Community Newsletter

26 October, 2022

Labor's first budget has plenty of teal linings,
but more is required in key areas for equality, integrity and real climate action 

Economic uncertainty, rising energy prices, slowing growth, strained supply chains, inflation and rising interest rates are making for a sobering global economic outlook. 

We are not immune to these pressures with rapidly increasing interest rates, significant cost of living stress and recovery from natural disasters placing considerable pressures on Australians and our economy. Add to that the fiscal challenge of approaching a trillion dollars in gross debt, largely attributed to rising interest payments and escalating NDIS costs and the increasing risks of climate change and it is clear the Australian Government needs to do more substantial budget repair and face up to more significant structural policy changes in the next full budget. 

Whilst there is some alleviation of increasing costs of living for families with increases to child care subsidies and paid parental leave, these do not come into effect until mid-2023 and 2024. There is no immediate assistance to households, for example, by way of funding energy efficiency measures or subsidies for households to transition off gas. 

There are a lot of areas and details in the budget, my team and I have focussed on a few key areas below. You can view the full Budget here.

I would love to hear your thoughts and questions about the Budget. To best understand your views, please complete this survey that will take about two minutes: CLICK HERE.

Climate and Energy

Acting on climate change

• $42.6 million to restore the role of the Climate Change Authority
• $45.8 million towards clean energy trade partnerships and international climate engagement
• $20 billion to establish Rewiring the Nation to expand and modernise Australia’s electricity grids at lowest cost, unlocking new renewables and storage capacity and driving down power prices administered through the Clean Energy Finance Corporation who will also get an additional $50 million
• $500 million to reduce transport emissions through co-investment projects through the Australian Renewable Energy Agency, creation of hydrogen refuelling stations on highways and establishing a national electric vehicle charging network

Responding to risks of climate change

• $200 million per year for the Disaster Ready Fund on prevention and resilience initiatives 
• $22.6 million over 4 years to help reduce the cost of insurance in disaster prone communities

Comment:
In a welcome change, the Government has started to address the worsening impacts of climate change in this budget, investing in the transition as well as better funding for climate risks assessments, disaster relief and adaptation. 

There was a lot of focus on climate impacts throughout the budget, including a commitment that the Australian Public Service, excluding Security agencies, commit to net zero by 2030, and 75% of new Commonwealth fleet purchases be zero emissions by 2025. 

The Government has committed to new plans including a National Climate Risk Assessment, Health Risk of Climate Change, and the Climate Change Authority has had its funding boosted. Rewiring the Nation to better connect renewable power sources with the grid received $20 billion, Driving the Nation to accelerate uptake of zero emission vehicles has an investment of $500 million. 

There is over $200 million for 400 community batteries and I’ll be working to get at least one of these for Warringah. There’s also funding ($100 million) to establish solar banks for renters and strata blocks that find it difficult to access traditional solar. New Energy Apprenticeships get $95 million to fund 10,000 apprenticeships in the skills for the new green economy.

On climate adaptation, there is over $600 million over 3 years for the Disaster Ready Fund to help communities better prepare for climate risk. Unfortunately, this will be far from enough unless the Government increases its emissions reduction ambition. Current emissions reduction pledges are not sufficient to keep temperature rises under 2 degrees and will result in increased frequency and impact of natural disasters.

The Government is continuing to fund fossil fuels, with for example $1.9 billion committed for a gas and petrochemical zone in Darwin that will accelerate the Beetaloo Basin, increasing emissions and toxic pollutants. 

A continued investment in carbon capture and storage projects ($141 million) and $65.7 million to regulate the gas industry over 9 years will need further scrutiny and I will be keeping a close eye on these measures and how much public money continues to fund fossil fuels.

New Economy

Innovation and R&D

• $15 billion under the National Reconstruction Fund for a value adding industry and innovation fund
• $50.5 million for the Australian Critical Minerals Research and Development Hub to build valuable intellectual property in critical minerals processing
• Investment in priority industries to grow industrial base, diversify the economy and boost regional development 

Education/Jobs

• 10,000 New Energy Apprenticeship ($95.6 million over 9 years)
• 480,000 Vocational Education and Training places to address skills shortages
• 20,000 additional Commonwealth-supported places at universities and other higher education providers 
• Bursary boost of up to $40,000 over 4 years for high performing students to undertake teaching degrees 

Comment
There has been a clear shift in the language of the Government around the economy, with the new focus more clearly on innovation and the opportunities of a new economy rather than the heavy reliance on resources under the previous government. Predictably, there is a large focus on Jobs and Skills following the summit earlier this year with significant investment in education across the board. 

I welcome the investment in the new economy through the development of new energy apprenticeships and skills. Similarly, the announcement of 20,000 new Commonwealth-supported university places and 480,000 free TAFE places over 5 years is very welcome as we urgently need to develop the skills needed across the changing economic base. 

