We can breathe – Budget 2023 might not be perfect but it’s brought a new lease of life to the sustainability evolution and not a minute too soon.
In an extraordinary few hours on Tuesday night, the Albanese government and the Treasury leadership of Jim Chalmers just might have transformed the spirit of Australia’s green property industry.
After the lost decade and now well into the “defining decade” it’s none too soon.
A cavalcade of reaction statements from all the usual green, property and ESG focused groups – some we’d never heard from before – rolled into the news desk. There was not much of this content mentioned in the mainstream news, but in this patch, every fine detail was listed and much scrutinised, for the wins and the fails. Because of course there were fails.
On the positive, it’s not so much the magnitude of the investments that resonated and sparked effusive congratulations but the gestures of at least some concrete support across an enormous spread of sectors.
There was a sense that so many hardworking, committed and passionate people had been seen, heard, acknowledged, and at long last addressed.
From energy efficiency for homes, to clean energy support and even a nod to the new-ish nature positive movement with a $214 million injection of support.
Some amounts were even smaller – just $1.6 million to co?fund the development of an Australian sustainable finance taxonomy and $8.3 million over four years to develop and issue sovereign green bonds.
There is even investment into urban development – perhaps the feds have seen that the climate damage endured by our citizens needs big-picture national solutions.
But the point is that these diverse sectors, which are all equal firsts in the transition we have to have, were given a leg up to keep on with the fight.
On reflection, adding to this piece on Wednesday morning, it’s almost like – shock of shocks – the government gets that our fight for the planet has to be “everything, everywhere, all at once”. As if it’s heard the final warning from UN Secretary-General Antonio Guterres who made that clarion call so recently.
It’s the term that Green Building Council of Australia chief executive Davina Rooney picked up and re-broadcast and that we think needs to be the big thought piece that drives all our action for the next six years before as we hurtle towards 2030. (Just six years to go in a minute.)
Of the long stream of pinch-me-to-make-sure-I’m-not-dreaming list of congratulations, it was the detailed statement from the GBCA that stood out, in a recognition that this Australia governemnt has at least heard the “everything” imperative.
Rooney nailed the sentiment in her usual succinct and measured way: “We have spent 20 years championing a greener, healthier, more resilient built environment – and this is the response we have been waiting for.”
Others congratulated and celebrated too.
Saul Griffith from Rewiring Australia said it was Australia’s first electrification budget.
The Energy Efficiency Council said the $2.9 billion for energy efficiency, electrification and business decarbonisation, “supercharges efforts to lower emissions and cut energy bills by driving landmark energy performance improvements right across the economy”.
The announcements include $1.3 billion to improve the energy performance of residential buildings, with $1 billion for the Clean Energy Finance Corporation and $300 million to upgrade social and public housing in partnership.
Yes, we need more, much more and the social housing providers like PowerHousing Australia made that clear.
There was a huge fail on alleviating poverty and the Greens spared no feelings in their skewering of the neglect of those below the breadline. This is deeply perplexing in a government that holds itself out as caring and wanting to leave no-one behind.
Greenpeace noted at that “at a time of climate and cost of living crisis, gas and oil companies are still in receipt of billions of dollars worth of subsidies”. Another fail.
The Australian Conservation Foundation agreed on the missed opportunities to stem waste on fossil fuel subsidies, including $6.7million for a Future Gas Strategy and on submarines.
But for climate and sustainability, an industry that’s taken upon itself the almighty task of saving this beautiful planet against all the odds, it feels like the Albanese government has planted a rock. An Uluru mountain of a rock, deep into the bones of the sustainability movement that will not be easily dismantled now, by whatever coal-loving government might follow.
As Rooney said: “As we get deeper into what Treasurer Chalmers has called the ‘defining decade’, the government is making a definitive commitment across a range of measures, that will help Australia to tackle the complex challenges of a changing climate.”
Following are highlights of the many statements that came through on Tuesday night.
The Green Building Council of Australia
The Albanese government has allocated billions in tonight’s budget to new measures that will supercharge the net zero transition and build a resilient, sustainable nation.
The Green Building Council of Australia (GBCA) has applauded the “ambition and vision” of the Albanese government for a budget that aims to strike the right balance between short- and long-term challenges.
