PM to announce rescue package for the international travel industry with interest-free loans

PM-Scott-Morrison

Prime Minister Scott Morrison. Source: AAP/Lukas Coch.

Prime Minister Scott Morrison is set to announce targeted support for the international tourism and aviation sectors ahead of the end of JobKeeper this month.

In a speech delivered on Tuesday morning, Morrison told the Australian Financial Review Business Summit that support for specific industries would be one part of a broader plan to grow the economy as it emerges from its “emergency phase”.

Along with support for industries post-JobKeeper, Morrison said there will be new initiatives to help address the issues arising from the lack of temporary migrant workers in the country.

“Building the scale, capacity and skills of our workforce is the single greatest economic challenge we face,” Morrison said, according to The Australian Financial Review.

“We must re-look at the role that temporary visa holders play in meeting our economy’s workforce requirements, where Australians do not fill these jobs.”

Support will be targeted at industries still affected by the travel ban including international tourism, aviation and travel. This will involve initiatives to encourage domestic travel within the country and interest-free business loans. However, the details of the loans and domestic travel incentives are yet to be confirmed.

The imminent announcement of a rescue package for the international tourism sector comes after persistent calls from the Tourism and Transport Forum (TTF) for an industry-specific support package.

Research released on Monday by TTF shows that more than 34% of Australia suffered a 40% or more drop in visitors up to September, compared to the previous year. TTF chief executive Margy Osmond said the research reveals that almost every corner of the country is still “reeling from the pain of this sharp and sustained visitor drop-off”.

Osmond has discussed ongoing support for the industry with Treasurer Josh Frydenberg and Minister for Trade, Tourism and Investment Dan Tehan. “[I’m] confident that our concerns and potential support options are being closely considered,” she said.

The latest GDP data show the economy is improving with growth for the December quarter up 3.1%, after the September quarter grew 3.4%. The figures demonstrate the economy shrank by just 1.1% in 2020.

Despite such growth, business groups are concerned that the economic recovery is uneven, leaving behind businesses impacted by international travel, state public health restrictions and working from home trends.

Jenny Lambert, acting chief executive of the Australian Chamber of Commerce and Industry, said these industries will certainly need further support after JobKeeper winds up on March 28.

“Immediate direct cash support to this cohort of businesses is vital if they are to be preserved for the pending recovery,” Lambert said.

She added that effective stimulus measures include tax rebates; short-term exemptions from fringe benefit tax rules for accommodation, air and land transport; and vouchers for CBD dining, accommodation and attractions in affected areas.

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