SA Budget 2020: Tunnels, tennis stadium and tax relief

Treasurer Rob Lucas has delivered the 2020 State Budget, announcing an underground motorway to finish the North-South Corridor, sport stadium upgrades and tax relief.

Adelaide’s South Road will get tunnels and the state’s home of tennis will get a major refurbishment as part of an infrastructure heavy budget aimed at getting the state back on a road to recovery.

Treasurer Rob Lucas has today delivered his “drowning in red ink” State Budget that records a $2.59bn deficit for this year – and debt ballooning out to $33.2bn over the forward estimates.

As revealed in the lead up to today’s State Budget there is a major emphasis on infrastructure – with a heavy focus on projects that can be delivered, or at least progressed significantly, over the next two years.

One of the major surprises of the State Budget is a $233m payroll tax program that includes a 12 month waiver for companies that put on a new trainee or apprentice.

The government wants a further 750 traineeships and apprenticeship places in areas such as cyber security, aged care, disability services and housing construction.

The program also includes a 15 month waiver of payroll tax for businesses and business groups with annual Australian grouped wages below $4m.

Businesses receiving JobKeeper from 4 January 2021 will get a six month waiver.

Larger businesses with a payroll greater than $4m, that have been adversely effected by COVID-19, will get a nine month deferral.

The State Budget also includes an expansion of land tax relief.

A public sector infrastructure program will grow from $12.6bn to $16.7bn.

Mr Lucas has promised the spend will create 19,000 jobs over the next four years.

There is a $204 million fund dedicated to a Sport and Recreation infrastructure plan with $45m to bring Hindmarsh Stadium to a contemporary elite sport standard and $44 million for stage two of the Memorial Drive Tennis Centre redevelopment.

Memorial Drive will receive $44m for stage two of its redevelopment.

An artist’s impression of stage two of the Memorial Drive upgrade.

More projects are expected to be announced in the next few weeks by Infrastructure Minister Corey Wingard.

In the long term the government have committed to completing the final stages of the North-South corridor, at an estimated cost of $8.9bn, by 2030.

An artist impression of the North-South Corridor proposed tunnels under Henley Beach Rd, Torrensville.

Final renders of the North-South Corridor - proposed start of the motorway at Darlington

The design includes two tunnels and a 78km non-stop motorway from Gawler to Old Noarlunga means major heritage icons along the route – including the Thebarton Theatre – are saved along with hundreds of homes that had faced a potential wrecking ball.

There were however, no more details on the new Women’s and Children’s Hospital with the final design and costs to be unveiled after a business case is completed early next year.

Events that will be expected to fill the hole left by the scrapping of the Superloop have not been unveiled today.

Mr Lucas said an extra $12 million over three years has been provided to help attract new events to South Australia.

“One such event will be Illuminate which will run over two weeks and three weekends in July and is being led by home grown Creative Leaders Rachael Azzopardi and Lee Cumberlidge who are working in collaboration on the event with representatives from the creative, scientific, business and entrepreneurial sectors,” he said.

The budget also commits $10 million per year ($40 million over four years) to continue existing levels of funding available for events and conventions.

An events advisory committee will be established to determine those projects over the coming months.

Money saved by not selling South Australia into international markets will be redirected into domestic sales pitches instead, Mr Lucas has promised.

There is also additional money to help attract new events and conferences.

Mr Lucas pointed out a raft of investments, including another $50 million to the $200 million Aboriginal Art and Cultures Centre at Lot Fourteen and $130 million for parks, as examples of where significant infrastructure projects will benefit the tourism sector over the next few years.

State Treasurer Rob Lucas at Memorial Drive Tennis Club ahead of delivering his State Budget. Picture: Matt Turner

Mr Lucas said over the next four years most of the 2,000 jobs added to the public sector will be in the public school system with a combination of Gonski reform requirements and a shift of focus away from the private education sector by parents.

