The federal budget: What we know so far
FEDERAL BUDGET – WHAT WE KNOW SO FAR:
THE BIG PICTURE
* With the COVID-19 pandemic, flooding and Ukraine-Russia war creating headwinds, Treasurer Josh Frydenberg is emphasising the “fiscal dividend of a stronger economy”.
* Budget deficit estimated to be around $70 billion, instead of the $98.9 billion estimated in the mid-year budget review in December 2021
* Debt is edging towards $1 trillion, but budget papers will show it stabilising before declining in the medium term based on continuing economic growth
* Unemployment on four per cent (February official figure)
* Budget papers will give a conservative estimate of revenue from minerals such as coal and iron ore, despite them earning record prices
THE GOVERNMENT’S PLAN
* Keep in place a tax-to-GDP ratio at or below 23.9 per cent
* Infrastructure investment
* Boosting skills
* Driving new manufacturing
* Energy plan
* Digital economy
* Modest budget repair
* Improving service delivery and funding national security measures
HIP POCKET
* “Targeted and proportionate” cost of living relief, possibly cash payments for low and middle-income earners
* Expected (but not confirmed) to include another 12 months of the low and middle income tax offset
* Bring forward of child care subsidy changes from July 1 to March 7, to cost around $224 million in 2021/22 and $670 million a year ongoing
* Pension and welfare payments rise from March 20, benefiting 4.9 million people and costing the budget $2.2 billion extra over the year
* No bringing forward of high-end income tax cuts
BUSINESS
* $1.85 billion in cash flow support for 2.3 million small businesses by lowering tax instalments in 2022/23
ENVIRONMENT
* $800 million over 10 years for strategic and scientific research and exploration in Antarctica.
* $86 million forestry industry support in Tasmania
* $60 million for recycling modernisation
BIOSECURITY
* National biosecurity strategy
DEFENCE
* $10 billion over two decades set aside for an east coast submarine base in Queensland or NSW
* $4.3 billion to help build a new dry dock facility in Henderson, Western Australia, with construction to start in 2023
* Defence spending expected to be around 2.1 per cent of GDP
* $282 million in the Northern Territory for 34 capability projects and maintenance and servicing work
* Support for Ukraine military forces
INFRASTRUCTURE
* $500 million for Urannah dam in central Queensland
* $678 million for the sealing of 1000km of the Outback Way
* $2.26 billion for Adelaide’s North-South corridor motorway
* $40 million for bridges
* $74 million top-up for Perth city deal
* $668 million for southeast Queensland city deal
* $5.4 billion for Hells Gates dam in north Queensland
WOMEN
* $189 million over five years to strengthen prevention and early-intervention efforts in family, domestic and sexual violence
* $104 million to prevent technology and devices being used to perpetrate or facilitate family, domestic and sexual violence.
RED TAPE
* $128.5 million reform package to provide greater certainty around environmental protection and streamline assessments
* Deregulation using international safety standards to save businesses $136 million a year
* Waiving of fees and taxes for reef-based industries over 2022/23 financial year.
HEALTH
* Medicare to cost around $126 billion over four-year forward estimates
* Four-year rolling funding agreement and annual increases from July 1, 2023, for Aboriginal Community Controlled Health Services
* $61.2 million for the Australian Genomic Cancer Medical Centre to research and develop drugs for people with advanced cancers
* $315 million over four years to extend its national ice drug action strategy
* $700 million for regional health specialist training
EDUCATION/SKILLS
* $6.4 billion for independent schools, growing to $8.5 billion by 2029.
* $1.2 billion over four years for an expanded Transition to Work employment service for disadvantaged youth
* Support for Indigenous boarding students
RESEARCH
* Critical minerals industry to get $200 million Accelerator grants program, $50 million to support research and development and an updated industry strategy.
MANUFACTURING
* $55.4 million for BlueScope Steel’s Advanced Steel Manufacturing Precinct around the Port Kembla steelworks.
Paul Osborne
(Australian Associated Press)