Australia launches $470 million stimulus package for construction sector

Australia launches $470 million stimulus package for construction sector

2/2 © Reuters. FILE PHOTO: A tradesman uses a nail gun on the framework of a new house on the outskirts of Melbourne 2/2

By Colin Packham

SYDNEY (Reuters) – Australia will give eligible residents A$25,000 ($17,323) to build or significantly renovate their homes, Prime Minister Scott Morrison said on Thursday, as Canberra moves to revive a construction sector badly affected by the coronavirus pandemic.

Dubbed HomeBuilder, the package worth A$680 million ($471 million) is Australia’s fourth economic stimulus package as it seeks to repair an economy that is now in its first recession in 29 years.

Morrison said the package would support jobs and allow people to build a family home, a long-held dream for many Australians.

“We are going to keep that dream alive for them and the dreams alive of the jobs and the builders and apprentices and tradies (tradespeople), all of those who depend on this critical industry across the country,” Morrison told reporters in Canberra.

In 2019, around 1.15 million people were employed in construction, about 9% of the country’s workforce, government data shows.

The scheme though is heavily restricted.

Applicants will have to earn less than A$125,000 if they are single and A$200,000 if they are a couple, with limits on house values and recipients required to spend at least A$150,000 before being eligible.

Still, the government expects 27,000 applications and support the employment of 14,000 construction workers.

“The package will see slabs poured in the second half of the year, meaning jobs are kept and houses built,” said Graham (NYSE:) Wolfe, managing director of the industry group, Housing Industry Association.

The latest stimulus package comes as COVID-19 cases slow to fewer than 20 a day.

Australia has not reported a death from the disease for more than a week. It has recorded 102 COVID-19 deaths and almost 7,200 infections.

($1 = 1.4432 Australian dollars)

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