“We have spent 20 years championing a greener, healthier, more resilient built environment – and this is the response we have been waiting for,” says the GBCA’s chief executive, Davina Rooney.
Energy efficiency
“Billions in direct energy bill relief will ease the cost-of-living crisis in the short-term. But the Australian Government is also pouring billions into investments that drive down energy costs in the long-term,” Ms Rooney said.
Treasurer Chalmers announced $3 billion in direct energy bill relief for eligible households and small businesses.
But alongside this, funding of $1.3 billion will establish the Household Energy Upgrades Fund which will support home upgrades that improve energy performance and save energy.
This includes $1 billion for the Clean Energy Finance Corporation to provide low-cost loans for double?glazing, solar panels and other improvements that will improve the energy efficiency of homes.
“The Treasurer noted energy efficiency of Australian homes is a ‘big part’ of the energy affordability story. As the National Energy Performance Strategy takes shape, measures like these play a mission critical role in cutting carbon and energy bills as well as creating healthier, more comfortable homes for Australians.”
The Budget allocates $4 billion to further the Australian government’s ambition to be an “renewable energy superpower”, bringing the total investment to more than $40 billion. This includes funding for green industries and manufacturing, as well as investment for firmed-up renewable energy projects.
The budget also allocates more than $36 million over four years to expand and modernise the Greenhouse and Energy Minimum Standards program and the Nationwide House Energy Rating scheme (NatHERS).
“We commend this step towards a single national rating for home energy performance. Creating a single national rating to empower owners, buyers and renters was a key recommendation in our recent report, Every Building Counts.”
Net Zero Authority
A new Net Zero Authority, announced the week before the Budget, will be kick-started with $83.2 million over four years. The authority will support workers in emissions-intensive sectors to access new employment and skills, and will coordinate government programs to help regions and communities create new clean energy industries.
“As we move towards net zero at speed, we must achieve a ‘just transition’. The investment in the Net Zero Authority demonstrates the Albanese Government’s determination to ensure the clean energy transition leaves no one behind,” Ms Rooney said.
Sustainable Urban Development
A national approach to sustainable urban development, backed by $687.4 million over six years, has also been welcomed by the GBCA.
“We are particularly pleased to see nearly $160 million over four years to establish the Urban Precincts and Partnerships Program. This collaborative approach will help communities identify and respond to place-based priorities,” Ms Rooney said.
An additional $11 million over four years will establish the Cities and Suburbs Unit within the Department of Infrastructure, Transport, Regional Development, Communications and the Arts to deliver the National Urban Policy and the regular State of Cities report.
“This is a long-awaited reboot of the Major Cities Unit led by the Prime Minister in his former role as Infrastructure Minister.”
Sustainable finance
The government has allocated $8.3 million over four years to develop and issue sovereign green bonds, $1.6 million to co?fund the development of an Australian sustainable finance taxonomy, and $4.3 million to bolster ASIC’s enforcement action against greenwashing.
“Demand for green finance is growing rapidly. These measures will help to establish a common language for sustainable finance and make it easier for investors to back climate-ready buildings,” Ms Rooney said.
Green Star leadership
The government will extend the clean building managed investment trust (MIT) withholding tax concession to data centres and warehouses – and will raise the minimum energy efficiency requirements for existing and new clean buildings to a 6 Star Green Star or 6 Star NABERS.
“This decision will support investment in energy efficient commercial buildings, and in turn, reduce energy usage and energy bills for commercial tenants,” Ms Rooney said.
Social infrastructure
Significant funds have been earmarked for social infrastructure investment, including $3.4 billion for the Brisbane 2032 Olympic and Paralympic Games.
“Olympic Games leave legacies that echo for generations. Green Star was embedded into Brisbane’s bid with a promise that all new vertical infrastructure and significant upgrades would target 6 Star Green Star. This commitment will not only support a ‘climate positive Games’. It will also provide further impetus for green social infrastructure.”
Prioritising resilience and nature
There is also $214 million for a ‘Nature Positive Plan’ and $28 million for Australia’s first National Climate Risk Assessment and a National Adaptation Plan.
“Making our buildings and communities resilient and nature positive are two critical areas of focus for GBCA and for the development of the Green Star rating tools,” Ms Rooney said.
A transformational agenda
“The Australian government has a huge agenda ahead to transform the nation’s economy. This budget lays a strong foundation and we look forward to continuing to work with the government to support this visionary and ambitious agenda.
