Monday, May 27, 2024

ECONOMY | 21-04-2020 15:16

Government launches aid package, will pay wages for private-sector firms

State to pay half of this month’s wages for all private companies up to 33,750-peso limit, irrespective of size of payroll. Move takes government assistance to 3% of GDP to date.

The government has announced a huge aid package for private companies struggling in the wake of the coronavirus pandemic and subsequent shutdown in economic activity.

Productive Development Minister Matías Kulfas and Labour Minister  Claudio Moroni announced details of the emergency assistance on Monday at a press conference, saying the government would private-sector companies face the impact of the coronavirus epidemic. The move, according to reports, will lift state assistance since the pandemic began to some 850 billion pesos (almost three percent of Gross Domestic Product) overall.

"This is a very strong signal we’re seeking to give so that they can approach the crisis with better perspectives", said Kulfas, adding that "the main objective [of the package] is to save jobs and the national economy, reinforcing the productive fabric for after the pandemic."

He confirmed that half of this month’s wages in all private-sector firms affected by the quarantine would be paid up to a ceiling of two minimum wages (33,750 pesos), irrespective of the size of the company’s payroll, an outlay amounting to some 107 million pesos to be paid via ANSES social security administration funds. The floor of this assistance is to be one minimum wage and the ceiling two.

The package also extends to interest-free credits of up to 150,000 pesos for the self-employed, guaranteed by the Production Ministry and with a six-month grace period – the first assistance to the sector apart from those in the two lowest tax categories. Credit for companies and the self-employed totals 470 of the 850 billion, the government separately informed.

These announcements were made at a Casa Rosada press conference to supply details on an emergency decree already signed by President Alberto Fernández and published in the Official Gazette as an expansion of the government’s Labour and Production Assistance Programme (Asistencia al Trabajo y la Producción, or ATP).

Kulfas revealed that the decree had been preceded by a debate within the Cabinet on the need "to expand and simplify the aid package."

The minister estimated that around “80 percent [of private-sector workers] would be receiving half or more of their April wages” from the state.

“Two-thirds of all private-sector companies, or around 420,000 employers, are registered in the ATP programme,” highlighted Kulfas while adding that the ATP register would be open for 48 hours as from Tuesday for others to enter. But he underlined that the aid would be for all companies affected by the coronavirus pandemic.

Giving specific examples of how the wage assistance would work, the minister explained: "If a company pays an employee 30,000 pesos net, ANS£S will deposit 16,800, if 50,000, 25,000 but if 80,000, not half but the ceiling of 33,750 pesos."

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