$42 billion stimulus package unveiled

The federal government has unveiled a massive $42 billion plan aimed at retaining 90,000 jobs over the next two years, fix roads and railways, improve schooling facilities and boost community infrastructure amid the global financial crisis.

The federal government has unveiled a massive $42 billion plan aimed at retaining 90,000 jobs over the next two years, fix roads and railways, boost community infrastructure and improve schooling facilities amid the global financial crisis.

Billed as a "rapid response" to the deteriorating global economic conditions, the centrepiece of the 72-page plan is $28.8 billion of spending on schools, housing, energy efficiency in homes, community infrastructure and roads, and support to small business to be delivered mostly in 2009-10 and 2010-11.

Bonus payments

The remaining third of the plan is an immediate injection of $12.7 billion in one-off bonus payments of $950 each for low- and middle-income households and individuals through five bonuses to be paid in the next few weeks through either the Australian Tax Office or Centrelink.

It means 8.7 million workers earning $100,000 or less will receive a lump sum payment of $950 each from April.

About 1.5 million single-income families will also receive the payment, provided they receive Family Tax Benefit Part B, in the fortnight beginning March 11.

Farmers will also receive a $950 bonus payment, as will families eligible for FTB Part A who have a child at school. They will receive an immediate payment of $950 this week.

Training and learning bonus

The government will also provide a one-off $950 training and learning bonus for eligible students and people outside of the workforce returning to study to help with the costs of education and training.

The package, which is virtually a mini-budget in all but name, is the second major economic stimulus package announced by the government since the $10.4 billion economic security strategy released in October.

It takes the total amount spent by the government on stimulating the economy since September to $88.7 billion, including bank deposit guarantees, the car industry package, as well as investment in residential-backed mortgage securities, local government, infrastructure projects, and on the states through the Council of Australian Governments (COAG).

The statement said while the nation was in a better position than most other countries to weather the global recession, Australia could no longer "resist the pull of global economic forces".

$890 million for roads, railways, community infrastructure

The infrastructure spending in this package involves a major roll-out of $890 million to fix accident black spots, install rail boom gates, repair regional roads and build community infrastructure such as libraries, town halls, community centres and sport centres.

Schools around Australia will benefit from $14.7 billion over three years to construct school halls, libraries, indoor sports facilities and performing arts centres.

New facilities for primary, secondary schools

The package includes funds of between $250,000 and $3 million for primary schools for capital expenditure projects and $1 billion for the construction of science and language laboratories in secondary schools, while all schools will be able to apply for extra funding of between $50,000 and $200,000 for minor maintenance and infrastructure.

Public and community housing will receive a $6 billion boost to allow for the construction of about 20,000 new homes to be completed by December 2010.

Tax breaks for small businesses

Small business also gets $2.7 billion in extra tax breaks aimed at supporting jobs.

This means, for example, a business which buys a $2,000 computer by the end of June this year will receive a $600 additional deduction while a business which buys a $60,000 backhoe before the end of June will receive an extra $18,000 deduction.

The government will also provide free ceiling insulation to 2.7 million homes to improve energy efficiency by increasing the solar how water rebate from $1,000 to $1,600 from Tuesday and the low emissions plan for renters rebate will double to $1,000.

Major points in $42 billion mini-budget:

* $14.7 billion to be invested in school infrastructure and maintenance and bringing forward funding for trade training centres;

* $6.6 billion for to increase the national stock of public and community housing by about 20,000;

* $3.9 billion to provide free insulation to 2.7 million homes and solar hot water rebates;

* $890 million to fix regional roads and blackspots, to install railway boom gates and for regional and local government infrastructure;

* $2.7 billion small and general business tax break to provide deductions for some equipment purchases before the end of June 2009;

* $12.7 billion for immediate one-off payments to working Australians, families with school-age children, farmers, single income families and for those undergoing training.


Source: AAP

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