Five minute guide of the 2022 federal budget
Housing, childcare, and education changes are coming, as is cost of living relief for some Aussies. See the full guide of how the budget now affects you.
Federal Budget
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Treasurer Jim Chalmers has delivered Labor’s first Budget in almost a decade, a modest account that stuck mainly to promises made during the election campaign, including keeping the former government’s stage three tax cuts.
While many of the Budget’s big items had previously been announced — including a pledge to build one million new houses and increase Paid Parental Leave to 26 weeks — there were still a few surprises, including an announcement that Defence spending would surge beyond 2 per cent of GDP.
The 2022/23 deficit was estimated at $36.9 billion, with no sign of a return to surplus over the next five years.
Cost of living pressures will be eased in a number of ways, including cheaper PBS medicines and a $4.6 billion boost to childcare subsidies.
Here’s your five-minute guide to the Federal Budget:
HOUSING
* New Housing Accord: aim to build one million new, well-located homes over five years from 2024. Supply to come from the market, not the government. To get the Accord started, this Budget commits an initial $350 million in additional funding for another 10,000 new affordable homes.
* Housing Australia Future Fund – building 30,000 new social and affordable homes in its first five years; and the National Housing Infrastructure Facility supporting an additional 5500 new homes.
* Help to Buy Scheme – allowing up to 40,000 eligible Australians to own their own home with a lower deposit and smaller mortgage.
* Regional First Home Buyer Guarantee – supporting another 10,000 new homeowners each year.
TAX
* Stage 3 cuts: Labor has ruled out making any changes to the contentious stage three tax cuts package. The third tranche of tax cuts is set to be the biggest expense to the budget at $20b a year when it comes into effect in 2024. The cuts mean anyone earning between $45,000 and $200,000 will pay no more than 30 cents of every dollar they earn in tax.
* A multinational tax integrity package, raising around $1 billion over four years.
* Extending compliance programs for tax avoidance, raising $3.7b over four years.
CHILDCARE
* $4.6 billion to increase Child Care Subsidy rates for families earning less than $530,000.
* Australian Competition and Consumer Commission to report by end of 2023 on the drivers of prices and the impact of the Child Care Subsidy increases on out-of-pocket fees,
* Productivity Commission to look at implementing a universal 90 per cent Child Care Subsidy rate.
PAID PARENTAL LEAVE
* $531.6 million over four years from 2022–23 to modernise Paid Parental Leave.
* From July 1, 2023, the Government will provide a 20-week payment to families, including maintaining a portion reserved for each parent on a ‘use it or lose it’ basis. Single parents will be able to access the full 20 weeks.
* An additional two weeks will be added each year from July 2024 to July 2026, increasing the overall length of payment under the Paid Parental Leave scheme by six weeks.
COST OF LIVING
* A multinational tax integrity package which raises around $1 billion over four years
* Extending compliance programs for tax avoidance, shadow economy and personal income tax, raising $3.7 billion over four years
* Working with overseas partners to reform the international corporate tax system to better address the challenges arising from digitalisation and globalisation.
* The Government will allocate $50m over three years to fund grants to support early and mid-stage critical minerals projects. This is in additional to $50m the government recently committed to six key projects across Australia.
* Labor’s National Reconstruction Fund will include the $1bn “Value Adding in Resources Fund” which will work alongside the $2bn Critical Minerals Facility.
AGED CARE
* Elderly receiving care in their own homes will have their administration and management fees capped and exit fees will be banned.
* A dedicated Aged Care Complaints Commissioner will ensure complaints are properly and thoroughly dealt with ($9.9m).
* A new independent Inspector-General of Aged Care will target systemic issues to improve outcomes for older Australians ($38.7m).
* Funding for a pending Fair Work Commission pay rise for 300,000 aged care workers
DEFENCE
* Defence spend to rise to more than two per cent of GDP for the first time in two decades
* More than $147m to “advance” Pacific security and engagement including establishing an Australia Pacific Defence School for multinational military training
* $213m over five years in assistance to Ukraine in its war with Russia
* $31.3m toward Australia’s cyber security fight
* $233.9m over four years to recruit 500 new staff in Veterans’ Affairs to “speed up” compensation claims
HEALTH CARE
* A $2.9 billion to revamp of primary health care will make it easier for Australians to see a doctor it by establishing 50 Medicare Urgent Care Clinics
* A $229m new GP grants program to help doctors upgrade technology, buy new equipment, ventilation and infection control
* Mums and babies to benefit from new National Newborn Bloodspot Screening programs that will lift the number of conditions screened for at birth from 25 to 80
* Women’s health during and after pregnancy will be strengthened with updated pregnancy care clinical guidelines and new post-natal care guidelines ($5.9m) new national network of peri-natal mental health and wellbeing centres ($26.2m) and families bereaved by stillbirth will get more support ($13.9m).
* Expansion of the headspace network ($23.5m).
* Cheaper medicines the maximum co-payment of $42.50 will drop to $30 ($787.1m) from 1 January 2023.
