Government announces $66 Billion COVID-19 Stimulus Package (Melbourne)

23 March 2020

The Government has introduced a further $66 billon initiative to assist small to medium businesses given the uncertainty and economic impact of COVID-19.


The second stimulus package may be segregated into the three broad target areas: Individuals & households. Business and Banking and credit.


Target Area 1: Supporting Individuals and Households

  1. Income support for individuals

A Time-limited Coronavirus Supplement to be paid at $550 per fortnight to the following:

  • Jobseeker payment (replacing Newstart Allowance)
  • Youth Allowance Jobseeker
  • Parenting Payment
  • Farm Household Allowance
  • Special benefit Recipients

The one-week Ordinary Waiting Period will be waived. Both the Liquid Asset Test Waiting Period (LAWP) and the Seasonal Work Preclusion Period (SWPP) will also be waived for eligible individuals.

Applicants may also declare rental outgoings to qualify for Rent Assistance.

In other words, an eligible individual may access the general Jobseeker payments (see below), the Coronavirus Supplement ($550) and Rent Assistance.

Timing: (Coronavirus Supplement Period)

Payment to commence 27 April 2020 and will end in 6-months

Further Details:

Access of Jobseeker payments has been expanded to include:

  • Permanent employees who are stood down or lose their employment
  • Sole traders
  • Self- employed
  • Casual workers; and
  • Contract workers

Individuals will need to meet the income tests.


A summary of the Jobseeker payments is outlined below:

Your situation[1]

Max fortnightly payment


(no children)



(with child/ children)


Single >60 yo, after 6 months of continuous payments



$518.80 each

Single parent carer



Reduced Means Testing:

Asset testing with be waived during the supplementary payment period for:

  • Jobseeker payment (replacing Newstart Allowance)
  • Youth Allowance Jobseeker
  • Parenting Payment

Note: income testing remains for other payments.

Eligible individuals are required to declare that they are not accessing employer entitlements (Annual leave and/ or sick leave) or Income Protection Insurance at the same time as receiving the income support. Initial declaration would include:

  • Identity,
  • Residency status
  • Income
  • Proof of redundancy or reduction of work hours as a result of the economic downturn due to Coronavirus

Sole Traders & self-employed applicants will be required to make a declaration that their business has been suspended or had reduced.


Faster Claims:

  • Identification verification will be facilitated via calls or online facilities to reduce in person contact


  1. Payments to support households:

This measure is targeted to benefit pensioners and eligible concession card holders. This measure seeks to expand on the first payment announced on 12 March 2020.

Eligible individuals may receive both a first and second payment capped at $750 each round per person.

Timing: (Coronavirus Supplement Period)

Automatic First Payment to commence on 12 March 2020

Automatic Second Payment from 13 July 2020

Further Details:

Individuals eligible to receive the Coronavirus Supplement outlined above will not be able to access the second $750 payment.

Eligible individuals must be residing in Australia and receiving one of the payments/ hold a concession card to remain eligible for the second $750 payment.

Payments will be administered via Services Australia or the Department of Veterans’ Affair.

  1. Temporary early release of superannuation

Eligible individuals will be able to apply online through myGov to access up to $10,000 of their superannuation before 1 July 2020 and may seek to access up to a further $10,000 from 1 July 2020 for approximately three months. A certification will be required to confirm impacted individuals meet any of the eligibility criteria outlined below:



Eligibility Criteria:

  • Taxpayer is unemployed;
  • Taxpayer is eligible to receive a job seeker payment, youth allowance for jobseekers, parenting payment (which includes the single and partnered payments), special benefit or farm household allowance; or
  • After 1 January 2020:
  • Taxpayer was made redundant; or
  • Working hours were reduced by 20% or more; or
  • Suspension or downturn of business if the individual is a sole trader.

Note the amount released from superannuation will not be subject to tax and will not impact the Centrelink or Veteran’s Affairs payments.


  1. Temporarily reducing superannuation minimum drawdown rates

The superannuation minimum drawdown requirements for account-based pensions and similar products will be reduced by 50% for the 2020 income year and the 2021 income year.


Default Rates

Reduced rates























Note: if the default amount has been withdrawn, individuals are not able to re-contribute amount above the reduced rates.


  1. Reducing social security deeming rates

Upper and lower social security deeming rates will be reduced by a further .25 percentage points in addition to the .5 percentage point reduction to both rates announced on the 12th of March.