“As we get deeper into what Treasurer Chalmers has called the ‘defining decade’, the government is making a definitive commitment across a range of measures, ,that will help Australia to tackle the complex challenges of a changing climate and take advantage of the many opportunities for our economy to grow,” Ms Rooney concludes.
Rewiring Australia
New spending of $1.6 billion is Australia’s first “electrification budget”, which will simultaneously address two of Australia’s biggest challenges: reducing cost of living pressure and cutting greenhouse emissions.
This includes: $300 million for electrification and energy performance upgrades for social housing and $1 billion in new funding for the Clean Energy Finance Corporation to offer solar, storage and electric upgrade finance to more than 170,000 homes.
This is in addition to the recent announcement of a new 20 per cent tax deduction for small businesses that invest in batteries and other electrical devices that is worth about $314 million over the forward estimates.
Rewiring Australia co-founder and chief scientist, Dr Saul Griffith, said this budget is a profound reset of climate and energy policy after a lost decade under the previous government.
“This is Australia’s first electrification budget. It positions us to become a world leader in the efficient electric energy system of the future. It demonstrates federal ministers have worked hard to start the massive shift towards a new energy paradigm across the economy.
“The electrification budget builds on Australia’s love affair with rooftop solar. It will help households to realise cost savings from substituting expensive gas machines for clean, electric alternatives. Tonight’s investment allows us to use abundant Aussie wind and sunshine to power more of our driving, cooking and heating, simultaneously slashing energy bills and carbon emissions.
Solar Citizens
The federal budget commitment to providing energy bill relief for millions of Australians who urgently need support, in particular long-term energy bill relief through low interest loans for solar and energy saving upgrades is welcomed.
“We also welcome the $300 million to help people in social housing benefit from energy performance upgrades. The best way to help people in social housing to lock in lower bills for good is through clean energy upgrades like efficiency and adding rooftop solar to social housing.
“We call on state governments to match this funding dollar-for-dollar so everyone in social housing can save with both solar and other energy upgrades.
“Electrification of households requires more cheap, clean, renewable energy, and just last week Energy Minister Chris Bowen stated we urgently need 60 million more household solar panels installed on Australian homes in the next seven years. To do this, we need solar on social housing and on rentals.”
Mission Australia
- The federal budget takes small positive steps but not enough to end housing and homelessness emergency
- Amidst cost-of-living pressures, the government’s refusal to increase JobSeeker to at least $76 daily will force more people into poverty and homelessness
- Mission Australia delighted to see measures to scale up place-based community-led work to strengthen communities
- $732.9M to boost NDIS effectiveness and support participant outcomes welcomed.
Mission Australia’s CEO Sharon Callister said: “The 2023-24 Federal budget contains a number of positive but relatively small-scale measures to support the people served by Mission Australia and other community services organisations.
“We acknowledge the government’s intent to ease some of the pressures for people who are doing it tough, and their genuine discussions with the community sector.
“However, the lack of a serious move to address poverty by making substantial increases to JobSeeker and other income support payments is a sharp and continuing disappointment.”
“Additionally, there is no new initiative of scale to respond to the current devastating housing emergency – nothing to stop more and more people being pushed into homelessness across the country.
Farmers for Climate Action
The announcement of $310 million Small Business Energy Incentive, which will enable farm businesses to claim tax incentives for their investments in on-farm batteries and electrification is welcomed.
CEO Dr Fiona Davis said, “Batteries currently come with 10-year payoff periods and five-year warranties, and until this is fixed, farmers are unlikely to invest in them.”
Dr Davis noted the $38.3 million for ABARES to improve data collection and low emission technology on agriculture, and $40.7 million over five years for farm extension officers, but noted this funding was repurposed from existing funds.
“Farmers for Climate Action also welcomes the announcement of a National Net Zero Authority, and cautions that this good idea will only work if rural and regional voices are truly heard.
The Climate and Health Alliance
Funding welcomed for action on climate in 2023/2024 Commonwealth Budget, but more is needed to unlock the health benefits associated with climate action.
CEO of the Climate and Health Alliance, Roland Sapsford, said, “We commend the substantial investment in social housing to improve energy performance, which will improve the health of residents without increasing carbon emissions.
