Treasurer Jim Chalmers has delivered a historic federal budget, forecasting a surplus this financial year – the first time the budget will be in the black in 15 years. Achieving this amid stubbornly high inflation, and as economic headwinds continue to emerge, is no mean feat. It’s also a significant moment for Labor, which last delivered a surplus in 1989 under Treasurer Paul Keating.
Unsurprisingly, tackling cost of living pressures was the main focus, with a modest rise in JobSeeker payments, energy bill relief and a tripling of the Medicare bulk billing rebate headlining the hip pocket measures. The budget also makes a material impact on Australia’s growing inequality by focussing attention on vulnerable communities.
But does it deliver on the biggest issues facing Sydney, such as housing unaffordability or our growing infrastructure needs?
While the budget addresses those big issues in various ways, many of the announcements lacked the ambition or detail we hoped for.
It maintains the current $120 billion infrastructure program, for now. The final call on the 800 projects in the pipeline will be made once the government’s 90-day review is complete.
On housing, there was a welcome, but modest, increase to rental assistance, along with changes to support build-to-rent, but no significant moves on boosting housing supply or tackling investment tax incentives that continue to inflate house prices.
Dr Chalmers’ caution may be understandable, given the economic uncertainties our nation faces and current inflationary pressures, but for Sydney to emerge out of the pandemic as a true global powerhouse, we must continue to think big and show ambition. We look forward to working with the Commonwealth on realising that ambition.
For now, here are the Sydney highlights of Tuesday’s budget:
- $23m for the creation of a net zero authority aimed at filling the economic hole left by the closure of fossil fuel mines and power stations. The federal body would complement NSW’s own transition body.
- Once legislated, the authority would aim to help workers retrain to find new jobs, coordinate programs across government and encourage investment in low-carbon industries to generate new employment.
- There will also be $400m from the Powering the Regions Fund to be administered by the Australian Renewable Energy Agency.
Household energy transition
- $1 billion in new funding for the Clean Energy Finance Corporation to offer solar, storage and electric upgrade finance to more than 170,000 homes.
- $300 million for electrification and energy performance upgrades for social housing, in partnership with states and territories.
- $36 million over four years to expand and modernise the Greenhouse and Energy Minimum Standards program and the Nationwide House Energy Rating scheme (NatHERS).
- A national messaging system will be operational by 2024 to help Australians living in areas impacted by natural disasters.
- $10.1m will be spent to set up a new broadband system that will help all emergency services agencies across jurisdictions communicate more effectively.
- $4.4m will go to 83 emergency and flood relief providers across Queensland and WA.
- $28 million for Australia’s first National Climate Risk Assessment and a National Adaptation Plan.
- $214 million for a ‘Nature Positive Plan’.
- $8.3 million over four years to develop and issue sovereign green bonds.
Cost of living
- JobSeeker unemployment benefit will increase by $40 a fortnight for all recipients from 20 September 2023.
- State and federal funding for up to $500 in one-off energy bill discounts for low-income households (pensioners and those on income support) and small businesses.
- Single-parent payment cut-off age will be extended from when a child is eight to when they are 14 – meaning single parents will get an additional six years on the payment before being moved to the lower JobSeeker payment.
- Child Care Subsidy rates lifted to 90% for families on a combined income of $80,000 or less.
- $18 million to establish new early childhood education and care facilities in childcare deserts.
Mobility, infrastructure and cities
- $687 million over six years for a ‘national approach to sustainable urban development.’ This includes funding for ‘place-based priorities of local urban communities’ and the establishment of a new Cities and Suburbs Unit. As part of this, there will be two key grant programs – Thriving Suburbs and Urban Precincts and Partnerships.
- $146.1 million to support electric vehicle uptake, including funding for EV charging infrastructure.
- $45 million for repairs to sites managed by the Sydney Harbour Federation Trust.
- The withholding tax rate will be halved from 30% to 15% for managed investment trusts with foreign investors when they invest in build-to-rent properties after July 2024.
Culture and the arts
- $535 million for urgent upgrades to national cultural institutions, including $23 million for the Sydney-based Australian National Maritime Museum.
- $286 million to restore core arts funding, establish Creative Australia, Music Australia, Writers Australia and a Creative Workplaces centre to support arts workers, establish a First Nations-led body dedicated to First Nations work, and improve incomes for authors.
- $112.3 million to attract international investment in the Australian screen industry, increasing the Location Offset rebate to 30%.
- $9 million in 2023-24 to Australia’s eight national arts training organisations (including NSW-based AFTRS, NIDA and NAISDA) to maintain Australian trained in-demand performers and production specialists for the live performing arts and screen industry and creative economy.
- $6.9 million over four years from 2023-24 for Ausfilm to promote screen productions in Australia.