Business Hunter has labelled the Federal Budget as “lukewarm”, stating it contained little in the way of regionally-specific project funding.
Treasurer Jim Chalmers handed down his fifth financial blueprint on Tuesday 12 May, but not everyone was thrilled with the outcome.
In fact, it divided the pundits.
As for the CEO of the region’s business voice, Bob Hawes admitted there were few surprises.
“While it contained a few groundbreaking measures on tax reform, productivity and addressing generational housing inequity, expectations of regional spending were justifiably low in the lead-up, given the absence of local announcements and frontbench visitors to the Hunter,” he said.
“There are some benefits for the region, which will come from broad measures such as the $53 billion increase in defence spending over the next 10 years.
“That provides opportunities for supply chain businesses in the Hunter by lifting spending on unmanned systems, sustainment and missile production.
“There is great potential for SMEs to contribute to the development and production of unmanned systems due to their scale and need for innovative approaches and niche expertise.
“The increase in sustainment funding is good news for primes and supplier businesses connected to the Williamtown RAAF base, which is the premier base for Australia’s F35 fleet and a regional hub for repair and maintenance, as well as the establishment of the Kongsberg facility.
“It’ll position the Hunter to benefit from a greater emphasis on missile production.
“The $2 billion fund for enabling infrastructure for housing will support the construction sector and boost housing supply, but with only $500 million to go to the regions, it’ll be spread thinly and is not the panacea for accelerating housing delivery.”
Mr Hawes said the budget reprioritised and redirected funding away from some old initiatives towards the new Boosting Productivity reforms, among them measures to streamline and accelerate renewable energy projects, which will improve certainty and encourage investment.
“There was also a reprioritisation of funding in the skills workforce portfolios to underwrite previously announced programs targeting key apprenticeship and training disciplines,” he added.
“But, no funding to entice small- and medium-sized businesses to increase the uptake of apprentices and trainees, which has sagged since subsidies were cut at the start of this year.”
Among Hunter-specific commitments were $25.3 million to establish new Medicare Urgent Care Clinics across the region, including the Central Coast, and a $1 million top-up to the $5 million package announced last year for master-planning to support the reuse of mining lands in Lake Macquarie and Muswellbrook.
The Lake Macquarie Mines Grouting Fund and Port of Newcastle’s hydrogen-ready project received allocations of $10 million and $8 million respectively.
The $230 million for the development phase for the Newcastle-to-Sydney High-Speed Rail link, unveiled in February, was confirmed, too.
The budget also contains measures that will assist regional businesses, including confirmation that the instant asset write-off for SMEs on assets up to $20,000 will be made permanent.
Moves to increase and stabilise fuel supply should have a positive impact on price fluctuations and consumer confidence, helping to relieve some of the recent cost pressures on business.
Mr Hawes admitted it was disappointing, but not unexpected, that the budget contained no mention of a support package for Tomago Aluminium.
“It did reinforce financial assistance for the Boyne aluminium smelter in Queensland and the Whyalla Steelworks in South Australia, both the subject of joint state-federal funding agreements reached earlier this year,” he said.
“So, we can only assume the Tomago package will be finalised outside of the budget process and urge the NSW and federal governments to get the deal done.”
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