Federal Budget 2018: what has been promised for the architecture, building, construction and design industries?
Australian Treasurer Scott Morrison handed down the 2018/19 Federal Budget in Parliament last month on May 8, with plenty of measures and initiatives impacting the building and construction industries.
Here are the pros and cons of this year’s Budget and what you need to know about the incoming measures.
Popular tax write-off scheme extended
The extension of the popular $20,000 immediate tax write-off scheme will continue to benefit small and medium operators in the construction and building industries.
This allows SMEs to continue to purchase new assets like computers, vehicles and machinery and claim it straight back on tax, but Master Builders Australia Hunter Regional Manager Len Blakeney said it would also likely trigger more small businesses to renovate their premises and employ more licenced builders, increasing the pool of projects and revenue available.
Master Builders Australia CEO Denita Wawn praised the tax write-off extension.
“Reducing the tax burden on households and small business is good for the economy and good for builders,” she said.
Infrastructure spending will actually go down
The Turnbull Government had talked big on infrastructure projects, but the recent budget shows that spending will actually decrease by $2 billion over the next four years.
The Federal Government announced a $75 billion spend on infrastructure over the next 10 years, including $24.5 billion in new funding. However, this includes a host of potential equity injections into projects like the Melbourne’s $5 billion airport rail — which takes the spending off the budget.
Infrastructure Partnerships Australia chief executive Adrian Dwyer said this was disappointing.
“At a time when our population is growing and our cities are more congested than ever, we need to see infrastructure dollars trending up, not down,” he said.
Reduced red tape in GST
Red tape in the GST reporting process has been reduced for small business, which will come as a relief to many. The 20 question Business Activity Statement GST worksheet has been replaced by a new version with just three questions.
The Federal Government’s National Partnership on Regulatory Reform was introduced in last year’s budget, but has largely stalled as Queensland, South Australia and Victoria still refuse to participate.
Training neglected in the Budget
All sectors of the building and construction industry wanted increased funding for Vocational Education and Training (VET) in the Budget, but that did not transpire. The Skilling Australians Fund (SAF) was introduced in last year’s budget in a bid to kickstart the VET sector, but no state has signed up for it to date.
The SAF only passed the Senate as legislation in early May this year and aims to funnel money into training Australians by imposing a levy on employers who hire migrant workers under a temporary skills visa.
While there were no new initiatives to assist with VET, funding of $152.8 million over four years from 2018-19 will continue to be provided to support Skills Service Organisations in developing and maintaining VET qualifications.
A ‘mixed bag’ of budget results for architects
Australian Institute of Architects’ National President Richard Kirk has describes the 2018 Federal Budget as a mixed bag for the industry, which has moved away from the centrepiece of housing affordability in last year’s Budget.
One particular initiative Mr Kirk praised was the National Housing and Homelessness Agreement, which will see $7 billion in housing funding and an additional $620 million for homelessness services rolled out over the next five years.
The $15 million budgeted over the next four years to assist export and trade will also benefit Australian architects who want to enhance their reputation overseas ahead of Expo 2020 in Dubai.
Mr Kirk was disappointed that a Federal Government architect was not implemented, with states and territories adopting these roles to great success. He was also disappointed that sustainability and energy efficiency were ‘largely ignored’.