“We also commend the Commonwealth on its commitment to fund the establishment of a National Net Zero Authority and the Australian Centre for Disease Control in this year’s budget.
“We are, however, concerned that the budget does not provide much needed resources for the implementation of the National Health and Climate Strategy, expected later this year.”
Australian Constructors Association
Funding to establish the National Construction Industry Forum (NCIF) is welcomed.
Australian Constructors Association CEO Jon Davies said the NCIF will provide a tripartite forum to transform the construction industry, as other sectors have, so we can emerge as a worldwide leader and industry of choice for future generations of workers.
“The NCIF marks a significant step forward for the construction industry, enabling greater collaboration and cooperation amongst industry stakeholders to drive positive change,” said Mr Davies.
“But to address the industry’s challenges, government, industry and unions must leave behind the baggage of history.
“At the Future of Construction Summit last week, the Australian Constructors Association announced a pledge to improve the culture of the construction by embedding flexibility on all member projects, achieving the WGEA Employer of Choice for Gender Equality citation across 75 per cent of members by 2028 and attracting a new wave of talent to sustain the industry.”
Greenpeace Australia Pacific
“At a time of climate and cost of living crisis, gas and oil companies are still in receipt of billions of dollars worth of subsidies”.
Investment in renewable energy and household electrification is welcomed, but the government must not let the gas industry undermine progress.
“Using its surplus and its mandate from Australians at the recent ‘climate election’, there have been some strong and welcome announcements made surrounding this budget, including more than $1.6 billion for energy saving and electrification upgrades for households and small businesses,” Greenpeace Australia Pacific’s Head of Strategy and Advocacy Glenn Walker said today.
“However, both Labor’s cost-of-living measures and investments in climate action are being undermined by the gas industry, which is ripping off Australian families and accelerating the climate crisis.
“It’s staggering that at a time of climate and cost of living crisis, gas and oil companies are still in receipt of billions of dollars worth of subsidies. These subsidies could be better spent on a transition away from climate-wrecking gas.
“We are surprised and concerned to learn of the hovernment’s newly announced ‘Future Gas Strategy’ – the gas strategy we need is to get off gas as quickly as possible, and phase out gas exports and replace them with clean energy.”
Greenpeace welcomed the $355 m investment over four years in national parks, but Mr Walker cautioned, “If we’re to end extinctions in Australia, we must go further with more funding and deal directly with Australia’s deforestation crisis.”
The Greens
Labor’s second Budget is a betrayal of people who were promised that no one would be left behind.
This Budget was an opportunity to lift people out of poverty and Labor didn’t take it.
Budgets are about choices.
During a worsening cost of living crisis, the government is choosing to continue with Stage 3 Tax Cuts, nuclear submarines, and handouts for wealthy property investors and fossil fuel corporations while leaving people below the poverty line, cutting the NDIS and increasing student debt by $6 billion dollars over the next two years.
A fundamental job of government is to make sure people have the basics they need to live life with dignity.
With rents soaring and everyday costs rising, tonight Labor’s budget has just a $1.12 a day increase to Commonwealth Rent Assistance and $2.85 a day extra for income support recipients. Labor is leaving people in poverty.
We need a freeze on rent increases now, we need to wipe student debt and to lift income support above the poverty line. More on the budget here.
Labor has the power to lift people out of poverty, they’ve just chosen not to use it.
Labor told us tonight they had to make “hard choices” to balance the budget. But they’re just pushing the hard choices onto people doing it tough. Forcing millions of people to choose between paying the rent, having food in the fridge or accessing medical treatment.
At the last election, voters wanted a government that would tackle the inequality crisis. They’re still waiting.
Labor’s surplus of $4.2 billion dollars will be no comfort for those who are trying to keep their head above water. You can’t pay rent with a surplus. Every dollar of surplus is a dollar not spent lifting people out of poverty.
Meanwhile, gas corporations making obscene profits while cooking the planet pay next to nothing. Labor is raising more from lifting student debt than they are from their changes to the gas tax.
There’s simply no excuse not to deliver the housing, health and income support people are crying out for – especially when they’re spending four times more on stage 3 tax cuts for the wealthy than they are on cost of living relief.
The Energy Efficiency Council
The Albanese government’s ushering in a new era of energy efficiency in Australia is to be congratulated.