The upper deeming rate will be 2.25 percent and the lower deeming rate will be .25 percent.



Target Area 2: Support for businesses

  1. Boosting cash flow for employers

A tax-free payment will be made to eligible employers to assist with cash flow.

Small to medium sized business entities and NFPs with an aggregated annual turnover under $50million that employ workers are eligible to the payment.

Eligibility will be based on prior year’s turnover.

Payments will only be available to active eligible SME employers established prior to 12 March 2020. NFPs are not subject to this eligibility requirement. The SME must remain active to remain eligible to the additional payment.


Payment to commence 28 April 2020 and will apply to March 2020 BAS/IAS to September 2020 BAS/IAS.

Further Details:

As outlined in the 12 March 2020 announcement, the payment will be delivered as a credit in the activity statement system upon lodgement of the March 2020 quarterly or monthly BAS/ IAS. The credits will be administered as part of lodgement and processing of the Business Activity Statements (BAS) and Instalment Activity Statement (IAS) for the relevant period.

Initial Payment:

Eligible SMEs and NFPs with a turnover of less than $50m that employ staff between 1 January 2020 and 30 June 2020 will receive between $10,000 to 100 per cent of the amount withheld, capped at $50,000 in relation to the March 2020 to June 2020 BAS/IAS.

Additional Payment:

Quarterly lodgers’ each additional payment will be equal to half of their total initial Boosting Cash Flow for Employers payment (capped at $50,000) via the June 2020 BAS and September 2020 BAS.

Monthly lodgers will be eligible to receive the additional payment for June, July, August and September 2020. Each additional payment will be equal to ¼ of their total initial payment (capped at $50,000).

  1. Temporary relief for financially distressed businesses

The Treasurer will be given a temporary instrument making power to temporarily amend provisions of the Act to provide relief or modify obligations to enable officeholder’s compliance with legal requirements.

This package is aimed at a reduction of threat of actions that could potentially push businesses into insolvency and force the winding up of businesses. The proposed measures include:

  • Temporarily increasing the creditors statutory demand threshold from $2,000 to $20,000;
  • Increasing the statutory demand respond timeframe from 21 days to 6 months for companies;
  • Increasing the minimum amount of debt required for a creditor to initiate bankruptcy from $5,000 to $20,000;
  • Increasing the bankruptcy respond timeframe from 21 days to 6 months for a debtor
  • Extension of period of protection a post declaration of intention to present a debtor’s petition from 21 days to 6 months; and
  • Temporary relief for directors from any personal liability for trading while insolvent with respect to debts incurred in the ordinary course of business.

Businesses or directors facing significant hardship are encouraged to contact the ATO to discuss a tailored approach to the outstanding liabilities and obligations. The ATO Emergency Support Infoline is 1800 806 218.


Six months from the date the instrument is made under Treasurer’s instrument-making power under the Corporations Act 2001.


Target Area 3: Supporting the flow of credit

  1. Coronavirus SME Guarantee Scheme

The Government will provide a guarantee of 50 per cent to SME lenders for new unsecured loans to be utilised as working capital


This scheme is expected to commence by early April 2020 and remain available for new loans made by participating lenders until 30 September 2020


SMEs with a turnover of up to $50 million will be eligible with the loans being subject to lenders’ credit assessment

Terms of the loan

  • Maximum total size of loans of $250,000 per borrower
  • Loan duration will be up to three years, with an initial six-month repayment holiday
  • The loan will be unsecured
  1. Access to credit for Small Businesses

Temporary exemption from responsible lending obligations will be provided to lenders in an attempt to aid small businesses to get access to credit quickly and efficiently.

This exemption would apply to any credit for business purposes including:

  • New credit
  • Credit limit increase
  • Credit variations
  • Credit restructures
  1. Reducing the cost of credit

The RBA announced a term funding facility available to banks of $90 billion funding at 0.25 per cent fixed interest rate. This low-cost funding facility is to assist banks in reducing the rates for borrowers and encouraging lending and business lending, with incentives applying to new loans to SMEs.


Our Partners and team at PKF Melbourne are ready to assist you with your queries in relation to the stimulus package announcements. Please don’t hesitate to contact your lead partner or team member to discuss in further detail. Please contact us on 03 9679 2222.