Tonight the Morrison Government has delivered one of the most important Federal Budgets in our history, focusing on supporting businesses and communities as we move into the next phase of Australia’s economic recovery plan and our path forward.
In his third Budget address, Treasurer Josh Frydenberg has focused on continued COVID-19 measures to support all Australians through infrastructure investment, essentials services, skills development, extensions to tax relief initiatives, and boosting the digital economy, with the aim to continue to grow jobs. We welcome the broad focus on renewable energy and hydrogen development across the nation, and look forward to Townsville and North Queensland playing a bigger role in this space.
It's encouraging that the initial 2021 Budget deficit of $213.7B forecast in the 6 October 2020 Budget has dropped to a deficit of $161B ($57B lower than expected). The Treasurer said that this result is off the back of strong jobs growth, a drop in JobSeeker payment recipients and a lift in company profit tax. Additionally, commodity prices are booming higher than earlier predicted, boosting tax revenue for the Commonwealth.
It's pleasing that a key priority in our Unlock the North Federal Government Budget Submission, developed with Townsville, Burdekin, Charters Towers, Hinchinbrook, and Palm Island councils, has been firmed up in this Budget with the confirmation of the Reinsurance Pool for the North as well as the additional $189.6M in funding towards the development of Northern Australia.
The ongoing engagement with Member for Herbert Phil Thompson, Senator Susan McDonald, Member for Dawson George Christensen, and Member for Kennedy Bob Katter has also been critical in ensuring the North remains front of mind in Canberra and we acknowledge our region's Federal representatives for their advocacy.
We thank the Federal Government for providing businesses and households invaluable support to weather the pandemic over the past 12 months but now is the time to act on Northern Australia’s potential and convert the visions in this Budget into real investment and jobs.
We know a Strong North is a Strong Nation and by leveraging our region's strengths and economic diversity across mining, agriculture, Defence, education, health, natural resources, and tourism assets, we have the potential to stimulate economic recovery and growth not just for North Queensland but the nation.
We will continue to review tonight's announcements and unpack the Budget in full over the coming days to ensure our Members and the Townsville North Queensland region have a clear understanding of the roadmap for them, their family, and their business over the next 12 months.
Summary of Key 2021 Federal Budget announcements:
- Budget deficit of $161B for 2021, falling to $57B in 2024-25
- Employment back to pre-pandemic levels, with unemployment at 5.6%
- Net debt will increase to $617.5B or 30% of GDP this year and peak at $980.6B or 40.9% of GDP in June 2025
OUR NORTH OUR FUTURE
$189.6 million over five years from 2021-22 for a package of measures to support the Next Five Year Plan for Northern Australia. Building on the Northern Australia White Paper, Our North, Our Future is the Government's next five-year strategic plan aimed at stimulating economic recovery and creating jobs across northern Australia. Funding includes:
- $111.9 million over five years from 2021-22 to establish a Northern Australia Development Program to support businesses to scale-up projects into commercial outcomes by providing co-investment funding and an advisory service
- $68.5 million over two years from 2021-22 to deliver targeted digital connectivity solutions in Northern Australia through dedicated funding under the Regional Connectivity Program and the Mobile Black Spot Program
- $9.3 million over five years from 2021-22 to implement and evaluate a pilot Regions of Growth program to provide on-ground resources in four geographic regions in Northern Australia to focus investment, job creation and business growth.
INFRASTRUCTURE
Additional $15.2 billion spent on new infrastructure projects
- $400M for the Inland Freight Route (Mungindi to Charters Towers) Upgrades
- $18.4M Flinders Highway overtaking lanes between Townsville and Charters Towers and $7.8m for wide centre line treatment on the same stretch of Highway
- $400M for Bruce Highway Additional Funding
REGIONS
$250M Building Better Regions Funding towards regional infrastructure projects.
NATURAL DISASTERS
$600M National Recovery and Resilience Agency - Immediate funding will support resilience projects across the community and for individuals’ homes, such as bushfire and cyclone proofing houses, building levees and improving the resilience of telecommunications and essential supplies.
