Planned cuts to Tasmanian government agencies removed under coronavirus stimulus package

By Shannon Jenkins

Tuesday March 17, 2020

Peter Gutwein. AAP Image/James Gourley

The Tasmanian government is abandoning planned cuts to state government agencies as part of its $420 million COVID-19 support package.

On Tuesday Premier Peter Gutwein said the package would support the public sector and provide “targeted assistance” to businesses and the workforce to help retain jobs.

“The health, safety and wellbeing of Tasmanians is our number one priority as we face the challenge of coronavirus, and we will continue to manage the risk of the virus based on the best and latest evidence and medical advice,” he said.

“We know this pandemic will also have very real and significant economic consequences, and our government will do everything it can to manage and mitigate those impacts on businesses, jobs, families and the Tasmanian community.”

The government will remove the efficiency dividend on state government agencies over the forward estimates, according to Gutwein.

It will also allocate $50m to interest free loans over three years for local governments. The loans will “encourage” local governments to improve tourism assets by investing, and employing Tasmanians to undertake upgrades, renovations and necessary maintenance, “so that when the visitors come back we are ready”, Gutwein noted.

Funding worth $50m will also be brought forward for the maintenance of public buildings over the next 12 months.

Agencies will be required to pay small to medium businesses quickly, to improve cash flow. Unless otherwise required by contractual arrangements, the normal terms of trade for payments by government agencies will be reduced from 30 days to 14 days.

A youth employment payroll tax rebate scheme will be introduced from April 1, “to encourage businesses to employ young people”, while $2.1m will go towards one-off $5000 grants for businesses that hire an apprentice or trainee.

For those who are required to self-isolate as a result of the coronavirus, the government will allocate one-off emergency relief payments of $250 for individuals and up to $1000 for families.

Organisations such as the Salvation Army, The Red Cross and Rural Business Tas will receive $1m through Communities Tasmania so they can better support vulnerable people through the provision of food hampers, medical supplies or counselling.

The primary health care sector will receive $2m to support GPs, pharmacists and other health care providers, while $1m will go towards supporting front line workers with accommodation in a number of circumstances — if a family member is ill, for example — “so they can continue to contribute to our response”.

An additional $1m in grants will go to mental health organisations to support individuals experiencing mental health difficulties due to the COVID-19 pandemic.

The government will also establish an emergency accommodation support fund of $1m for individuals and families who have been placed on home quarantine, but cannot return to their regular place of residence due to self-isolation measures.

The government has also devoted $20m for loans to businesses in the hospitality, tourism, seafood and exports sectors. Small businesses with a turnover of less than $5m can access the loans to purchase equipment or restructure business operations. They will be interest free for up to three years.

Payroll tax for the last four months of this financial year will also be waived for hospitality, tourism and seafood industry businesses, to save them roughly $7m and “to keep more Tasmanians employed”.

Based on the immediate impact of the coronavirus on their company, other small to medium businesses with an annual payroll of up to $5m can apply to have their payroll tax payments waived for the three months from March 31 to June 2020.

A range of other funds will be provided, including $100,000 for the Tourism Industry Council of Tasmania and the Tasmanian Hospitality Association, $80,000 for the Tasmanian Chamber of Commerce and Industry, and a 50% discount on liquor licencing fees.

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