Australia’s Stimulus funds ’should flow into economy quickly’

Economists say the early impact of the Federal Government’s $42 billion stimulus package will be noticed when the payments flow from next month.

The stimulus plan made it through the Senate yesterday after a week of wrangling in Federal Parliament.

 

The cash handouts will start to roll from next month, beginning with the single income and back to school bonuses from March 11.

Farmers and students get their money from February 24 and then the tax bonus of up to $900 will be paid in April.

Forecaster Chris Richardson from Access Economics says judging the success of the spending will be difficult, but he expects the money to be pumped into the economy quickly.

“We will never know how well this package did or didn’t do,” he said.

But he has crunched the numbers and he says not all of the money will be returned to the economy, but it will be a better result than similar moves overseas.

“[With] the US package, only between 12 and 20 cents in the dollar of that will be timely, temporary and targeted,” he said.

“In Australia, our package is about 54 cents.”