With $220 billion in loans now deferred, banks reportedly going easy on debt covenants and insolvencies well below average, Prime Minister Scott Morrison has offered words of encouragement to the business community today.
As restrictions start to be eased between now and Monday for the majority of the population, the PM acknowledges limits of up to 10 people at a time in hospitality venues "won't necessarily be a profitable patronage" for many businesses.
But in reopening, these cafés and restaurants are "backing their staff".
"They're backing their communities and they're backing their country, and I want to commend them for that brave step that they're taking this weekend," he told a press conference today after the National Cabinet meeting, noting it has now been two months since its first meeting to address the crisis.
"Good on you for reopening, and I'm sure your patrons will come in and support you strongly as well."
He emphasises the banking sector has held up well, and the oversubscribed take-up of bonds show that markets are treating Australia as a country to be relied upon - "a good bet".
"It's essential that as we move forward that we continue to enable the credit to flow through our banking system to support those businesses who are taking decisions to reopen, to rehire, and to move ahead," he says.
"Some $220 billion in loan deferrals have already been put in place in our banking system - about two-thirds of that in mortgages and one-third for small and medium sized enterprises.
"The banks have also not been enforcing, broadly speaking, covenants, and they've been holding off on revaluations and not pursuing recovery actions other than for pre-existing cases."
He notes insolvencies are currently running below average, and that's been backed by significant protections put in place early on in the crisis in relation to preventing creditors from forcing companies into liquidation.
"In addition, the super (superannuation) system - we are advised - is responding very well with some $11.7 billion in claims. It was noted that this was consistent with the Treasury estimate, and this was not presenting liquidity issues, the head of APRA (Australian Prudential Regulation Authority) has advised us," he says.
"Industry estimates of what the claims would be have not been realised."
Could net import gap favour domestic tourism?
While the tourism industry has been one of the hardest hit by the COVID-19 pandemic and related lockdowns. Morrison has pointed out a potential silver lining.
"As the borders fall internally and Australians can hopefully soon return to domestic holidays and to move around the country more widely - and particularly with school holidays coming up again in July - we were reminded that the net tourism imports to Australia is [sic] just over $20 billion a year," he says.
"That means that after you take account of international tourists coming here and Australians going overseas, that there is a net import factor of just over $20 billion.
"Now that's up for grabs for Australian domestic tourism operators - Australians who might otherwise go elsewhere, that is a very large market and that will be targeted."
The Federal Government has been working with state and territory agencies responsible for tourism, and Tourism Australia is set to launch its 'Live from AUS' domestic campaign this evening.
On the topic of travellers, Chief Medical Officer Brendan Murphy says "you can't test your way out of quarantine", noting there had been misinformation circulating that a negative test meant people could avoid these measures.
"We also had a discussion about quarantine periods for returning travellers. I want to make it very clear that there is no no amount of PCR testing or swab testing that can that can obviate the need for quarantine," he says.
"If you are a return traveler from a risk area and a quarantine requirement is in place, having a test done - a swab and a PCR done - just means whether you are positive on that day; it doesn't mean that you're not incubating the virus and it doesn't mean you can get out of quarantine earlier."
With the total number of COVID-19 cases now at 7,017, there are only 50 COVID-19-related patients in hospitals now of whom only 12 people are on ventilators.
"Hospital capacity is around 50 to 60 per cent. We are starting see some increase with the elective surgery relaxations announced a few weeks ago, but there is now pretty good room for further expansion and clearly in those states that are having essentially no cases they want to go fairly quickly back to full elective activity," he says.
"Those states that still have some transmission are probably going to take it a bit more gently, but everybody is now heading towards full elective surgery, which is a really important thing."
An extra $48 million pledged to fill gaps in mental health services
The Federal Government will invest an extra $48 million into mental health services to combat the psychological damage wrought by the COVID-19 pandemic on Australians.
According to Federal Health Minister Greg Hunt the extra funding will seek to plug holes identified by the Government in Australia's mental health system.
The funding will cover three areas:
- $7.3 million will go toward research and data so the Government can identify problems in real time.
- $29.5 million will go toward outreach programs for vulnerable communities like non-English speaking communities, Indigenous Australians and those with pre-existing mental health conditions.
- $11.3 million will form a broader communication campaign, of which $10.4 million will form a national campaign that will tell Australians "It is okay to not be okay".
The program comes as over 957,000 mental health services have been delivered in the last four weeks, bringing the rate back up to pre-COVID-19 levels, with half of these consultations being conducted via telehealth.
Despite the good work done so far, National Mental Health Commission CEO Christine Morgan says the Government can do more.
"We understand the social context in which we exist, and we're also seeing another really encouraging thing, and that is moving into delivering mental health care in community. But there are gaps," says Morgan.
"And the gaps are what we seek to address with this plan. The first gapis data. We absolutely must come together as a country and see what we can actually do to improve that data collection, so that we know not only what is happening, but we can better understand what to expect, and we can better move to services where they are needed. That is critical.
"The second is we have had people disconnect from services. You've heard me say that before. And we have had people really challenged with accessing services. So, the plan says, 'We must reach into community'. That means we need to be where people can access services."
The funds for the program are being invested by both the Federal and state governments. Victoria has already pledged to contribute $19.5 million and other states are also expected to contribute.
The extra $48 million is on top of the $4.2 billion investment already made by the Federal Government made more broadly into the health sector.
Updated at 2:08pm AEST on 15 May 2020.
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