The business community can rightly feel that is has been sacrificed at the altar of Wayne Swan’s surplus, with the Government’s decision to kill off Labor’s much-hyped company tax cuts.
But if that decision wasn’t enough to get industry’s blood boiling, then there are plenty of other spending cuts to get specific sectors hot under the collar.
Tourism, the property sector and the wine sector are among those that have been hit hard. To find out what’s happened to your sector, you can’t miss SmartCompany’s traditional post-budget sector-by-sector guide.
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Advertising and marketing
The marketing sector probably still wakes in fright remembering the budget of a few years ago when the Do Not Call Register for businesses was announced (only to be later scrapped). There were no such surprises in this budget, but little joy either. The only thing the sector can look forward to is the tick over $36 million that the Government will spend on an information campaign to explain the household assistance to be received under the carbon tax.
This is another sector with very little to show from the budget. On the plus side, there is just under $20 million for continued drought assistance payments and over $120 million for biosecurity operations. On the negative side, changes to agricultural production levies are set to raise just over $8 million over the next four years.
Construction and engineering
As always, the Government did find money for some large infrastructure projects which will benefit the construction and engineering sectors. These include the Pacific Highway upgrade, worth almost $6 billion over the next four years, a new transport terminal in Moorebank in Western Sydney, worth more than $700 million, and $1.4 billion for the ongoing Roads to Recovery program. Most other existing infrastructure programs will be continued.
Financial services and insurance
The Government’s attack on super tax concessions for those earnings over $300,000 represents something of a blow to the financial services and insurance sector, as do plans to defer contribution cap increases for older Australians with less than $500,000 in their super balance. The financial services sector watchdog ASIC received a strong funding boost to help pay for market supervision and the implementation of the Future of Financial Advice reforms, while there was also a couple of million to oversee the introduction of the SuperStream reforms.
Health and pharmaceuticals
The health sector was one of the big winners out of this Budget. There was over $2 billion over the next four years to fund the first stage of the National Disability Insurance Scheme, and almost $1 billion for a long-promised dental health initiative that will see dental waiting lists cut and more dentists attracted to Australia. As announced prior to the Budget, there was also almost $2 billon in aged care funding, including money to fund care in the home and cash to address the workforce pressures in the rapidly growing sector.
There are a number of smaller programs around digital technology spread out across various portfolios, such as a major upgrade to the Australian Business Register, which will cost around $70 million over the next four years, and a $2.4 million project to help show museums how they will be able to take advantage of the NBN.
Internet and telecommunications
With the NBN coming, does this sector need anything else? They’re not going to get it from Labor, so all eyes will be on the Coalition’s NBN alternative policies.
The establishment of a $30 million Manufacturing Technology Innovation Centre will no doubt please Australia’s struggling sector. The Centre will use existing Enterprise Connect infrastructure to provide grants for projects, and will call on expert bodies to provide tailored advice to individual firms. The budget also confirmed Government assistance to Ford and GM Holden.
Australia’s publicly owned media institutions, SBS and the ABC, both received solid funding boosts. SBS will get just under $160 million for measures, including the establishment of a television channel for indigenous people, while the ABC gets fresh funding to improve radio services to the bush and $20 million for an online learning portal. Australia’s commercial television networks have also had their licence fee rebate extended to June 30 at a cost of $70 million.
Thousands of suburban accountants around Australia will be celebrating the Government’s decision to ditch a plan to allow taxpayers to make up to $1,500 worth of standard deductions on their tax returns. The move could have seen client numbers drop as the traditional tax time game of finding expenses to claim was for some no longer unnecessary. But, for a few years at least – and perhaps forever – that worry is gone.
The dumping of the Tax Breaks for Green Buildings program was tipped before the budget and Climate Change Minister Greg Combet followed through, saving just over $400 million by dumping the initiative. Combet said the program had been superseded by other initiatives and was no longer value for money. The beleaguered property sector would probably beg to differ.
Resources and energy
With the mining tax already hanging over its head, the mining sector would have been furious with the dumping of the company tax cut. But at least mooted cuts to diesel fuel rebates didn’t eventuate and the Government says the fly-in, fly-out workforce so crucial to the mining sector won’t be impacted by a fresh crackdown on the living away from home allowance.
There wasn’t even a hint that the Government could change the GST threshold for overseas purchases worth less than $1,000, but retailers will take some solace with the big handouts given to low income earners. A total of $4.9 billion will be handed to families through increases to family tax benefits, a new Schoolkids Bonus and an income support supplement – at least some of this should find its way to the hungry cash registers of retailers.
Tourism and transport
The budget was a really mixed bag for this sector. While a $61 million plan to attract Asian tourists was welcome, an $8 hike to the passenger movement charge that tourists are hit with when they enter Australia is not as helpful. Plans to decrease duty free allowances on tobacco products are also a minor blow for a sector that is struggling badly at present.