The value of high-quality teachers is recognised in the budget, with incentives for high-achieving students to take up jobs in the profession through bursaries of up to $40,000 over 4 years for what will essentially be free degrees. 

The Government is claiming $15 billion in investment over 7 years to establish the National Reconstruction Fund to support, diversify and transform Australian industry in 7 priority sectors: resources, agriculture, forestry and fisheries, transport, medical science, renewables and low emission technologies, defence capability and enabling capabilities. However, the detail of this investment is lacking. For example, there is no clear commitment to transition out of native forest logging, something that is urgently needed as it would secure carbon stocks, create new income streams and employment opportunities, limit fire risks to communities and save biodiversity from extinction. 

There is a significant focus on critical minerals rather than fossil fuels extraction for our resources sector but little detail on investment to boost manufacturing capacity or value-added production of those minerals in Australia. 

The Government has committed $9.6 million over 5 years to support the workforce transition to a clean energy economy. This funding is needed to support a new mentoring program to help train and support new energy apprentices, however, if we are serious about transitioning resource-dependent communities, a Fair Transition Fund and Agency should be established and a more substantial investment is required.

Housing
In this budget we see a Federal Government approaching housing supply as warranting a broader and more complex policy response, entailing smarter, new creative solutions and engaging new players in dealing with the challenges at hand. 

The Housing Accord holds out hope, particularly for the young and those on lower incomes, that the Federal Government sees home ownership and access to good quality housing as a key responsibility. 

Small Business
The Government is addressing rising energy costs for small businesses by committing $62.6 million to support small and medium sized businesses in improving their energy efficiency and reducing energy use.

There is also $15.1 million to extend the small business mental health and financial counselling programs, NewAccess for Small Business Owners and the Small Business Debt Helpline. This is welcome as many local businesses have been struggling with visa application delays. 

There is $42.2 million in funding to the Department of Home Affairs to accelerate visa processing and assist with skills and labour shortages through immigration. 

Environment

Protecting the environment

• $1.2 billion by 2030 to preserve and restore the Great Barrier Reef
• $224.5 million to support threatened native species
• 4.8 million hectares in additional protected areas
• $9.8 million to restore funding to the Environmental Defenders Office and Environmental Justice Australia

Comment
I welcome the $1.8 billion in funding to protect, restore and manage the natural environment, especially the $1.1 billion to improve land conservation efforts and biodiversity protection. 

Unfortunately, I feel the Government has underestimated the support needed to properly fund marine parks – $2.7 million a year is not much to manage Australia’s vast marine parks which make up over 30% of our oceans.  Locally, we have the Sydney Institute of Marine Sciences doing fantastic work and needing further funding. 

The Minister has made bold and ambitious statements around no new species extinction in Australia, however, a mere $224 million towards support for protected and threatened species is inadequate to achieve that goal without further meaningful reform. 

I would urge the Government to expedite the response to the Samuel Review as it looks like they are delaying action on changes to the Environmental Protection and Biodiversity Conservation Act until later next year.

Locally, there was no new funding for the restoration and conservation of the Sydney Harbour Federation Trust properties and land. I will be working with the Minister for the Environment and the Sydney Harbour Federation Trust to make sure this is a feature of the May Budget to ensure our key indigenous, military and culture heritage are not lost.

Integrity / Grants

• $262.6 million over 4 years from 2022–23 to establish and support the ongoing operation of the independent National Anti-Corruption Commission
• $83.0 million over 4 years from 2022–23 to restore funding for the Australian Broadcasting Corporation and $32 million over 4 years to expand the ABC's regional transmission 

Comment
I welcome the announcement of $262 million for the National Anti-Corruption Commission, however, question whether this will be enough to truly deliver on the substantial workload the NACC will undertake. Some experts believe funding of $100 million/year will be required so potentially the funding could run out after 2.6 years.

The ABC will see its funding restored to levels closer to where it should have been for the past 5 years since the pause on indexation. It is vital that we continue to invest in our national broadcaster and pursue greater diversity in the national media. 

I welcome the repeal of the Underwriting New Generation Infrastructure scheme which was seen as a mechanism to fund coal and gas projects under the last government and one I referred to the Auditor-General in the last Parliament.

Overall, the Government has committed to better fiscal discipline and stopping the rorting and misuse of grant and infrastructure announcements for political gain rather than merit and need, with cuts of $3.6 billion in outsourcing expenses on external contractors, consultancies, advertising, travel and legal expenses.

The Multinational Tax Integrity Package is set to raise around $1 billion over 4 years, while this is a welcome improvement to the bottom line, it is less than the $1.7 billion indicated in Labor’s pre-election promises. 

The Government must engage with the issue of multinational gas companies making massive profits and paying minimal tax to Australia. The Government is conducting a revision of the Petroleum Resource Rent Tax and I will continue to press them on the issue to ensure Australia receives reasonable revenue from Australian natural resources to fund the rapid electrification of households needed to reduce emissions and deliver up to $5,000 in much needed cost of living savings per year per household. 

