COVID-19 has resulted in the most severe global economic crisis since the Great Depression.
Across the world the equivalent of 600 million people have lost their jobs.
The global economy is expected to contract by 4.5% this year compared to just 0.1% during the Global Financial Crisis.
In April, more than one million Australians lost their jobs or saw their working hours reduced to zero.
In the June quarter, Australia’s economy contracted by 7%. This compares to around 12% falls in New Zealand, 14% in France and 20% in the UK.
In response to this crisis, the Morrison McCormack Government has committed unprecedented support to save lives, cushion the blow and help Australians remain in jobs.
JobKeeper is a $101 billion lifeline that is supporting around 3.5 million jobs.
The Cashflow Boost has already provided $28 billion, helping around 800,000 small and medium businesses to stay afloat.
JobSeeker doubled the safety net.
Together, our actions saved 700,000 jobs.
We could do this because we entered this crisis in a position of strength, brought the budget back to balance for the first time in 11 years and maintained our AAA credit rating.
Now, Australia’s economy is fighting back.
More than half of those who lost their jobs are back at work, with 458,000 new jobs created in June, July and August.
However, there remains a monumental task ahead.
This Budget sets out the Morrison McCormack Government’s economic recovery plan.
JOBMAKER HIRING CREDIT
There is no economic recovery without a jobs recovery.
A new JobMaker hiring credit will encourage businesses to hire younger Australians.
The JobMaker hiring credit will be payable for up to twelve months and be immediately available to employers who hire those on JobSeeker aged 16-35.
It will be paid at the rate of $200 per week for those aged under 30, and $100 per week for those aged between 30-35.
New hires must work for at least 20 hours a week.
All businesses, other than the major banks, will be eligible.
Treasury estimates that this will support around 450,000 jobs for young people.
Having a job means more than earning an income.
It means economic security.
It means independence.
It means opportunity.
We can’t let this COVID recession take that away.
INVESTING IN SKILLS AND TRAINING
This Budget is making a record investment in upskilling and reskilling Australians.
The Morrison McCormack Government has already established the $1 billion JobTrainer fund.
The JobTrainer fund will create up to 340,000 free or low cost training places for school leavers and job seekers.
The Government has also committed $2.8 billion to protect 180,000 apprenticeships and trainees.
This Budget commits an additional $1.2 billion to create 100,000 new apprenticeships and traineeships, with a 50% wage subsidy for businesses who employ them.
To help Australians get a job, this Budget is also funding:
- 50,000 new higher education short courses, including in agriculture, health, IT, science and teaching;
- 12,000 new Commonwealth supported places for higher education in 2021
- 2,000 indigenous students through the Clontarf Foundation to complete Year 12 and pursue further education or find employment.
The Government is also investing in regions across Australia to connect job seekers to local employment opportunities.
New cadetships and apprenticeships are being provided for women in science, technology, engineering and mathematics.
The Government is also making changes to our tax system to further encourage businesses and employees to retrain.
TAX RELIEF FOR WORKERS
Last year, the Morrison McCormack Government legislated tax relief so people could keep more of what they earn.
Putting more money into the pockets of hard working Australians strengthened our economy to respond to this economic crisis.
Now the Government is going further, by bringing forward Stage Two of our legislated tax cuts by two years. This means:
- Increasing the low income tax offset from $445 to $700;
- lifting of the 19% threshold from $37,000 to $45,000; and
- lifting the 32.5% threshold from $90,000 to $120,000.
More than 11 million taxpayers will get a tax cut backdated to 1 July this year.
Lower and middle income earners will this year receive tax relief of up to $2,745 for singles, and up to $5,490 for dual income families, compared with 2017-18.
We will also retain the Low and Middle Income Tax Offset for an additional year.
These changes will see more than 7 million Australians receive tax relief of $2,000 or more this year.
As a proportion of tax payable compared to 2017-18, the greatest benefits will flow to those on lower incomes.
- Those earning $40,000 will pay 21% less tax
- Those on $80,000 will pay around 11% less tax this year.
