The Turnbull Government is making the right choices to ensure our nation’s remarkable economic growth story continues, so we can secure better days ahead for all Australians.
Our economic growth has been hard won and we have consistently outperformed the largest advanced economies in the world.
However our success cannot be taken for granted.
This Budget makes the right choices for Australians who are working hard to secure the better days ahead for themselves and their families and is based on the principles of fairness, security and opportunity.
The choices we have made are clear.
A fair and responsible path back to budget balance
We are choosing to ensure the Government lives within its means, taking practical action to reduce the deficit and the growth in our debt and doing all we can to preserve our AAA credit rating, whilst pursuing policies to grow the economy.
As a result of the Government’s consistent and determined efforts, the Commonwealth Budget is still projected to return to balance in 2020-21.
All new spending has been fully offset and the average real growth in payments over the forward estimates remains below 2 per cent per year, consistent with the last Budget and down from the 3.5 per cent spending growth we inherited when we came to government.
The Government will responsibly address unfunded future superannuation liabilities by deferring drawdowns from the Future Fund to allow its assets to grow and fill the gap that still exists to offset unfunded superannuation liabilities.
The Government will make our financial system better for customers and taxpayers through greater competition, accountability and fairness. This will include a Banking Executive Accountability Regime; an investigation into financial system competition and a levy on large banks, securing $6.2 billion to support budget repair.
Stronger growth to create more and better paid jobs
We are choosing to build on our National Economic Plan for Jobs and Growth.
We will extend the instant asset write off to small businesses for a further twelve months and provide funding to incentivise States and Territories to cut red tape for small businesses.
The Government is committing over $70 billion to transport infrastructure across Australia to reduce congestion, revitalise our cities and grow our regions, using a combination of grant funding, loans and equity investments.
A $10 billion transformational National Rail Program will deliver rail projects across the nation that better connect our cities, regions and create new opportunities for housing, and grow the economy.
The Government will provide equity of up to $5.3 billion to deliver Western Sydney Airport and additional equity of $8.4 billion to the Australian Rail Track Corporation to deliver the Melbourne to Brisbane Inland Rail project.
The Government will require businesses employing foreign workers on certain skilled visas to contribute to a new Skilling Australians Fund to help Australians develop the skills they need to be job-ready.
Guaranteeing essential services for Australians
The Budget guarantees key government services that Australians rely on by:
- Establishing the Medicare Guarantee Fund that by law can only be used by the Government to pay for expenses for the Medicare Benefits Schedule (MBS) and the Pharmaceutical Benefits Scheme (PBS).
- Listing $1.2 billion in new medicines on the Pharmaceutical Benefits Scheme; lifting the freeze on the indexation of the Medicare Benefits Schedule introduced by the former Labor Government and reversing the removal of bulk billing incentives for diagnostic imaging and pathology services.
- Fully funding our contribution to the National Disability Insurance Scheme (NDIS) through a 0.5 percentage point increase in the Medicare levy from 1 July 2019 linked to the NDIS Savings Fund.
- Continuing to invest record amounts in education and driving better outcomes for both students and taxpayers as part of a suite of higher education reforms.
Placing downward pressure on rising costs of living
The Government’s energy security plan will provide reliable and affordable energy for Australians coping with rising energy prices including by: securing access to our gas resources for domestic use, ensuring consumers and businesses get a fairer deal, commitments to progress major energy storage projects including pumped hydro in Snowy 2.0 and implementing changes agreed by COAG’s Energy Council to improve gas market efficiency and transparency.
We have chosen to act to put downward pressure on rising housing costs for Australians, including: increasing the supply of affordable homes for Australians by targeting new incentives and reforming housing related payments to the states to increase the supply of housing where it is most critical, particularly affordable rental housing.
We will also permanently extend funding for homelessness, fund ‘micro’ city deals with the aim of removing infrastructure impediments to developing new homes and apartments on selected sites as well as develop an online land registry which will create opportunities for developers and others in the community to propose better use of Commonwealth land.
A new National Housing Finance and Investment Corporation (NHFIC) will be established by 1 July next year to provide long term low cost finance to the community housing sector to support more affordable rental housing and; incentivise affordable housing development.
We will also support first home buyers by providing a tax cut for their deposit savings. First home buyers will be able to voluntarily contribute to their superannuation account, including through salary sacrifice arrangements, over and above their compulsory superannuation contributions, to build their first home deposit faster.
We will also continue to tighten the rules on foreign real estate investors.
Ensuring the government lives within its means
The Government will continue to ensure multinationals pay their fair share of tax. Our actions have already raised $2.9 billion in tax liabilities this financial year against a group of just seven large multinational companies, and are expected to raise more than $4 billion in total this financial year from large public groups and multinationals.
We will also continue to focus on stopping people trying to take an easy ride on our welfare system by strengthening mutual obligation requirements for payments and cracking down on those seeking to get out of those obligations.
The responsible plan set out in this Budget, based on the principle of fairness, security and opportunity, is credible and affordable. But above all this Budget sets out an honest plan, making the right choices to secure the better days ahead.
It is honest about the challenges we face and honest about what we can and should do about them.
That is why this Budget is a plan that can be trusted and supported, not just by the Australian people, but by their Parliament.
They are the right choices to secure the better days ahead for all Australians.