US Congress extends relief programme for businesses

WASHINGTON (AP) — The House in the United States (US) on Wednesday easily passed a temporary extension of a subsidy programme for small businesses slammed by the coronavirus, speeding the measure to President Donald Trump.

Approval by voice vote without debate came after Democrats pushed the legislation through the GOP-controlled Senate late on Tuesday as spikes in coronavirus cases in many states led to renewed shutdowns of businesses.

Trump was expected to sign the measure.

The legislation extended the June 30 deadline for applying for the programme to August 8. Lawmakers created the programme in March and have modified it twice since, adding money on one occasion and more recently permitting more flexible use of the funding despite some grumbling among GOP conservatives.

About USD130 billion of USD660 billion approved for the programme remains eligible for businesses to seek direct federal subsidies for payroll and other costs such as rent, though demand for the Paycheck Protection Programme has pretty much dried up in recent weeks.

Federal Reserve Board Chairman Jerome Powell (left) and Treasury Secretary Stephen Mnuchin bump elbows at the conclusion of a House Committee on Financial Services hearing in Washington. PHOTO: AP

Sponsors of the programme, including Treasury Secretary Steven Mnuchin and Senate Small Business Committee Chairman Marco Rubio, want to re-purpose the money in a way that’s more targetted for businesses suffering during the upswing in cases.

It was part of an almost USD3 trillion federal response to a menacing virus that slammed the economy as consumers and workers were forced to stay at home through much of spring.

The subsidies come in the form of federal loans that can be forgiven if businesses follow rules such as utilising 60 per cent of the loan for payroll costs. The loans have been a lifeline to almost five million firms, but business owners are looking for more flexibility and aid that helps them survive over the long haul.

Congressional action came as lawmakers were set to exit Washington for more than two weeks. Upon their return, talks were expected to begin on a fifth coronavirus relief measure.