These expanded tax cuts are part of a major structural reform to our tax system that will see around 95% of taxpayers face a marginal tax rate of no more than 30 cents in the dollar in 2024-25.
This tax relief rewards hard work and creates jobs.
It means Australians will have more of their own money to spend on what matters to them, generating billions of dollars of economic activity and tens of thousands of new jobs.
It will help local businesses to keep their doors open and hire more staff.
Under the Coalition, taxes will always be lower.
KICK STARTING INVESTMENT
Eight out of every ten jobs in Australia are in the private sector.
It is the engine of the Australian economy. It needs a kick-start.
To unlock investment, the Morrison McCormack Government is building on the successful Instant Asset Write Off.
Over 99% of businesses will be able to write off the full value of any eligible asset they purchase for their business.
This will be available for small, medium and larger businesses with a turnover of up to $5 billion until June 2022.
This will dramatically expand Australia’s productive capacity and create tens of thousands of jobs.
For example, this will mean a trucking company can upgrade their fleet, a farmer can buy a new harvester and a manufacturer can expand their production line.
Small businesses will buy, sell, deliver and install these assets.
Every sector of our economy will benefit, creating jobs around the country.
COVID-19 has turned fundamentally sound businesses into loss making businesses.
Through no fault of their own, many companies have faced lockdowns and restrictions that have severely impacted their ability to trade.
Normally, companies would have to return to profit before they can use these losses.
But these are not normal times.
In order to keep their workers, these companies need help now.
So companies that have been doing it tough throughout this crisis will be able to use their losses earlier.
Losses incurred to June 2022 can be offset against prior profits made in or after the 2018-19 financial year.
Together with our reforms to insolvency and the provision of credit, we are giving Australian businesses their best chance to succeed and keep people in work.
MANUFACTURING AND RESEARCH & DEVELOPMENT
Our manufacturing sector employs around 860,000 Australians.
COVID-19 has reinforced the importance of Australia’s sovereign manufacturing capability.
Resourceful Australian businesses have adapted. For example:
- A reconfigured supply chain tripled mask production at a factory in Shepparton.
- Production lines for sleep apnoea devices were converted to make ventilators in Western Sydney.
- Gin distilleries became manufacturers of hand sanitiser across Tasmania.
The Morrison McCormack Government will build on these strengths with a plan to ensure Australian manufacturing plays an even greater role in our economic recovery.
The $1.3 billion Modern Manufacturing plan will target six national manufacturing priorities:
- food and beverage manufacturing:
- resources technology and critical minerals processing:
- medical products:
- recycling and clean energy:
- defence industry; and
- space industry.
This will deliver better collaboration. It will help to commercialise Australian research and better integrate our manufacturing into global supply chains.
This Initiative builds on the JobMaker platform of enabling our manufacturing businesses to be globally competitive through: cheaper and more reliable energy; better skills and training; lower taxes; less red tape; and more flexible workplaces.
This Budget also provides $2 billion in additional Research and Development incentives – removing the cap on refunds, lifting the rate and rewarding those businesses that invest the most.
We are also providing $1 billion for new research funding for our universities, backing our best and brightest minds whose ideas will help drive our recovery
$1.9 billion in new funding is being delivered as part of our energy plan to support low emissions and renewable technologies, helping to lower emissions and address climate change.
We are also helping to unlock five key gas basins starting with the Beetaloo Basin in the Northern Territory and the North Bowen and Galilee Basins in Queensland.
More gas at a lower price will support jobs in Australia’s manufacturing sector.
Rebuilding our economy includes building more roads, rail and bridges.
In this Budget, the Morrison McCormack Government is expanding its record 10 year infrastructure pipeline which is already supporting 100,000 jobs on worksites across the country today.
Together with what has been announced since the start of the crisis, this Budget will see $14 billion in new and accelerated infrastructure projects to support a further 40,000 jobs.
This will boost productivity and deliver long term benefits for Australians.