Manly Life Saving Club has seen the clock start to tick on its Federal grant of $5 million. The Club now has 6 months to fill the contracts or the Government will cancel the grant that has been on the table for over 3 years. Either the NSW Government match the $5 million or the club will need to draw up designs for a $10 million build using the Federal grant and the Northern Beaches Council grant.

The Beaches Link Tunnel did not receive any funding and the Balgowlah Bypass funding was also put on hold. This is disappointing but not surprising since the State Government who lead on roads has put the project on hold themselves. Transport congestion remains an issue on key roads in Warringah so I will press for traffic solutions. 

Equality and Inclusion

• $4.7 billion for child care subsidy increases
• $531.6 million over 4 years to increase paid parental leave from 20 weeks to 26 weeks
• $100 million for women’s crisis accommodation
• $1.6 billion for long-term housing for women and children fleeing domestic and family violence, and older women on low incomes who are at risk of homelessness
• $65.3 million over 4 years for respectful relationships education to help prevent gender-based violence and keep children safe
• $10 billion investment in the Housing Australia Future Fund
• 30,000 affordable and social homes delivered via Housing Australia Future Fund Returns

Comment
Women’s participation in the workforce got a boost with gender equality and inclusion receiving huge investments in measures to address the gender pay gap and access to services. There were a variety of other measures introduced that will assist the most vulnerable with increases to support childcare, parental leave and housing affordability.

These commitments are good but households would be forgiven for wondering where the assistance is now to meet rising costs and inadequate supply. There is a clear failure to address the low rate of JobSeeker, leaving many below the poverty line. In opposition, the Government supported increases to social assistance but has failed to make any meaningful improvements in this budget.

Despite the forecast increase in social security spending ($33 billion) there is no real increase in the rate of JobSeeker or the pension. This is simply a reflection of the worsening employment market and the indexation of the rate to CPI. People on JobSeeker have been living well below the poverty line for too long, it is time that we did something about it. 

Childcare will be more affordable with an investment of $4.7 billion over 4 years in the Budget to increase the subsidy the Government gives parents to pay for child care. The subsidy will increase to a maximum rate of 90% of the Government’s benchmark fee for a first child of all families with a combined income under $530,000 pa. The subsidy was increased for second and subsequent children in the previous budget.

The Paid Parental Leave scheme will gradually improve over the next 3 years to expand to 26 weeks of leave shared between parents and a recalibration of the eligibility criteria so that it takes into account the couple’s shared income rather than solely the mother’s ($536 million).

There is a $42.5 million investment in improving workplaces through funding for the Respect@Work initiatives. I welcome the allocation of 500 community workers to support women fleeing domestic violence, and funding for housing initiatives for older women at risk of homelessness. 

The Government has confirmed its commitment to the Uluru Statement from the Heart Referendum process through a serious financial commitment of $235 million in the Voice to Parliament and the Referendum process. 

Finally, the Government announced the National Housing Accord which aims to build 1 million social and affordable homes over the next 5 years but there is little detail on how that will actually be achieved with the Government committing to build just 10,000 of those homes, leaving state governments and institutional investors to build the remaining 990,000 homes. 

Health

• $787.1 million over 4 years for cheaper medicines by decreasing the general patient co-payment for treatments on the Pharmaceutical Benefits Scheme from $42.50 to $30.00
• $203.7 million funding boost over two years to Australian schools to help address the adverse impacts of COVID-19 on student wellbeing
• $3.2 million to scope out an Australian Centre for Disease Control
• $2.5 billion for 24//7 Registered Nurses in Aged Care

Comment
Healthcare is a big focus of this year’s budget with huge increases to total funding for the NDIS which will reach $166.6 billion over the next 4 years, an increase of $8.8 billion. Aged Care will have registered nurses 24/7 at a cost of $2.5 billion. 

NDIS will continue to be supported but represents a hugely expanding portion of the budget and will need reform to remain affordable while still recognising the essential investment in social infrastructure that it is. 

Australia has one of the highest rates of the aged being cared for in specialist facilities. Sadly, there was no new money for Home Care Packages to assist with waiting lists.  We need to improve the value we place on care at home and increasing opportunities for the elderly to age in place. 

General Practice received a welcome and much needed $980 million but with the various mounting pressures on the health system generally, I anticipate that this will be a focus of the Government’s next budget in May. 

Wellbeing Framework/Measuring What Matters
Finally, I welcome the Government starting the conversation on ‘Measuring What Matters’, a commitment to exploring a progress and well-being reporting framework for Australia, and look forward to further consultation around this. The framework should ultimately help drive more long-term policy making, a key part of which should be a greater focus on early spending on preventative measures, to avoid fixing costly problems in the future.