The federal government has revealed the details of its fourth economic stimulus package, to be worth a total of $680 million.
The ‘HomeBuilder’ package is focused on the construction sector, and offers tailored support to tradies and small businesses in the space.
Grants of $25,000 will be available for home renovations and new builds, in a bid to incentivise activity. But, there are restrictions.
The cash is available to individuals with an annual income of up to $125,000, and couples with an annual income of up to $200,000.
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New builds must have a final value of up to $750,000.
Those using the funding for renovations must spend at least $150,000, but less than $750,000.
The renovations must also only boost the value of the property up to $1.5 million.
The cash can only be used for properties occupied by the owners, and can’t be used for outside improvements, such as building pools, tennis courts, sheds or garages.
Federal funding is also expected to be offered to the New South Wales government, to bring forward the construction of the Western Sydney Airport metro train line, in a bid to create additional jobs.
The latest stimulus is intended to “fill a gap in the construction industry”, a government statement said.
The government anticipates it will create 140,000 jobs directly (less than the 380,000 first speculated), and up to one million indirectly.
Last week, Master Builders Australia called for a $13.1 billion building and construction stimulus package, and an industry taskforce to oversee implementation.
“Building and construction is shaping up to be one of the industries worst hit in the long term by the COVID-19 economic crisis. We know from previous downturns that it takes four times longer for our industry to recover than the rest of the economy,” chief executive Denita Wawn said in a statement at the time.
Following the latest announcement, Wawn called the package a “lifeline for an industry facing a valley of death”.
“It will mean more new homes, more small businesses and jobs are protected,” she said.
She estimated that the scheme could indeed ensure the viability of about 368,000 small businesses and self-employed tradies.
Elsewhere, however, the scheme has faced criticism, with many suggesting the cash would be better directed towards social housing.
Former Labor senator for New South Wales Doug Cameron called the HomeBuilder scheme “middle-class welfare”.
Shadow Minister for Home Affairs Kristina Keneally called out the lack of support for frontline workers and women and children affected by domestic violence.
Others simply noted that spending the $150,000 required in order to qualify is an unreasonable ask in a recession.
Couples earning $200,000 per year will be gifted $25,000 by Morrison for renovations.
Too many Australians are homeless, in rental stress and battling to feed and clothe their kids. Public and social housing needed not middle class welfare. https://t.co/Hu4Mt1LQvL
— Doug Cameron (@DougCameron51) June 3, 2020
Not a single dollar to construct, repair or maintain social housing, or to house mums and kids fleeing domestic violence, or for frontline workers in this crisis
This is a fraction of what housing industry say is needed. HomeBuilder is just another slogan https://t.co/7MYPR4UvNT
— Kristina Keneally (@KKeneally) June 3, 2020
Even when I had a mortgage I never had $150k spare to splash on a renovation. Housing in this country is a joke, a giant Ponzi scheme perpetuated by nonsense like #HomeBuilder that supports a few while others are squeezed in private rentals or on a years long waiting list 🏠
— Leah Dwyer (@Leah_CBR) June 3, 2020
But Wawn argues the construction industry is “simply too important” to go without support.
“It is the nation’s second-largest industry, provides the most full-time jobs, trains the most apprentices and is 98% made up of small businesses,” she said.