Major projects are being funded across each state, including:
- The Singleton Bypass and Bolivia Hill Upgrade in New South Wales;
- The upgrade of the Shepparton and Warrnambool Rail Lines in Victoria;
- The Coomera Connector in Queensland;
- The Wheatbelt Secondary Freight Network in Western Australia;
- The Main South Road Duplication in South Australia;
- The Tasman Bridge Upgrade in Tasmania;
- The Carpentaria Highway Upgrades in the Northern Territory; and
- The Molonglo River Bridge in the Australian Capital Territory.
These and many other projects will help set Australia up for the future.
Building more infrastructure now means more jobs now.
A further $2 billion is being invested in road safety upgrades to save lives.
Funding for these shovel ready projects will be provided on a use it or lose it basis.
If a state drags its feet, another state will get the money. We need works to start, not stall.
The Local Roads and Community Infrastructure program is also being expanded.
This will mean an additional $1 billion to support local councils to immediately upgrade local roads, footpaths and street lighting.
These investments in our local communities will support local jobs.
RECOVERY IN OUR REGIONS
The Budget includes a package of measures to create jobs and back regional Australia’s economic recovery. These include:
- $2 billion in concessional loans to help farmers overcome the devastating drought;
- $350 million to support regional tourism and attract domestic visitors back to the regions and a further round of the Building Better Regions Fund;
- $317 million for Australian exporters to continue to access global supply chains, building on the 80,000 tonnes of exports we have already helped get to market.
This Government is building water infrastructure for the 21st Century to increase our water security, build resilience, deliver jobs, and grow our agriculture sector.
We have already funded over 20 projects to supply billions of litres of water for productive use, with construction of the Emu Swamp dam currently underway.
This Budget doubles the Government’s commitment to Wyangala and Dungowan dams with investment totalling $567 million.
A further $2 billion in new funding will build vital water infrastructure across the country as part of our national water grid including dams, weirs and pipelines.
INCREASING HOME OWNERSHIP AND AFFORDABLE HOUSING
The Morrison McCormack Government is helping thousands more Australians achieve home ownership, and supporting thousands of jobs in the construction industry.
An additional 10,000 first home buyers will be able to purchase a new home sooner under our First Home Loan Deposit Scheme.
This builds on the 20,000 first home buyers we are helping to purchase a home this year under this Scheme with a deposit as low as 5%.
In this Budget, the Morrison McCormack Government is also enabling an additional $1 billion of low cost finance to support the construction of affordable housing.
This takes the total concessional finance that has been made available to community housing providers to $3 billion.
This is in addition to the $4.6 billion a year the Government provides in rental assistance.
The Government is also investing $150 million in the Indigenous Home Ownership Program to construct new homes in regional areas, creating more jobs and helping hundreds of indigenous families buy their own home.
GUARANTEEING ESSENTIAL SERVICES
The COVID-19 crisis has confirmed how vital it is to have a strong economy that can continue to guarantee the delivery of essential services.
In this Budget, there is record funding for hospitals, schools, child care, aged care and disability services.
The Budget will deliver record funding for health, with total spending of $93.8 billion in 2020-21, an increase of almost 43% since 2014-15.
This will ensure Australians can continue to access the essential medical, pharmaceutical and hospital services they rely on.
The Morrison McCormack Government has committed over $16 billion as part of our health response to the COVID-19 crisis.
Securing millions of masks, gowns, goggles, and ventilators, the Australian Government has worked with the States to significantly increase the capacity of Intensive Care Units across the country.
Medicare subsidised telehealth services have been extended, enabling more than 30 million consultations since the crisis began.
Access to more than 80 million doses of potential vaccines for COVID-19 has been secured.
The Pharmaceutical Benefits Scheme (PBS) provides access to critical medicines for all Australians.
The Liberal and Nationals Government have delivered on our commitment to list all medicines recommended by the independent experts.
Under this Government, there has been more than 2,000 new and amended listings since 2013.
This Budget includes $376 million for new and amended listings on the PBS, including lifesaving medicines to treat leukaemia, melanoma and Parkinson’s disease.
This includes the listing of Lynparza® to help women with ovarian cancer.
Instead of costing more than $140,000 per course, patients will now access the medicine at $6.60 per script for concession card holders and $41 per script for general patients.
