Treasurer Josh Frydenberg described the coronavirus as a "Team Australia moment".Credit:Alex Ellinghausen
Legislation to authorise the extra spending was set to pass both houses of Parliament on Monday,with an annual discretionary fund of $1.2 billion controlled by Finance Minister Mathias Cormann boosted to $40 billion.
Parliament is now scheduled to return in August,after a scaled-back session on Monday to pass supply bills and the legislation needed for a $17.6 billion stimulus package and $66 billion of small business and income support measures.
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Government sources said the discretionary fund was initially expected to be $22 billion but was increased to $40 billion following negotiations with Labor,which secured safeguards and assurances from the government as to how the money would be spent.
The fund will be used to support state and local governments with extra health costs and the potential for more direct assistance for sacked workers and struggling businesses.
The government is also expecting to increase spending on importing emergency supplies at a higher price because of soaring international demand.
Federal Health Minister Greg Hunt told Parliament on Monday a shipment of masks headed for Australia had been diverted to another country,while Australian company ResMed,which makes sleep apnoea machines,had been asked by the government to make 1000 ventilators.