Economic Stimulus Package

Source: perthnow.com.au

October 14, 2008 09:38am

GRANTS of up to $21,000 for first home buyers and payments of $1000 for nearly 4 million children were announced by Prime Minister Kevin Rudd today.

The federal government has announced a $10.4 billion package to help Australia counter the global economic crisis.

Pensioners, low and middle income families, and first home buyers will be among the major beneficiaries.

Mr Rudd and Treasurer Wayne Swan unveiled the package in Canberra today.

Mr Rudd said the Economic Security Strategy would strengthen the Australian economy ``in the face of the worst global financial crisis since the Great Depression.''

The strategy includes five key measures, Mr Rudd said.

- $4.8 billion for an immediate down payment on long term pension reform;

- $3.9 billion in support payments for low and middle income families;

- $1.5 billion investment to help first home buyers buy a home;

- $187 million to create 56,000 new training places in 2008-09;

- Accelerate the implementation of the government's three nation building funds and bring forward the commencement of investment in nation building projects to 2009.

Australia's four million pensioners, carers, and seniors will benefit from December 8.

Single pensioners will receive a lump sum payment of $1,400 while pensioner couples will receive $2,100.

People receiving the carers allowance will also receive $1,000 for each eligible person in their care.

Mr Rudd said it was time for fast, decisive action.

``The global financial crisis has entered into a new, dangerous, and damaging phase,'' he told reporters in Canberra.

``That's why the government has decided to act decisively and early on the question of this economic security strategy for the future.

''(It's) decisive action, responsible action, early action, all in Australia's interests.''

Mr Rudd said the package would support growth in the domestic economy and provide practical support for households.

The government said about 3.9 million Australian children will receive a $1,000 one-off benefit from December 8.

Families who receive Family Tax Benefit (A), families with children who receive the Youth Allowance, Abstudy or a benefit from the Veteran Children's Education scheme will be eligible.

First home buyers will be eligible for grants of up to $21,000 designed to stimulate housing activity.

The scheme will be time limited. All contracts entered into by June 30 next year will be eligible for the new assistance.

The payment under the first home buyers scheme will be doubled from $7,000 to $14,000 and first home buyers who buy newly constructed home will receive an extra $14,000 taking their total grant to $21,000.

The government will invest about $1.5 billion in the housing market over 2008/09 and 2009/10 through this initiative.

Mr Rudd said the $10.4 billion strategy would be entirely funded from the budget and Treasury had advised that the budget continue to be in surplus after the measures are introduced.

The government will publish a full budget update in the Mid-Year Economic and Fiscal Outlook within a month.