The Prime Minister, Scott Morrison, has flagged a $17.6 billion-dollar stimulus package to deal with the Coronavirus fallout, funnel money back into the economy and to protect jobs.
The Prime Minister has said that $1.3 billion will be given in subsidies for employers of apprentices across the nation, including 9,000 in SA. Under the plan, the government will offer small businesses with fewer than 20 employees up to $7,000 wage assistance each quarter for every apprentice in an effort to retain existing apprentices and trainees.
Businesses with fewer than 20 full-time employees and additionally employers of any size and Group Training Organisations (GTO) that re-engage an eligible out-of-trade apprentice or trainee will also be eligible. The government is examining how best to pass this wage assistance through to small businesses who employ their apprentice through a GTO.
The Federal Government has also significantly expanded tax breaks for businesses, including an extension of the tax write-off scheme threshold from $30,000 to $150,000 to make it easier for businesses to purchase assets such as cars, trucks, harvesters, tools and other equipment.
The State Premier, Steven Marshall, has also announced that the State Government will inject $350 million into the local economy to address the fallout from the Coronavirus, bushfires and drought, securing local jobs, road upgrades and tourism.
The Premier has indicated that a vast amount of this money will be spent in the next 12 months and will focus on “shovel ready” projects like regional road repairs, hospital improvements and other work that can be started quickly.
$70 million of this package will also go into the Economic and Business Growth Fund and while some of this was part of a promise in the 2019/20 budget, it looks like this has been brought forward to help the economy now. The State Government's stimulus package also includes a $15 million boost to regional health projects and fire safety upgrades at Eudunda, Loxton and Kapunda and sterilisation facilities at Naracoorte, Kapunda and Angaston.
It will be important for MTA members to take advantage of State and Federal Government stimulus packages to take on more apprentices, keep existing apprentices employed and to keep your business going through a period of uncertainty in the next few months as we grapple with the fallout of the Coronavirus and economic hardships.
- $1.3 billion in subsidies (across 2019/20 and 2020/21) for 120,000 apprentices, of which approximately 9,185 are in SA
- Up to $25,000 payments to small and medium businesses to help boost cash flows
- An expansion of the tax write-off scheme making it easier for businesses to purchase items such as cars, utes and trucks, harvesters, tools and kitchen equipment. Current restrictions are expected to be significantly lifted, allowing companies with turnovers of up to $500 million (currently $50m) to make asset write-offs of up to $150,000 (currently $30,000)
- Welfare recipients, including pensioners and those on Newstart, will receive one-off payments
- The Government is also expected to announce temporary tax relief to encourage spending
- The package will include up to $21,000 per small business with apprentices (with less than 20 employees*)
- The business will receive $7,000 per quarter in wage assistance per apprentice, backdated from the start of the year, until the end of September
Employers can register for these apprentice subsidies from 2 April 2020. Click here to learn more.
*Businesses with fewer than 20 full-time employees and additionally employers of any size and Group Training Organisations (GTO) that re-engage an eligible out-of-trade apprentice or trainee will also be eligible. The government is examining how best to pass this wage assistance through to small businesses who employ their apprentice through a GTO.
If you want to learn more about how you can take advantage of these stimulus packages, click here to contact us.
It is good that these measures are being initiated but they must lead to outcomes that actually boost employment and sustain growth. It will be important that you take advantage of these stimulus packages to retain and take on more apprentices and act on opportunities to grow your business as we head into a period of uncertainty in the next few months.