2022-2023 Federal Budget is Bringing New Homes

Jim Chalmers the Federal Treasurer handed down the federal budget on Tuesday 25 October 2022. It is Labor's first budget in a decade, and it hasn’t delivered too many surprises. Labor has set a target of 1m new homes to be delivered over the next five years from mid-2024, when capacity constraints are expected to ease. It includes 20,000 affordable homes, with an additional 30,000 affordable and social homes to be delivered via housing Australia future fund returns. Some 10,000 first home buyers in the regions will also be eligible to buy a home with a federal government guarantee of up to 15% of purchase price.

• New housing accord – 1 million new homes over 5 years, from 2024.
• 30,000 new social and affordable homes within 5 years
• The Government will establish the Regional First Home Buyers Guarantee to support eligible citizens and permanent residents who have lived in a regional location for more than 12 months to purchase their first home in that location with a minimum 5 per cent deposit, with 10,000 places per year to 30 June 2026.
• Stage 3 tax cuts remain
  • $120k to $180k bracket abolished
  • Top rate to start at $200k
  • Marginal rate for $45k to $200k cut from 32.5% to 30%
• The Paid Parental Leave Scheme will become more flexible for families:
  • Both birth and non-birth parents are allowed to receive the payment if they meet the eligibility criteria (to take effect from 1 July 2023).
  • Parents will also be able to claim weeks of the payment concurrently so they can take leave at the same time.
  • From 1 July 2024, the Government will start expanding the scheme by two additional weeks a year until it reaches a full 26 weeks from 1 July 2026.
  • Both parents will be able to share the leave entitlement, with a proportion maintained on a “use it or lose it” basis, to encourage and facilitate both parents to access the scheme and to share the caring responsibilities more equally. Sole parents will be able to access the full 26 weeks.
• $1B in fee-free TAFE and vocational education resulting in 180,000 places in 2023 for priority areas.
• No funding for Hells Gates Dam, Urannah Dam
• Net overseas migration increase to be around 235k this financial year
• New Energy Apprenticeships program providing 10k apprentices with up to $10k in a support payment ($2k on commencement, $2k per year for up to 3 years and $2k on completion), focused on clean energy trades
• Unlimited instant asset write-off finish from July 2023 returning to original form (small businesses with a turnover of up to $10m limited to writing off assets worth up to $1k).
• Almost $70M over 4 years for Fair Work Ombudsman to take on ABCC’s regulatory role, with changes to the scope
• Australian Skills Guarantee sees 1 in 10 workers on major Government projects as an apprentice, trainee or paid cadet. Targets for women also being considered.

There are a number of savings where the razor has been taken to some of the previous government’s programs and bodies it set up, including the abolition of the ABCC.  The Registered Organisations Commission (the regulator for unions and some employer associations) loses nearly $27m, which has been diverted to the Fair Work Commission for various programs.

Most of the funding for VET is unsurprisingly focussed on TAFE, but we have been advocating for industry not-for-profit RTOs like Master Plumbers / PICAC training to also get a share and this message has been featured in media interviews by our partner the Australian Chamber of Commerce and Industry (ACCI). 

In terms of taxation, there are no changes to the planned Stage 3 personal tax cuts in the Budget, which lowers the 32% tax rate to 30%, abolishes the 37% tax rate and increase the 42% tax threshold from $180,000 to $200,000, effectively applying a 30% tax rate to all employees.

Link to more info - https://budget.gov.au/