Austria is more than doubling the funds it set aside to subsidize salary payments to 1 billion euros ($1.1 billion) and is bringing in the country’s lenders to help companies over next week’s payday as part of an effort to limit the economic fallout from the coronavirus, Finance Minister Gernot Bluemel said.
The program is designed to avoid redundancies by paying most of a worker’s salary if companies keep employees on their payroll even if there’s nothing to do because of the coronavirus shutdown. To avoid liquidity squeezes while applications for the subsidies are processed, Austria’s banking sector agreed to provide bridge financing for companies participating in the program, Bluemel said.
Companies including builder Strabag SE, steelmaker Voestalpine AG and Austrian Airlines AG have already applied for the program, for which the government initially earmarked 400 million euros. Unemployment is soaring nevertheless, with more than 170,000 jobless applications since the coronavirus lockdown measures started two weeks ago.
©2020 Bloomberg L.P.