The Government’s total commitment to mental health support is $5.7 billion this year, including funding for critical front line services and suicide prevention.
For many Australians – young and old – COVID-19 has caused significant pain.
Around 7 million Medicare subsidised mental health services have been delivered since March.
This Budget doubles the number of Medicare funded psychological services available through the Better Access Initiative, from 10 to 20.
More funding is being provided for Lifeline, headspace, Beyond Blue and Kids Helpline.
An additional $3.9 billion is being provided for the NDIS which is providing life-changing support to 400,000 Australians with a disability.
Every Australian can be confident that the NDIS will always be fully funded under a Coalition Government.
Senior Australians have faced enormous challenges during COVID-19 including isolation and separation from their children, grandchildren and friends.
To support our Age Pensioners, the Government provided $750 payments in April and July.
Now, Age Pensioners will receive an additional $250 payment in December and another $250 payment in March.
During this crisis an additional $1.6 billion has already been provided to support the needs of Australians in aged care.
This Budget will provide further support to older Australians who wish to stay at home for longer by providing $1.6 billion for an additional 23,000 home care packages across all package levels.
This brings the total to more than 180,000 places – three times the number of home care packages than when this Government was elected.
99% of all those seeking an in-home aged care place now have access to some form of in home support.
This Government is also investing more in this Budget to improve skills in the aged care workforce and provide additional dementia training and support.
The Government is investing record funding in Australian schools.
Annual recurrent funding for schools has increased from $13.8 billion in 2014 to $21.8 billion in 2020, with a commitment of $310 billion in total recurrent funding from 2020 to 2030.
The COVID-19 pandemic has resulted in significant changes to teaching and learning for young Australians. The Government will provide an additional $146 million to improve the educational outcomes, particularly for disadvantaged students.
We have also guaranteed $18 billion in funding for all higher education institutions in 2020 in response to the COVID-19 pandemic.
This Budget delivers enhanced support for veterans and their families to maintain their wellbeing, protect their mental health and assist them to transition successfully to civilian life.
This includes $94 million to improve mental health outcomes and ensure high-quality care for older veterans and their families.
Eligible veteran income support recipients and concession card holders will also receive two additional $250 Economic Support Payments in late 2020 and in early 2021.
PROTECTING OUR ENVIRONMENT
This Budget includes $1.9 billion in new funding as part of our energy plan to support low emissions and renewable technologies, helping to lower emissions and address climate change.
The Budget provides a further $1.8 billion in funding for the environment, which will help our wildlife recover from the Black Summer bushfires and to protect and enhance our unique natural environment.
This includes undertaking the biggest single investment in Australia’s Commonwealth National Parks, injecting $233 million to upgrade facilities in Uluru, Kakadu, Christmas Island and Booderee National Park.
This Budget also provides $67 million in further funding to protect our oceans by improving their health and restoring Australia’s mangroves, tidal marshes, and sea grasses.
By recycling more waste we can also create jobs.
The Morrison McCormack Government is banning the export of plastic, paper, tyres and glass waste.
In the words of the Prime Minister: ‘it’s our waste, it’s our responsibility’.
This Budget will invest $250 million to modernise our recycling infrastructure, stop more than 600,000 tonnes of waste ending up in landfill and by doing so, help to create a further 10,000 jobs.
Recently, the Government also outlined its technology led plan to lower emissions, lower costs and support jobs.
This includes investments in clean hydrogen, electricity storage, low emissions steel and aluminium production, carbon capture and storage and soil carbon sequestration.
KEEPING AUSTRALIANS SAFE
The coronavirus is a new and invisible enemy.
However, other threats to our security have not gone away.
The Morrison McCormack Government is investing a total of $1.7 billion in a cyber-security plan to keep Australians safe and secure online.
An additional $450 million is being provided for our law enforcement and intelligence agencies to keep Australians safe from foreign and domestic threats.
Record funding is being provided for the Australian Defence Force.
In this Budget the Government is bringing forward $1 billion in planned defence spending to support jobs as well as extending a range of health and employment programs for our veterans, helping them transition to civilian life.