully mean that many employers can keep employees on. They can
hopefully negotiate with their landlords an alternative rent arrangement to
keep them there and to keep things ticking over while everybody is battening
down the hatches during this period. It is clear that all governments around
the globe will have a significant health spend. There is no doubt about that.
We have allocated $500 million for our health spend and other frontline
services.
I want to finish with this point: we also need to have the
capacity to ensure that we can recover out of this because, ultimately, we need
to be able to recover. It is pointless blowing all the fiscal capacity now,
bearing in mind that I think the state and commonwealth packages have provided
the perfect support for this period of hibernation, to borrow the commonwealth's
word, or as I have been saying, to allow households and businesses ''to
batten down the hatches'' during this period. We are already working on
what a recovery might look like, but I suspect that will be a significant spend
over consecutive budgets as we go about recovering from what will no doubt be
perhaps the biggest economic and health shock that we will see in our lifetimes.
seen anything like this before. Certainly no-one alive today has seen this sort
of impact. I guess the fact that we are so globalised and so interconnected
means the impacts will be more dramatic. There has effectively been a sudden
halt to global output almost overnight. The Organisation for Economic
Cooperation and Development's best modelling at the moment is that we
are looking at about a two per cent reduction in global gross domestic product
for each month that these global restrictions are in place. That is not even
taking into account the likely long-term health spends that will take place
around the world, but also no-one is entirely certain about the impacts of what
has been announced around the world in the form of very, very large spend
packages from a range of different governments. We have been working very
closely with the commonwealth government to ensure that our announcements and
spends at a state government level complement the commonwealth government. As
the Premier just pointed out, there is no doubt that the commonwealth
government has the capacity to do the sorts of things it did yesterday with the
JobKeeper package, and with a central bank and the ability to buy bonds et cetera
means it has a much greater capacity to provide that sort of support. I want to
acknowledge the JobKeeper package. It is something we have not seen before in
Australia, but it is something that will go a long way towards relieving the
anxieties that we are seeing around Australia. That is why our package
announced today complements that perfectly. We want to ensure that businesses
and households in Western Australia can batten down the hatches over the next
few months to get through what will be the clear, direct impact of COVID-19 on
the broader economy.
By way of an aside, I want to make this point: the economy is
not something that is esoteric; the economy ensures that our supermarkets are
fully stocked with food. That is what delivers it there. We want to make sure
that we protect that as much as we can.
In addition to our previous announcements and complementing
the commonwealth government's announcement, we today announced a range
of things including a waiver of payroll tax for those with a payroll under $7.5
million from 1 March until 30 June, and then, of course, the $17 500 payment
will come through in July in support of those businesses. That is very
important. I have said wherever I can that it has been very difficult to try to
target those businesses that are below the payroll tax threshold. All state
Treasurers have struggled with this. Looking at all the packages announced by
state Treasurers, they have not been able to target those businesses. The fact
that we have Synergy as a state-owned entity has allowed us to do that today,
via a $2 500 payment into some 95 000 small businesses. For some of those, that
will effectively mean nearly 12 months of their power bill will disappear. For
some, of course, it will not cover as much—it depends on their average
power use—and also I expect in slower economic times that will go
somewhat further, but that is a significant spend, $250 million, supporting
those smaller businesses.
I have already mentioned the payroll tax waiver. We have also
allocated $100 million. Clearly, there will be industries more affected by
COVID-19 than others. Most industries will have a licence or some form of fee
that they pay to the state government. We want to ensure that we can waive
those fees on the industries that are particularly impacted. The Premier has
outlined what we are doing in respect of ensuring that people are not
disconnected from power and water in the event that they cannot pay those
bills, and similarly some relief with Keystart. We will have more to say around
protecting tenants from eviction during this period. I think that complements
very nicely the commonwealth government's announcements around
bankruptcy and insolvency efforts. What it has effectively done in its first
package announcement is ensure that letters of demand cannot be acted upon
immediately. Normally, it is 21 days—that has been pushed out to six
months. An eviction moratorium for a similar period is more than appropriate.
That is why the JobKeeper package from the commonwealth is so important. That
should hopefully mean that many employers can keep employees on. They can
hopefully negotiate with their landlords an alternative rent arrangement to
keep them there and to keep things ticking over while everybody is battening
down the hatches during this period. It is clear that all governments around
the globe will have a significant health spend. There is no doubt about that.
We have allocated $500 million for our health spend and other frontline
services.
I want to finish with this point: we also need to have the
capacity to ensure that we can recover out of this because, ultimately, we need
to be able to recover. It is pointless blowing all the fiscal capacity now,
bearing in mind that I think the state and commonwealth packages have provided
the perfect support for this period of hibernation, to borrow the commonwealth's
word, or as I have been saying, to allow households and businesses ''to
batten down the hatches'' during this period. We are already working on
what a recovery might look like, but I suspect that will be a significant spend
over consecutive budgets as we go about recovering from what will no doubt be
perhaps the biggest economic and health shock that we will see in our lifetimes.
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