Scott Morrison’s coronavirus travel package: put half your holiday on us

Taxpayers will bankroll 800,000 half-priced airfares under a $1.2bn stimulus package aimed at shielding the aviation and tourism ­industries.

Virgin Australia crew Nico Porter, Bianca Yates, Captain Paul Anderson and Delia Taylor are set to befit from government assistance. Picture: John Feder

Taxpayers will bankroll 800,000 half-priced airfares under a $1.2bn stimulus package aimed at shielding the aviation and tourism ­industries, and throwing a lifeline to regional economies when the $90bn JobKeeper wage subsidy scheme ends this month.

Cheap loans will also be offered to small and medium businesses coming off JobKeeper on March 28, with the federal government increasing its exposure to help keep employers afloat.

Scott Morrison on Thursday will announce the government will subsidise a 50 per cent discount on domestic fares to ­13 tourism-dependent regions, ­including the Gold Coast, Cairns, the Whitsundays, Alice Springs, Broome, Kangaroo Island and Merimbula.

Qantas and Virgin will also be provided monthly retention payments that will be used as part subsidies for the wages of 8600 international aviation employees and ensure planes are flight-ready in anticipation of overseas travel resuming when the vaccination rollout concludes in late October.

The government has not ­released how much it expects to spend on the subsidised flights or the cost of retention payments for international flight staff, which will support wages and retraining. The tourism and aviation recovery package is expected to fall short of industry expectations, given the tourism sector last month demanded nearly $8bn in wage-subsidy payments for more than 100,000 of the worst-affected businesses when JobKeeper ends.

Restaurant and Catering Australia has also called for ­“HospoKeeper” to replace JobKeeper for six months from April, with $1000 payments a fortnight for full-time staff and $650 for employees working fewer than 20 hours per week.

The Prime Minister said the mix of half-price airline tickets, keeping planes in the air and government-guaranteed loans for businesses would act as a bridge to “a more normal way of life”.

“This is our ticket to recovery — 800,000 half-price airfares to get Australians travelling and ­supporting tourism operators, businesses, travel agents and airlines who continue to do it tough through COVID-19, while our international borders remain closed,” Mr Morrison said.

“This package will take more tourists to our hotels and cafes, taking tours and exploring our backyard. That means more jobs and investment for the tourism and aviation sectors as Australia heads towards winning our fight against COVID-19 and the ­restrictions that have hurt so many businesses.”

Mr Morrison, who will ­announce the post-JobKeeper measures in Sydney, said: “Our tourism businesses don’t want to rely on government support ­forever … they want their tourists back.”

The Australian understands the May 11 budget will feature ­additional post-JobKeeper measures, including targeted regional funding packages and extra support for sectors hit by international border closures.

The stimulus package, which takes COVID-19 economic support for the aviation and tourism sectors to almost $5bn, will extend shortfall subsidies supporting key domestic air travel and freight routes until September 30.

 

Subsidised flights provided under the Tourism Aviation ­Network Support scheme will run between April 1 and July 31, and will be accessed directly through airline websites.

More planes will be activated to service demand, with return flights covered by the 50 per cent discount. The government ­expects to support 46,000 discounted fares a week.

Josh Frydenberg said the expansion of the government’s SME Loan Guarantee scheme, ­supporting up to $40bn in lending to businesses, would help employers get back on their feet.

More than 35,000 loans valued at a combined $3bn have been provided under the existing scheme, which will be adapted to directly support businesses still ­reliant on JobKeeper payments.

The government guarantee will increase from the current 50-50 split with the banks to an 80-20 split. The change is intended to encourage lenders to ramp up support for small businesses.

The size of eligible loans, for businesses on JobKeeper between January 4 and March 28, will be increased from $1m to $5m. Companies with higher turnovers will also be captured under the new scheme, with the threshold increasing from $50m to $250m.

Repayment holidays of up to 24 months, on principal-and-­interest loans, will be offered to eligible businesses. Borrowers can also use the scheme to refinance existing loans and access concessional interest rates.

The Treasurer said more than 350,000 current JobKeeper recipients were expected to be eligible under the expanded scheme, with loans available from April 1 to December 31.

“This SME Recovery scheme is part of the next step in our plan to help small businesses stand on their own two feet as the economy recovers from COVID-19,” Mr Frydenberg said.

“The expansion and extension of the loans will back businesses that back themselves and will help businesses who continue to do it tough build a bridge to the other side of the crisis and keep their staff employed.”

Tourism Minister Dan Tehan said the cut-price airfares would encourage Australians to “do their patriotic duty and book a holiday this year”.

Domestic tourism businesses, which pump more than $100bn into the economy and employ about 611,000 people, continue to rely heavily on JobKeeper ­payments in some regions along with cafes, restaurants, travel agencies and accommodation providers.

“Every dollar spent on an ­Australian holiday is a dollar that supports a local job and a local business,” Mr Tehan said.

The government is also ­extending the domestic and ­regional aviation network ­programs, the subsidised international flights helping to shift exports into overseas markets, support for zoos and aquariums, and the waiving of air services and airport security fees.

Transport Minister Michael McCormack said the subsidised airfares would give “Australians clear incentives to travel to key domestic tourism areas”.

“Discounts will be offered on tens of thousands of fares per week across an initial 13 key ­tourism regions,” the Nationals leader said.

Mr McCormack said: “We’re working with airlines to increase the number of flights to these tourism areas.

“We’re also backing the ­workforces of our international airlines and the teams and infrastructure they need so that when tourism takes off again and our borders reopen, our airlines are ready to go.”

Australian Chamber of Commerce and Industry tourism chief John Hart said the “most ­important thing is getting tourists back and that means keeping up with the vaccine rollout, keeping domestic borders open and ­staging the reopening of the international border”.

Queensland Premier Annastacia Palaszczuk on Sunday ­announced the state Labor government would offer 15,000 ­travellers $200 vouchers to spend on holidays in the Cairns and Great Barrier Reef regions between March 15 and June 25 via a lottery, which finishes on ­Thursday.

ADDITIONAL REPORTING: ROSIE LEWIS