With almost $2.9 billion in measures for energy efficiency, electrification and business decarbonisation, this budget supercharges efforts to lower emissions and cut energy bills by driving landmark energy performance improvements right across the economy.
Lower energy bills and healthy, comfortable homes
Tonight’s budget includes $1.3 billion to improve the energy performance of residential buildings, beginning the journey toward lower energy bills and a healthy, comfortable, resilient home for every Australian. This package includes:
- $1 billion for the Clean Energy Finance Corporation (CEFC) to upgrade the energy performance of homes
- $300 million to upgrade social and public housing in partnership with states and territories.
“This is a one-two punch to high energy bills,” said EEC CEO Luke Menzel.
“Fixing the energy performance of social housing is one of the best things we can do to shield the most vulnerable in our community from needlessly high energy bills.
“And the government has tasked the CEFC with its next great challenge: putting comfortable, healthy homes that are affordable to run within reach for average Australian families.”
“The CEFC has been partnering with banks to provide low cost finance for energy performance improvements for a while, but these programs have been relatively small. This $1 billion dollar investment supercharges that work, and not a moment too soon.
“To reach net zero by 2050, millions of Australian homes need upgrades to boost energy efficiency and electrify appliances. This is a huge undertaking, and today’s budget commitment is a great start.”
The government has also committed to helping householders understand the energy performance of their home through funding an expansion of the Nationwide House Energy Rating System, as well as expanding the Greenhouse and Energy Minimum Standards program.
The EEC also commended the government on its commitment to decarbonising and improving the energy performance of businesses small and large. The new $310 million Small Business Energy Incentive provides a bonus tax incentive to small businesses to upgrade their energy performance, and provides meaningful help for small and medium businesses continuing to struggle with high energy prices.
The government has also committed $1.25 billion to decarbonising Australian industry through the Powering the Regions Fund, complementing the reforms to the Safeguard Mechanism with support for industry to transition.
Mr Menzel said this Budget fires the starters gun on the race to achieve net zero by 2050.
“Energy efficiency helps address some of the biggest challenges we face as a nation: Achieving our emissions reduction targets while lowering our energy bills.”
“It’s great to see the government recognise that, and back-in businesses that want to make smart investments to cut their energy use and drive up productivity.”
The budget marks the most significant investment in energy performance in years. It represents a new dawn for energy efficiency, energy management and electrification
The budget marks the most significant investment in energy performance in years. It represents a new dawn for energy efficiency, energy management and electrification, as well as a new, collaborative approach which will help ensure we make the most of our nation’s abundant renewable energy resources.
Mr Menzel congratulated the government on its engagement with stakeholders to deliver strong outcomes through its forthcoming National Energy Performance Strategy.
“The EEC has worked closely with the government to highlight the benefits of improved energy performance. Tonight’s measures, which reflect a number of recommendations put forward by the EEC and our partners, build momentum for a step change in Australia’s energy performance.
“This time last year, Australia was ranked last in the developed world for policy and practice in energy performance. Tonight’s Budget demonstrated we have a government committed to ensuring that never happens again.”
Queensland Conservation Council Comment
Director Dave Copeman said: “The energy rebate and low-cost loans for energy efficiency in this federal budget are welcome steps towards easing the pressure on households struggling with rising costs of fossil-fuel generated power.
“While this immediate relief is crucial, if we want to permanently lower power prices and keep our communities safe, we must fast-track investment in renewable energy.
“Renewable energy can tackle both the cost of living and climate crises.
“The Queensland Conservation Council urges the Queensland government to step up its part in delivering energy bill relief for people in social housing, match the Federal Government’s $300 million for energy improvements and focus on solar.
“We need Queensland government-backed interest-free loans and grants for small-scale solar and storage and increased support for the rollout of solar rooftops on private rental properties.
“We’re also calling for more publicly-owned renewable energy projects to bring down power bills and improve reliability.
The Property Council of Australia
The strong, cyclical economic results in the federal budget were welcomes but the government must match its targeted approach to migration with the same focus on housing investment and better planning across the country.
The budget highlighted the strength of net overseas migration (NOM) over the next five years, amounting to almost 1.5 million people, but also the extent of the housing supply crisis in Australia, with dwelling investment levels predicted to drop significantly, revised down from a forecast minus one per cent growth to minus 3.5 per cent in 2023/24.
