Chief Minister Andrew Barr says the government will need to go bigger. Photo: Michelle Kroll, Region Media.
The Reserve Bank of Australia will ensure the ACT Government has enough money to deliver its various stimulus packages to protect the economy from the ravages of the coronavirus pandemic by taking action to support credit markets.
Chief Minister Andrew Barr said the Reserve would provide certainty through the purchase of government bonds in the secondary market, ensuring governments across Australia could continue to borrow at low-interest rates.
Mr Barr said the Reserve’s actions would mean the Government would be able to deliver the services and programs that it needed to in the short and long term, as well as help the commercial banks provide support for small businesses and people with mortgages.
“They will be buying ACT Government bonds through secondary markets which give us the certainty we’ll have the actual cash to be able to deliver the services that we need to over the coming months,” he said.
It also meant the government would be able to seek cheap loans in the marketplace over the longer term.
“We will be able to get a line of credit for the ACT Government, and the RBA will be providing funding certainty at the lowest possible interest rate for a number of years now,” he said.
“That was important for us because cash flow is going to be a problem for governments as well, and this is where the Reserve Bank steps in and does what it’s meant to do in a time of national crisis.”
Mr Barr was speaking after announcing the ACT’s first stimulus package and a National Cabinet hook-up, immediately flagging further measures as part of four-phased program.
He said the government would need to go bigger on some of the announced initiatives and extend them, and pointed to supports for both commercial and private tenants.
”This is not the last lever we will pull,” he said.
“We will be issuing further rounds of both economic rescue, recovery and ultimately stimulus at appropriate times over coming months.”
Mr Barr said there would be “quite significant” further public health driven changes that would have more economic impacts needing to be cushioned.
He later announced the ACT budget would be postponed after Prime Minister Scott Morrison said that the Federal Budget would be pushed back to October.
Mr Barr said that in the unfolding economic circumstances both commercial and private landlords would need to provide rent relief to their tenants.
“They’re going to have to give rent relief to their tenants, those conversations are taking place now at the national level with many of the large retail institutions, Westfields and the like,” he said.
“It’s going to have to extend to smaller landlords. They’ll find that if they let tenants go, if they foreclose, they will get no other tenants, and they’ll get no income, and there will be no businesses operating out of their premises.”
Mr Barr pleaded with landlords not to evict people from their homes or businesses, and urged them to offer rent-free periods if necessary to help people through this situation.
“This is about protecting what we have now, getting them through this next period, and the supports that are going to be coming into place from the ACT Government and the Federal Government ought to assist people in managing this period,” he said.
“If you’re a landlord and think you’re just going to be able to go on making the same level of profit you were before this you are going to have to think again.”
Mr Barr said there would be more announcements and interventions that no government would have previously contemplated.
“These are extraordinary times and they require extraordinary measures,” he said.
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