Australia markets close in 4 hours 55 minutes
  • ALL ORDS

    7,298.80
    +43.00 (+0.59%)
     
  • ASX 200

    7,067.90
    +44.30 (+0.63%)
     
  • AUD/USD

    0.7787
    +0.0015 (+0.20%)
     
  • OIL

    66.43
    +0.16 (+0.24%)
     
  • GOLD

    1,868.90
    +1.30 (+0.07%)
     
  • BTC-AUD

    57,753.39
    -686.95 (-1.18%)
     
  • CMC Crypto 200

    1,239.89
    +41.97 (+3.50%)
     
  • AUD/EUR

    0.6400
    +0.0008 (+0.13%)
     
  • AUD/NZD

    1.0774
    +0.0004 (+0.04%)
     
  • NZX 50

    12,398.57
    -11.90 (-0.10%)
     
  • NASDAQ

    13,312.91
    -80.21 (-0.60%)
     
  • FTSE

    7,032.85
    -10.76 (-0.15%)
     
  • Dow Jones

    34,327.79
    -54.34 (-0.16%)
     
  • DAX

    15,396.62
    -20.02 (-0.13%)
     
  • Hang Seng

    28,194.09
    0.00 (0.00%)
     
  • NIKKEI 225

    28,223.42
    +398.59 (+1.43%)
     

UPDATED: Everything we know so far in the Federal Budget 2021

Jessica Yun
·9-min read
Josh Frydenberg delivers budget speech.
Treasurer Josh Frydenberg is about to deliver his second 'pandemic budget'. (Photo by Sam Mooy/Getty Images)

This story is being regularly updated following new announcements.

Growing the economy, getting Aussies back in jobs, and lowering the unemployment rate.

These priorities are at the top of Treasurer Josh Frydenberg’s agenda as he puts final touches to the 2021-22 Federal Budget to be delivered on 11 May.

The “pandemic budget” will contain measures to boost job skills, infrastructure, tax, energy, digital technology and deregulation, he said in a speech last week.

“The Budget will lay out the next phase of Australia’s economic recovery plan, to grow our economy so we can deliver the jobs and guarantee the essential services Australians rely on, and keep Australians safe.”

The new goal is to get unemployment to below pre-COVID levels.

“Both the RBA and Treasury’s best estimate is that the unemployment rate will now need to have a four in front of it to deliver this outcome,” Frydenberg said. “We want more people in jobs and in better paying jobs.”

While the plan will be laid out in full at 7:30pm AEST Tuesday, the Government has already outlined some areas that will get funding. Here’s everything we know so far.

$10 billion to bolster infrastructure

The Budget will include an extra $10 billion towards infrastructure projects to make roads safer and reduce travel time. The extra funding is expected to support nearly 20,000 jobs.

Most state and territories in Australia will benefit from the extra funding. Here's Yahoo Finance's state-by-state breakdown.

JobTrainer to be extended

The Government's JobTrainer program will be extended for another 12 months at the cost of $1 billion, meaning tens of thousands of people will be offered free or low-fee courses to help patch up skills shortages.

The JobTrainer program is designed for 17-24 year olds and was set to expire in September, but will be extended for another year.

"JobTrainer has been a very successful program — more than 100,000 places already and that is helping equip people with the skills they need to find the work that they need," Frydenberg told ABC.

2% deposit for single parents

The Federal Government is encouraging single parents to buy their own house by making a 2 per cent deposit available to them under a new 'Family Home Guarantee' scheme available to single parents.

From July, single parents with dependent children will be able to buy a home with a deposit of just 2 per cent with the government guaranteeing the remaining 18 per cent.

“This is giving an opportunity to single parents with dependents with a household income under $125,000 to get into home ownership,” Frydenberg said over the weekend. More here.

$350 million for women's health

Women will be a major focus in this Federal Budget, particularly in light of the spotlight shone on women's treatment in the workplace sparked by Brittany Higgins' Parliament House rape allegations.

Health Minister Greg Hunt on Sunday announced that $353.9 million would go towards women's health services, particularly towards cervical and breast cancer, endometriosis and reproductive health with the aim of improving "long-term health outcomes for women and girls" across the nation.

More than $100 million will go to improving cervical and breast cancer screening programs, while $96 million will go towards new tests on the MBS for pre-implantation genetic testing of embryos. A further $47.4 million will support the mental health and wellbeing of new parents.

More on his announcement here.

More pensioners to gain extra powers to top up super

Pensioners aged 60 and above selling their home will be allowed to make a one-off contribution to their superannuation, the AFR reported.

At the moment, only pensioners aged 65 and above are allowed to make a top-up of $30,000.

Yahoo Finance has contacted Treasury and the Treasurer's Office for more comment.

$1.2 billion to boost the digital economy

The Government will invest nearly $1.2 billion into the Digital Economy Strategy to help businesses pivot online.

“We must keep our foot on the digital accelerator to secure our economic recovery from COVID-19," said Morrison.

Frydenberg added: “Our Digital Economy Strategy will allow Australian businesses to capitalise on the opportunities that digital technologies are creating."

$1.7 billion to boost childcare services

The Federal Government will dedicate $1.7 billion to childcare services aimed at helping 400,000 families – particularly low- and middle-income families – save on childcare costs and work an extra day or two.