The Property Council welcomed the $1.3 billion dollar investment in home energy efficiency through the Household Energy Upgrade Fund outlined in the budget, as well as the focus on cities through programs for investments in suburbs and precincts alongside a National Urban Policy to help better plan our cities.
Property Council Chief Executive Mike Zorbas said the government’s decision to increase skilled migration was a positive one, but warned the issue of housing lingers as a major handbrake on the necessary flow of skilled migrants and the quality of life for all Australians.
“Reviewing the budget: growing our national skills base to keep the economy firing, tick, build-to-rent housing, tick, cities policy, tick, energy efficiency incentives, tick. Investment in housing, question mark,” Mr Zorbas said.
“Skilled migrants have been central to Australia’s economic success story for generations, filling critical job vacancies in important sectors, and making valuable contributions both economically and socially.
“The population growth outlined in this budget highlights the need for faster and better housing delivery and planning across our cities. The Senate should strongly consider passing the government’s Housing Australia Future Fund this week to end current delays in delivering 40,000 new social and affordable homes across the nation.
“We also note the game-changing investment in the energy performance of Australian homes, which will help households slash energy bills and help the country reach its net zero goals,” he said.
Mr Zorbas commended the government for lowering the Managed Investment Trust withholding tax rate to 15 per cent for build-to-rent housing investment, in line with investment in other property asset classes, and raising depreciation from 2.5 per cent to 4 per cent, from 1 July 2024. This measure should be brought forward to 1 January 2024. The next public policy improvement will be a tax rate of 10 per cent for Affordable ‘Key Worker’ Housing (rent at 20 per cent below market).
“The government’s decision to level the tax playing field for build-to-rent projects is a significant one, unlocking up to 150,000 new homes to relieve pressure in the rental market,” Mr Zorbas said.
“Build-to-rent housing, like purpose-built student accommodation and retirement living, is an important part of the national housing equation and provides tenants with long-term security of tenure, superior amenities, and professionally managed properties,” he said.
Mr Zorbas said the government’s decision to boost Commonwealth Rent Assistance was a wise move, which over coming years should be extended to benefit more people in retirement villages. In contrast, recently aired proposals to introduce rent capping would directly reduce the provision of new housing stock. He also noted the need to boost student accommodation.
“The government has made changes to international student visa settings and employment rules, acknowledging how critical international students are to the economy, but we need to explore new measures to help grow the supply of purpose-built student accommodation to relieve pressure on the private rental market,” Mr Zorbas said.
Mr Zorbas cautioned that 1 July 2023 changes to Thin Capitalisation rules, in their current form, will unintentionally reduce much needed investment in new Australian housing. He flagged that the recent Treasury consultation process had exposed significant and unintended flaws in the proposed operation of the legislation and noted the property industry was looking forward to conclusive discussions with the government to preserve increased investment into much needed new housing in capital and regional cities across Australia.
“The unintended consequences of changes to the ‘thin capitalisation’ investment rules risk undoing the good work that the Treasurer and Housing Minister are seeking to deliver on housing, including hampering the emerging build-to-rent asset class which is necessarily reliant on capital partnering and third-party construction financing,” Mr Zorbas said.
The Climate Council
The budget’s climate funding was a warm up lap in history’s most important race’.
While the budget contains welcome temporary power bill relief and measures for some households and businesses to tap into renewables, it doesn’t meet the scale of the climate emergency Australia faces.
Amanda McKenzie, CEO of the Climate Council said: “The measures in this budget for cost of living are, for the most part, temporary. This is a missed opportunity to permanently lower people’s power bills. To meet the climate challenge head on, Australia needs to urgently unlock the most affordable energy source available, renewables.
“Sure, this budget provides renewables assistance to 170,000 households. But when you consider the critical challenge of electrifying everything with renewable power, backed with storage, for 10.8 million households, that barely gets us off the starting blocks.
“The Labor Government has demonstrated in this budget that they want to support Australians who are struggling. Climate change makes every Australian vulnerable, so the scale of investment on climate action needs to match the task ahead of us.
“We can’t settle for a slow jog when the climate crisis calls for a sprint. Climate change is already reshaping our world, the government needs to fundamentally re-shape the budget to tackle it.”