TOURISM
- Provide $14.1M over three years from 2021-22 to the Great Barrier Reef Marine Park Authority to support tourism and to conduct a review of the Authority's current charging structure.
- The Government will provide further support to employers in the tourism and hospitality sectors to help them find workers, by temporarily allowing student visa holders to work more than 40 hours per fortnight, as long as they are employed in the tourism or hospitality sectors. This measure builds on previous changes, in response to COVID-19, which allowed international students working in critical sectors, such as agriculture, health and aged care, to work more than 40 hours per fortnight.
- Extend the $94.6M Supporting Australia's Exhibiting Zoos and Aquariums program
- 800,00 half price airfares
INSURANCE
- $10B Reinsurance Pool (read our Advocacy Alert HERE).
- $40.3M over three years from 2021-22 for a pilot program (implemented with the Queensland Government) to fund cyclone risk mitigation works for strata title properties in North Queensland.
TAX RELIEF
- Low and middle-income tax offset - The offset is worth up to $1080 for singles or $2160 for couples as a refund for approximately 10 million workers.
- Extension of instant asset write until 30 June 2023.
- Extension of small business loan scheme.
SUPERANNUATION
- Will remove the current $450 per month minimum income threshold for the superannuation guarantee to improve economic security in retirement for around 200,000 women.
- No longer require older Australians to meet a work test before they can make voluntary contributions to superannuation.
- Allow those aged over 60 to contribute up to $300,000 into their superannuation if they downsize their home.
- Enhance the Pension Loan Scheme by providing immediate access to lump sums of around $12,000 for singles, and $18,000 for couples.
HYDROGEN & ENERGY
A further $1.6B to fund priority technologies, including clean hydrogen and energy storage.
MANUFACTURING
A new ‘patent box’ starting on 1 July next year. Under the patent box, income earned from new patents that have been developed in Australia will be taxed at a concessional 17% - almost half the rate that applies to large companies. The patent box will apply to the medical and biotech sectors and the Government will consult on expanding it to the clean energy sector.
DEFENCE
$1.9B over the decade to strengthen national security, law enforcement and intelligence agencies.
HEALTH
- A further $1.9B allocated for the roll out of vaccines.
- $1.5B for COVID‑related health services, including for testing and tracing, respiratory clinics and telehealth.
- National Disability Insurance Scheme - Additional $13.2B over four years to increase Commonwealth contribution to participant support costs.
- Aged Care - $17.7B for increased workforce wages and training.
- Mental Health - $2.3B for suicide prevention and crisis services.
CHILDCARE
- A further $1.7B measure to reduce childcare bills from July 2022 for low and middle income families (average saving of $2,200/year).
- Families with one child in care will have 95% of their out-of-pocket expenses for any additional child paid for by the Government.
- The cap of $10,560 on childcare subsidies will also drop.
AGRICULTURE & WATER
- Funding from the $3.5B National Water Grid Fund to make regional Australia more resilient to drought, building dams and irrigation projects.
- $87.7M in funding for the Agri‑Business Expansion Initiative to help small businesses and farmers expand and diversify their export markets.
- $5M in 2021-22 for grants to primary producers in Queensland affected by Tropical Cyclone Niran in February and March 2021.
EDUCATION
$19B towards universities in 2021/22
SKILLS & TRAINING
- $2.7B JobTrainer Program extension - Providing free short courses for those aged 17 to 24 (170,000 new apprenticeships and traineeships).
- 5000 new places for women in non-traditional trades and STEM scholarships.
DIGITAL CONNECTIVITY
$1.2B Digital Economy Strategy
- $53.8M National Artificial Intelligence Centre managed by CSIRO to harness the power of machines to transform manufacturing, agriculture, science, Defence and more.
HOUSING
- First Home Buyers Scheme - Up to 10,000 new places for first home owners to either buy or build a new home with a 5% deposit.
- Revised First Home Super Save Scheme - Increase from $30K to $50K of voluntary contributions to purchase a home so long as buyers live in the house.
- Family Home Guarantee Package - Single parents with a household income of less than $125K would only need a 2% deposit to get into the housing market.
CLICK HERE FOR MORE INFORMATION ON THE 2021/22 FEDERAL BUDGET
