By Jordan White | @JordanBWhite1
Treasurer Josh Frydenberg presented the 2021-22 Budget on Tuesday, a more optimistic and safer budget than last year’s, although the unparalleled debt still looms.
Focused on keeping cash flowing and the economy moving, big-ticket items include an extension of the low and middle-income tax offset, $15.1 billion in infrastructure projects nationally, and an extra $3 billion for the struggling vaccine rollout.
$7.8 billion in tax relief will go to some 10 million Australians on low and medium-incomes, with those earning between $48,000 and $90,000 benefiting the most. The maximum offset is $1080 for singles or $2160 for couples.
Women and Aged Care were a token item in the budget, with $1.1 billion allocated to women’s safety and $17.7 billion in additional Aged Care funding over the next five years.
An election year, these big-ticket items are no surprise given the government’s ongoing “women problems” and shocking findings of the Aged Care Royal Commission. So far, 85 per cent of recommendations made by the royal commission have been implemented, with six rejected and others subject to consideration.
We won’t bore you with too many details. You can get those in budget in our summary here. But what are the key elements affecting young people?
At the start of the COVID-19 pandemic last year, some economists were predicting a fall of up to 30% in house prices.
But a year later, with the introduction of $25,000 HomeBuilder Grants (and thousands of Australians accessing their super early), the property market is soaring.
The budget aims to deliver some relief, with Treasurer Josh Frydenberg promising, “under the coalition, homeownership will always be supported”.
Measures include adding 10,000 places to the first home buyer’s scheme, allowing buyers to put down a 5 per cent house deposit with the government guaranteeing the other fifteen.
Single parents can also access homes with a deposit of just 2 per cent and the First Home Super Saver Scheme (FHSS) limit will be increased to $50,000, up from $30,000.
Introduced in Turnbull’s 2017-18 Budget, the FHSS allows Australians to draw voluntary superannuation contributions toward a house deposit. Voluntary super contributions are taxed at just 15 per cent, resulting in more savings compared to normal bank accounts.
Despite calls from advocates and the community, there were no significant increases to social housing from the Commonwealth. $1.6 billion for the National Housing and Homelessness Agreement will remain.
Some have criticised the budget’s housing measures, though. As little as 8 per cent of first home buyers could benefit from government incentives, while accessing superannuation will help drive up prices.
National home values rose 2.8 per cent in March alone, the fastest rate since October 1988. The national median house value reached $643,000, with prices in Adelaide up 5.6 per cent this year so far.
Housing affordability is an ongoing concern for young Australians, especially those trying to enter the market. Homeownership for Aussies aged 25-29 dropped from 50% in 1971 to 37% in 2016.
Government ministers have previously recommended young Australians rely on the “bank of Mum and Dad”, but that is not an option for some and does nothing to address intergenerational inequality.
Many people, especially young Australians, felt the brunt of the COVID-19 pandemic mentally.
The budget acknowledges this, funding $2.3 billion for mental health and suicide prevention. An extra $278 million was announced for Headspace, and $13 million will help establish the National Suicide Prevention Office.
1 in 4 Australians will experience mental health problems. Suicide is a leading cause of death in young Australians, who are least likely to seek help.
Last year’s budget didn’t include much for women. But the tone has shifted this year, following revelations of a culture of sexism within parliament and the Coalition.
A $3.4 billion package focuses on jobs, and domestic violence will be delivered for women. It includes $1.1 billion to help tackle violence and harassment and $332 million for health and wellbeing.
$1.7 billion will also be spent over the next five years, increasing the childcare subsidy for families with more than one child.
$10.7 million will be dedicated to sexual awareness programs in schools, though it is worth noting the infamous Milkshake ad cost $3.8 million and aged like … milk.
Some say these measures are not enough and have called for a budget that considers women more broadly.
Employment and university funding
The government hopes to get the national unemployment rate down to a comfortable 4.5 per cent.
The unemployment rate in South Australia currently sits at 6.3 per cent, with Australians aged 25 to 34 being the most impacted by unemployment after people aged over 65.
The government’s JobTrainer program will be extended at the cost of $506 million, delivering 163,000 affordable courses in areas where there is a skill shortage. Bosses who hire apprentices will get wage subsidies.
Universities, who face significant revenue drops as the money from international students dries up, received no additional relief in this year’s budget. Treasury estimates international borders will open in 2022.
The only notable mention is $1.1 million in scholarships to support industry relevant PhDs. Some have criticised the lack of funding given the pandemic recession’s impact on universities.
Last but certainly not least is one issue impacting all young Australians: climate change. There is still no significant funding for renewables.
$30 million will build a battery and microgrid in outback Northern Territory, but renewable funding stops there.
Instead, the government focuses on ‘low emissions’ technologies designating $539 million for “clean” projects like hydrogen production and carbon capture projects.
These projects will deliver regional jobs, but many have slammed them, saying hydrogen production doesn’t deliver zero emissions.
In a press release, the Climate Council said the failure to fund clean energy properly is a national shame and a lost opportunity to create jobs.
“The Federal Government continues to throw taxpayers’ money at polluting industries of the past like gas which provides very few jobs. It should be focused on creating good, clean jobs in renewables,” said Climate Council spokesperson and economist, Nicki Hutley.
“Among major economies and our strategic allies, Australia is right at the bottom of the pack when it comes to spending on solutions that reduce emissions,” she said.