PowerHousing Australia
The Federal Budget today shed light on the growing challenge of housing a population that is growing at historically elevated net overseas migration levels as the supply of new dwellings is forecast to decline significantly beyond previous estimates.
With NOM forecasts for 2022-23 revised up from 180,000 (May 2022),and 235,000 (Oct 2022) in previous Budget’s projections to 400,000 (NOM) today there is a compounding forecast that can only add more pressure on the Australian housing market. Coupled with a downgrading of the FY2023 and FY2024 dwelling investment forecasts here may be further immediate pressure on housing affordability.
New measures such as an increase to Commonwealth Rent Assistance, a $2 billion increase in the NHFIC Bond Aggregator cap to lend to community housing, Build to Rent incentivised to further grow the investment into housing and targeted support for at need groups are welcomed to provide reprieve. The key element to be delivered in the forward estimates remain as the 30,000 home Housing Australia Future Fund with $125m in new housing lost every quarter that the program is stalled.
Nicholas Proud, CEO of Peak representative body for PowerHousing Australia said today “These new housing and cost of living measures will support Australian families when coupled with the key 2022 election 30,000 home Housing Australia Future Fund (HAFF) and Housing Australia policies to support the growing number of Australians desperately needing greater affordability.
“Whilst there are additional measures in this Federal Budget, the current Housing Australia and HAFF legislative package needs to be passed to provide the desperately needed national focus and attention to tackle the national housing crisis.
“Australia continues to be confronted by a lack of focus on housing which means that a doubling of the forecast net overseas migration in just one year can happen without forewarning or a plan that Housing Australia and the Nationals Housing Supply and Affordability Council would otherwise provide.
“Those facing housing pressures would not expect these new elements and the stalled HAFF to be the only measures to deal with the whole housing crisis, but they would expect parliament to get on with the job to pass this legislation, create Housing Australia and the Nationals Housing Supply and Affordability Council as an opening salvo in the war on housing affordability.
“Australians want leadership on housing from their Parliamentarians and the passing of other Housing Australia and HAFF package, will allow future Federal Budgets to invest further in measures with a plan rather than the ad-hoc approach applied nationally to housing in the past”, said Mr Proud.
Engineers Australia
Engineers Australia CEO Romilly Madew said:
“The budget comes at a critical juncture for the nation. Australia faces a tricky geopolitical backdrop, tough economic conditions, a skills deficit and pressing climate change challenges. All are profound issues, and all intersect with the engineering profession.
“Over the past two years, engineering vacancies have increased by 80 per cent nationally.
“It is pleasing to see the government’s commitment to skills and increasing the number of women in male dominated industries. The defence, economic and climate challenges facing the nation and outlined will require an engineering workforce equipped with the complex skills to deliver outcomes. This includes for AUKUS, Australian manufacturing and shoring up sovereign capability, rewiring Australia, the national energy transition, net zero emissions targets and delivering on infrastructure projects.
“We welcome the budget focus on developing engineering skills locally through greater emphasis on Australia’s education system (primary, secondary and tertiary education).
“Reforming the migration program and easing migration pressures to increase the numbers of skilled migrant engineers arriving in Australia is also a positive step. Due to significant challenges in the supply of domestically trained engineers, Australia’s migration program will continue to be a significant contributor to Australia’s engineering capability making investment in reforming the program critical.
Clean energy transition
“Engineers Australia supports the budget initiative to legislate a national Net Zero Authority.”
“To remain viable, the energy system must primarily exist for the well-being of Australians and put people at the centre of decision-making processes. The Authority’s work will also help to maintain the social licence needed to achieve the energy transition.
Infrastructure
“Engineers Australia supports the budget investment in infrastructure which includes a focus on ensuring projects of national value and significance can be delivered.
“Government’s review of its multibillion-dollar Infrastructure Investment Program will also provide an opportunity to target investment to ensure best value for money is achieved. This is critical to helping ensure spending doesn’t further fuel current economic challenges.
“Australia’s construction sector is already at breaking point, rising materials costs and labour shortages has caused budgets to blow out and project slippage. We hope this Budget and review will give due consideration to changing consumer behaviour and economic priorities.”
Australian Conservation Foundation
“The Albanese government is making good, solid investments in the clean energy revolution with funds to build transmission infrastructure, attract clean capital to Australia and help workers through the energy transition,” said ACF’s CEO Kelly O’Shanassy.