The state’s public sector however, will be expected to tighten the purse strings as Mr Lucas aims to achieve a predicted surplus of $406m in 2023-24.

New operating savings in the 2020-21 Budget total $198 million over the next four years.

The Budget includes a number of new levers that have the ability to raise millions in revenue.

There will be an increase to the Victims of Crime (VOC) Levy by 50 per cent from January 1, 2021, with the exception of the Youth Levy which remains unchanged.

Motorists that have their cars clamped or impounded will no longer be able to get them back without paying fines first.

In an Australian first a road user charge for plug-in electric and zero emission vehicles will be introduced with the Treasurer arguing they do not attract fuel excise and therefore make a lower contribution to the cost of maintaining the state’s road network.

As revealed in The Advertiser today the budget will reveal a $1.49bn deficit for the previous 2019-20 financial year – down on the forecast $1.9bn.

Over the forward estimates, projected deficits are $2.59bn for the current 2020-21 financial year, $1.42bn for 2021-22 and $435m in 2022-23, before returning to surplus the following year.

The numbers are something Mr Lucas admits he never expected to see in his lifetime.

However, Mr Lucas himself admits everything needs to go right for his budget to be delivered.

The entire document is predicated on the assumption that a nationwide vaccination is available by the end of next year.

Debt is predicted to grow to $33.2bn by the end of the forward estimates.

However, Mr Lucas said even though debt will increase significantly, the estimated interest costs for general government sector debt over the next three years will be $447 million less than the estimate in last year’s budget.

“One of the reasons why the Reserve Bank has urged governments to borrow more to fund stimulus and infrastructure projects is that interest rates are at historically low levels and the Reserve Bank has pledged to take action to maintain that position,” he said.

08/09/20 - Leader of the Opposition Peter Malinauskas during question time at Parliament House. Picture: Tom Huntley

DETAILED BUDGET READING :
AT A GLANCE: Five-minute guide to the Budget
SPORTS UPGRADES: $40m upgrades for Memorial Drive, Hindmarsh Stadium
ANALYSIS: Why this Budget will change SA forever
POLICE: High-def cameras to catch drivers on mobile phones
BUSINESS: Payroll tax holiday extended
ACROSS SA: What’s in the Budget where you live

BUDGET ‘A WASTED OPPORTUNITY’: LABOR

By Elizabeth Henson

The 2020/21 State Budget fails to deliver a single new job this financial year, the State Opposition says.

Labor Leader Peter Malinauskas said the budget showed that despite South Australia “having one of the best health responses to COVID-19 in the nation ... we’ve had one of the worst economic responses”.

“With more than 165,000 South Australians looking for work, we desperately needed a budget which would create jobs now,” he said.

“Instead, Steven Marshall’s own budget papers reveal there will be no jobs growth this financial year, meaning we’re well behind the national jobs growth rate of 2.75 per cent.”

Mr Malinauskas, who described the budget as a “wasted opportunity”, also raised concerns that no major construction work on the state’s two biggest infrastructure projects – the final stage of the North South Corridor and the new Women’s and Children’s Hospital – would begin during the current term of parliament.

“It is remarkable we will see no major works on (Premier) Steven Marshall’s two biggest infrastructure projects, but that speaks to his delays and indecisiveness, which have hurt our state,” he said.

Meanwhile, Opposition treasury spokesman Stephen Mullighan questioned the Government’s ability to generate new jobs, saying before the coronavirus pandemic struck SA, it “racked up $10 billion of debt and delivered the highest unemployment rate in Australia”.

“Now they’re racking up another $10 billion worth of debt, and they expect us to believe this time they’re going to create jobs?” he said.

Mr Mullighan acknowledged there were initiatives in the budget that Labor supported, including several it had been calling for in recent months, such as extra money for the tourism sector.

“There are good initiatives in this budget but the critical test has been failed...by this Government and that is getting immediate money out into the community to stimulate jobs,” he said.

Originally published as SA Budget 2020: Tunnels, tennis stadium and tax relief