The winners and losers of the 2022 Federal Budget

The Albanese government has unveiled its first budget, promising to make life “easier for Australians.”

Treasurer, Jim Chalmers, who delivered Labor’s first budget in nearly 10 years on Tuesday, said the budget would provide cost of living relief “responsibly and not recklessly” without adding to inflation.

The key winners and losers are as follows.

Winners

Aged care residents and workers

Labor has promised aged care reform costing $2.5 billion over the next four years, with the bulk of the funding going towards paying staff.

As of July 1 2023, all facilities for the elderly must have a registered nurse on-site at all times. From October 2024, each resident must receive 215 minutes of care every day.

$540.3 million will also be spent responding to the final report of the Royal Commission into Aged Care Quality and Safety. This includes $68.5 million which will go towards supporting the implementation of aged care reforms in regional areas.

Families

One of the centrepieces of the government’s budget is its $4.7 billion spend on child care over the next four years, with a goal of providing universal child care to 90 per cent of all families.

Additionally, from July 2023, the government will start to increase the amount of government Paid Parental Leave to reach a total of 26 weeks by 2026. The policy comes with a price tag of $530 million.

There’s also an allocation of $39 million to be spent over four years, to increase and improve the consistency of screening programs done on newborns.

The government will provide $13.9 million over three years to support bereaved parents. 

Students

The government will pay for 20,000 students from under-represented backgrounds to study university courses including nursing and engineering. The budget includes $159 million to train an extra 4,036 teachers as part of a national action plan to solve the country’s dire shortage of educators.

Charles Darwin University, the University of Wollongong, and Curtin University are the higher education institutions receiving the greatest funds for extra enrollments. With an expenditure of up to $485.5 million over the following four years, the extra spaces will be for students beginning in 2024.

Additionally, the government will pay for 180,000 fee-free TAFE and vocational education spots in 2023, with additional assistance for participation by women and other disadvantaged groups. The places will be made up of 60,000 additional places and by dropping the fees of 120,000 existing paid TAFE spots.

The Environment and Renewables

In this financial year alone, $2.3 billion will be spent on the environment and climate change projects.

Over $600 million will be spent protecting threatened species over five years and up to 1,000 Landcare rangers will be trained at a cost of $90 million dollars.

$102 million will be used to establish community solar banks, so as to improve access to solar power for people typically unable to access it.

Another $224 million will help establish 400 community batteries to reduce reliance on fossil fuels.

Women

The government will invest $1.7 billion over six years to implement the new national 10-year plan to end violence against women and children.

There’s also funding for 500 frontline community workers ($169.4 million over four years) and $100 million for crisis and transitional housing options for women and children fleeing violence, along with older women on low incomes at risk of homelessness.

The federal government says it will work with the states and territories to end violence against women and children within “a generation.”

The treasurer also said Labor agreed that full employment, productivity growth and equal opportunities for women should be core objectives of government policy.

Housing

Between 2024 and 2029, the government has set a goal of building one million new homes.

The government also expects there will be around 180,000 housing completions each year in 2022, 2023 and 2024 before the goal kicks in.

The budget also includes $350 million for the Federal Government and States and Territories to build 10,000 new homes each year.

The government will invest $10 billion in the newly created Housing Australia Future Fund, to deliver 30,000 social and affordable homes over five years and allocate $330 million for acute housing needs.

Labor will spend $324.6 million over four years to establish its Help to Buy shared equity scheme to assist people on low to moderate incomes to purchase a new or existing home.

Neutral

Healthcare

The government announced $787.1 million over the next four years to reduce the cost of buying medicines.

People on the autism spectrum will benefit from more than $5 million in funding over 2022-23 for research, early intervention services, and a national autism strategy.

Cancer patients are winners too with a massive $450 million for two new comprehensive cancer care centres in Adelaide and Brisbane, and additional funding towards newborn screening and women’s health during and after pregnancy.

But there’s still uncertainty surrounding how the government will address Medicare funding.

It’s investing $750 million in the Strengthening Medicare Fund, with the Strengthening Medicare Taskforce determining how best to spend to improve access and care for patients.

For the purpose of easing the burden on public hospitals and enhancing access to healthcare, the government is investing $235 million in the expansion of urgent care clinics. But public hospitals receive no new funds.

Mental health also hasn’t received a huge boost with only $24.3 million over four years for more Headspace centres and a boost to preventing suicide in the manufacturing sector.

Losers

Motorists

Motorists have missed out on “responsible” cost of living relief included in the budget.

The Albanese government has not reinstated the fuel excise discount, which will save it $30 billion over six months.

The federal government’s fuel tax for motorists was halved to 22.1 cents a litre until September 28, when the discount expired. The former Coalition government temporarily cut the excise in late March as inflation started to spike, meaning Australians were partly shielded from soaring petrol prices.

Renters

Rental costs are expected to rise considerably in the next two years.

Nationally advertised rents have risen sharply over the past year, by 10 per cent to September 2022.

As new rental agreements are made and existing contracts are renegotiated, overall rental costs as reflected in the CPI are expected to rise, albeit to a lesser extent.

Despite these warnings, the budget doesn’t include any plan to contain rental prices in the short term or to provide relief to tenants who are struggling with the cost of living.

Wage Earners

With inflation expected to reach 7.75% in December, workers’ pay is expected to continue to go backwards until 2024-25.

In the year to the end of the June quarter, wages grew 2.6%, whilst there was a 6.1% jump in the cost of living.

There is a sliver of good news: The government says wages are growing faster now than they were before the election. However, that is tempered by rising electricity prices and grocery bills eating into pay packets.

When that inflation moderates, real wages are expected to start growing again in 2024.

Tax Avoiders

While the government ruled out raising income or other taxes, it has made its tough stance on multinational tax avoidance clear.

The budget contains an extra $200-million-a-year funding boost to the ATO for the next four years to extend its Tax Avoidance Taskforce.

The government says the extra cash will bring back an estimated $2.8 billion over four years in otherwise unpaid tax.

It’s also going to introduce a few new reporting requirements for Australian companies, including the number of subsidiaries they have and where they’re registered for tax purposes.

SOURCE: ABC News, Daily Telegraph