Beginning on 1 July 2022, the Government will:

  • Increase the child care subsidies available to families with more than one child under five years old and in child care, benefitting around 250,000 families

  • Remove the $10,560 cap on the Child Care Subsidy, benefitting around 18,000 families

This means single parents on $65,500 with two children in four days of long day care can work a fifth day, and be $71 a week better off.

Here’s more on what this boost means for families.

Superannuation will go up as planned

The Government has set a timeline for the superannuation guarantee rate (the percentage of your pay that goes to your super fund) to go ahead. A rise of 0.5 per cent is scheduled every 1 July until 2026, at which it will hit 12 per cent.

The Government was reportedly considering hitting pause on these plans, but it is expected to allow the scheduled increase to go ahead.

This will mean the current SG rate of 9.5 per cent will rise to 10 per cent after 1 July.

$250,000 tax breaks for breweries and distilleries

Over the weekend, Frydenberg announced tax breaks for breweries and distilleries that would mean up to $250,000 in savings every year.

At the moment, brewers and distillers are able to claim 60 per cent of paid excise up to $100,000 a year, but this limit will be lifted to $350,000.

$120 million deregulation package

To help clear the way for businesses to invest and hire new workers, the Government is committing $120 million to reduce compliance costs and streamline the regulatory burden.

“The private sector should remain the primary engine of growth in our economy," Morrison said last Monday.

This has also been described as “stage two” of the national economic recovery plan.

At least $10 billion for aged care funding

The Morrison Government is expected to pledge at least $10 billion across four years to aged care – but the industry has argued that this sum won't be enough.

A source told Fairfax that the Government is planning to spend in excess of $10 billion on home care packages, which allows people to stay in and receive care from their homes for longer.

The final figure has yet to be finalised, the source said, but it’s expected to be a “very big package”.

But Grattan Institute health program director said the Government’s response to the Aged Care Royal Commission to date has been “superficial”.

“The Government must lift its ambition, and seize this opportunity to introduce landmark social policy reform fit to stand next to Medicare and the National Disability Insurance Scheme,” Duckett said.

In fact, we’ll need about $10 billion every year to implement serious reform in the aged care system, according to a Grattan Institute report on this topic.

$747 million upgrade to Northern Territory military bases

Just shy of $750 million will go to upgrading four key training areas and ranges in the Northern Territory to help the Australian Defence Force be “battle ready”, Morrison announced last week.

“This investment will deliver a jobs boom for the Northern Territory,” the Prime Minister said.

“We continue to invest more than $270 billion in defence capability across Australia over the next decade, ensuring we have a capable defence force to meet a changing global environment, while backing thousands of ADF men and women with the newest technology and training.”

In a subtle reference to China’s aggressive moves in the South China Sea, Morrison said his focus was to “pursue peace, stability and a free and open Indo-Pacific”.

$371 million biosecurity package to keep out pests

Morrison and Minister for Agriculture David Littleproud on Tuesday announced a $371 million package for biosecurity measures to keep out exotic pests and diseases, such as African swine fever, the khapra beetle and foot and mouth disease.

"This investment is about building a protective ring around Australia to safeguard our industry as well as the rural and regional communities that depend on it,” Morrison said.

"We need to make sure agriculture continues to play a leading role in our national economic recovery."

WA gets $1.3 billion infrastructure boost

The Federal Budget sets aside more than $1 billion to fund infrastructure projects in Western Australia specifically.

The package includes nearly $350 million to Metronet, $200 million to upgrade the Great Eastern Highway, and more.

The funding is aimed at helping producers based in Western Australia, Morrison said.

“From upgrading the Great Eastern Highway and building METRONET, to improving roads and rail lines that are crucial to our grain growers and farmers in the Great Southern and Wheatbelt – these projects will support more than 4,000 direct and indirect jobs across WA.”

A new disaster recovery agency

The Morrison Government today announced it will set up the National Recovery and Resilience Agency, a new national agency to help local communities in the relief and recovery phase after a major disaster.

The new agency will also give advice to the Government on policies and programs to minimise the impact of future events. The agency will get $600 million to create and manage a new disaster preparation and mitigation program.

“Immediate funding will support resilience projects across the community and for individuals’ homes, such as bushfire and cyclone proofing houses, building levees and improving the resilience of telecommunications and essential supplies,” Morrison said.

Further tax cuts expected

Though nothing has been announced or confirmed yet, Frydenberg is reportedly mulling an extension to the low and middle-income tax offset (LMITO), which is scheduled to wind back in the coming financial year.

But once the offset comes to an end, analysis shows that Aussies would see an increase in the tax they pay.

If the Government extends the tax offset, it’s expected to cost the Government $7 billion.

“The Coalition is always the party of lower taxes,” Frydenberg said. “That's our record and that will continue to be the message and the policies we deliver going forward.”

More to come.

Did we miss anything? Let us know at jessica.yun@yahoofinance.com.

Don’t miss our Federal Budget coverage: Sign up to the newsletter here.

Follow Yahoo Finance on Facebook, LinkedIn, Instagram and Twitter, and subscribe to the free Fully Briefed daily newsletter.