“ACF welcomes the $2bn Hydrogen Headstart program to accelerate the development of Australia’s clean export industry.
“We also welcome the funding for climate adaptation and disaster relief, which will help communities affected by extreme weather events in Australia and through the Pacific.
“Making offshore gas companies pay more tax is a step in right direction, but further changes are needed so Australians get a fair share of the gas industry’s windfall profits.
“The investment in energy efficient homes is smart because it eases cost-of-living pressures for households every single month.
“While there are positive announcements on nature – including funding to reform our failed national environment law and a new national EPA – the government’s approach to the biodiversity crisis could best be described as timid.
“Disappointingly, spending on a variety of initiatives, including protection and conservation of the environment and pollution abatement, are projected to decrease to 2026-27.
“Experts say $2bn a year is needed to restore Australia’s degraded ecosystems and help threatened species recover, but this budget acts like the biodiversity crisis isn’t a real crisis.
“Yet, in the last 12 months glossy black cockatoos and pink cockatoos have joined greater gliders, gang gang cockatoos and dozens of other birds, animals and plants on the threatened species list. Even koalas are now endangered in Queensland, NSW and the ACT.
“Half (49.3%) of Australia’s GDP is directly dependent on nature, so investing in its health is good for the budget bottom line – not to mention good for physical and mental health.
“While $2bn a year over 30 years to protect nature might sound like a lot, the government is prepared to spend six times more on nuclear submarines over the same period.
“The really ugly part of this budget is the continuation of subsidies to big, multinational companies encouraging them to use more coal, oil and gas.
“The fuel tax credit scheme will cost Australians $9.6bn in the next year and $41abn over the forward estimates.”
Good
$83.2m over four years for National Net Zero Authority
$1.6bn to improve energy efficiency, include in social housing
Establishment of the Capacity Investment Scheme for clean energy and storage
$310m in tax relief for small businesses to electrify premises and appliances, as negotiated by Greens and Labor
$80m over four years to support supply of cheap, clean and reliable energy across Australia
$400m added to the $1.9bn Powering the Regions Fund for clean energy growth
$61.4m over four years for the National Reconstruction Fund Corporation
$121m to establish a national EPA and $51.5m to establish Environment Information Aust
$302.1m over five years to support a climate-smart sustainable agricultural sector
$236m over 10 years to remediate high priority flood warning infrastructure
$14.2m over four years to support sustainable finance agenda, including $8.3m for sovereign green bond program and $4.3m to police greenwashing
$150m to improve the quality of water flowing to the Great Barrier Reef
$355.1m over four years for National Parks, including Uluru and Kakadu
$118m in additional funding over six years to improve local waterways
$146.8m over four years towards the sustainability of the Murry-Darling (Basin)
$4.5m for establishing a roadmap to decommission for offshore petroleum
Bad
Approximately $50bn in fossil fuel subsidies, including $41bn for the notorious Fuel Tax Credit scheme over the forward estimates
$6.7m to deliver a Future Gas Strategy
$4.5bn over 10 years to support acquisition of nuclear submarines
Undisclosed funding allocation for ANSTO to develop a business case for a new facility to support Australia’s nuclear security science capability
$162m over seven years to continue the sub-optimal Kimba radioactive waste plan
Timid
Petroleum Resource Rent Tax reforms are a step in the right direction, but should go further
$28m over two years for National Climate Risk Assessment and National Adaptation Plan. No other funding for National Climate Adaptation program
A modest $20.9m over five years for initiatives to decarbonise transport and infrastructure, including $7.4m to develop fuel efficiency standards
$439.3m over five years to support programs that repair World Heritage Properties, restore Ramsar wetlands and conserve threatened species and habitats, when vastly more is needed
$7.7m for a Nature Repair Market, even though it’s unclear if linking ‘nature repair’ to the generation of offsets will facilitate the destruction of more existing wildlife habitat
Only $40.4m to support the continuation of Indigenous Rangers Biosecurity Program and $1.2m for five new Junior Ranger sites in Central Australia.
Impact Investing Australia
Budget initiatives to address entrenched social disadvantage through impact investment, including $100 million for a Commonwealth Outcomes Fund, an $11.6 million Social Enterprise Development Initiative, and $210 million expansion over four years to expand the Emerging Markets Impact Investment Fund were welcomed.