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Trade and assistance review 2019-20 1.54 MB

This report delivers the Productivity Commission’s estimates of assistance provided to businesses for the year to June 2020. The review is set against a background of unprecedented industry assistance to counter the economic impacts of the COVID-19 pandemic, although most of this assistance has been provided in 2020–21.

Key points:

  • There was a small increase in assistance provided to industry by the Australian Government in 2019-20 compared to the previous financial year. However, effective rates of assistance (ERAs) for most industries remain at, or near, historic lows.
  • In gross terms, industry and sectorial assistance totalled about $13.7 billion in 2019-20. Of this: $1.8 billion was in the form of tariffs; $5.1 billion was in the form of budgetary outlays; and $6.7 billion was in the form of tax concessions.
  • The services sector received the most assistance in absolute terms but a disproportionately small amount of assistance relative to the sector’s value added. While assistance to the primary production and manufacturing sectors is at or near historic lows, these two sectors continued to receive a disproportionately large share of assistance given their value added.
  • Assistance varied widely at the industry level. For example, the motor vehicles and parts and textiles, clothing and footwear industries had ERAs that remain significantly above other industries in the manufacturing sector. Variation in ERAs was even more pronounced across industries in the agricultural sector.
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