* Strengthening First Nations health ($314.5m)
NDIS
* $137.7m on a Fraud Fusion Taskforce to strengthen fraud detection
* $5.8m Alternative Dispute Resolution Pilot to achieve fairer, faster and better
outcomes for NDIS participants
* $6.6 million for participants to access advocacy and legal assistance
* An extra 380 permanent staff
WOMEN
* $1.7 billion in the next six years to end violence against women and children.
* amending the Fair Work Act 2009 to provide access to 10 days of paid family and domestic violence leave.
* $169.4 million over 4 years to fund 500 frontline service and community workers to support women and children experiencing family, domestic and sexual violence.
INFRASTRUCTURE
* $1.5 billion on the Freight Highway Upgrade Program to seal the Tanami Track in the Northern Territory and Western Australia, as well as upgrade other nationally significant freight routes, including the Dukes, Stuart and Augusta Highways in South Australia and Central Arnhem Road in the Northern Territory.
* The Government will continue to invest in the Outback Way in Western Australia,
the Northern Territory and Queensland, maintaining a total investment of $1 billion.
* $3 billion to partner with state and territory governments to roll out lifesaving projects under the Road Safety Program, with the delivery of total nationwide funding to continue through to mid-2025.
* $26 million towards specific road safety grants over three years from 2022-23, addressing priorities identified in the National Road Safety Strategy and Action Plan.
* $500 million for the corridor acquisition, planning and early works of a Sydney to Central Coast and Newcastle High Speed Rail project following the introduction of legislation to establish the High Speed Rail Authority.
* $80 million to deliver Heavy Vehicle Rest Areas nationwide to support truck drivers
* $60 million to deliver on our election commitment for a substantial runway upgrade to Hobart Airport and a further $55 million towards upgrading international terminal facilities at Newcastle Airport
* $14 million over four years for the Australian Automobile Association to test the on-road fuel consumption and emissions of cars, SUVs and utes sold in Australia from 2023 to 2026
JOBS AND WORKERS
* One-off $4000 credit to the Work Bonus income banks of Age and Service pensioners in 2022–23 to give older Australians the option to work and keep more of their money. The temporary income bank credit will increase the amount pensioners can earn this financial year from $7,800 to $11,800 before their pension is reduced, enabling pensioners who want to work to immediately boost the supply of labour to help meet shortages.
EDUCATION
* TAFE: a $1 billion investment in fee-free TAFE and vocational education places. Providing 180,000 places next year for priority areas, like the care sectors and the digital economy.
* Schools: more than $770 million for better schools, happy and healthier students, and more qualified teachers.
* University: $485 million to create 20,000 new university places over the next two years for students from disadvantaged backgrounds
ENVIRONMENT
* $1.8b investment, including $1.2b to protect and restore Great Barrier Reef.
* $90 million to employ and upskill up to 1,000 Landcare Rangers to help conserve and restore our environment.
* An extra $66.5m to support 10 new Indigenous Protected Areas, as well as $14.7m for the protection of cultural and First Nations heritage sites.
* $224.5m to help threatened species and places, including koala conservation and addressing the threat of Yellow Crazy Ants
Electric vehicles
* An additional $275 million to deliver the $500 million electric vehicle charging network, including funding for 117 highway charging sites
* $345 million Electric Car Discount will exempt eligible EVs from fringe benefits tax (FBT) and 5 per cent import tariff, saving $9000 on a $50,000 EV
Climate
*A $1 billion fund mitigating potential natural disaster loss and damage
* $38.3 million to the veteran-led Disaster Relief Australia to enhance their operations, which will also help to reduce pressure on the ADF
Biosecurity
* $61.6 million fast tracked to bolster Australia’s biosecurity system, including $11.7 million for more detector dogs and $46.7 million increased funding for traceability initiatives
NBN
* $31.9 billion in equity to NBN Co, with the final contributions to be made in 2025-26.
* $2.4 billion to extend full-fibre access to 1.5 million additional premises, including to over 660,000 in regional Australia.
* Up to 30,000 families will receive 12 months free broadband, helping unconnected students access broadband and boosting their education opportunities.
* $1.2 billion will further advance regional telecommunications, consistent with findings from the 2021 Regional Telecommunications Review.
* A further round of the Mobile Black Spot Program will improve coverage in over 50 selected locations. The Peri-Urban Mobile Program will help to find tailored connectivity solutions to locations along the urban fringe – importantly in natural disaster-prone areas. The investment also includes the already funded $480.0 million fixed wireless upgrade.
COVID-19
* The government will spend $1.4bn to extend Covid-19 response measures by three months, until December 31 this year. The funding includes $840m for aged care support including on-site PCR testing
* $142m in Medicare rebates for Covid-19 testing; and $235m to distribute PPE and rapid antigen tests from the National Medical Stockpile to at-risk groups and frontline healthcare workers.
SUPERANNUATION
* The age at which people can drop a lump sum into their super from a house sale will drop from 60 to 55 years. This is to encourage a greater turnover in housing stock.
OTHER
* Establishing a National Anti-Corruption Commission
* $1.2 billion in practical measures to Close the Gap for First Nations people and communities, and to begin preparations for a referendum on a Voice to parliament.
Originally published as Five minute guide of the 2022 federal budget
Read related topics:Cost of Living
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