Budget Breakdown | Federal Budget 2024
This year’s Budget squarely focused on balancing cost-of-living relief and maintaining the view of curbing inflation. More than likely, this will be the final budget before the election, and a clear priority has been placed on supporting low-income earners and incentivising investment in the key areas of housing and renewable energy creation and transmission (largely through the Future Made in Australia Act).
A second consecutive Budget surplus of $9.3 billion has been delivered, a result significantly different to the one initially forecast in the Mid-Year Economic and Fiscal Outlook (MYEFO), where a $1.1 billion deficit for 2024-25 was predicted.
Treasury Department modelling for the budget shows inflation falling back to within the Reserve Bank of Australia’s (RBA) target range of 2-3 per cent by December, almost one year earlier than the Reserve had forecast at its May meeting.
With a targeted and tightening Budget, tourism and regional development have received limited support. Caravan Industry Association of Australia continues to work with the Government on ensuring support for Australia’s largest domestic tourism provider and its last sovereign vehicle manufacturing sector.
We are pleased to provide the following budget overview on matters that we anticipate affecting industry.
The Government is providing $290 million to extend the $20,000 instant asset write‑off for 12 months. This will allow businesses with a turnover of less than $10 million to claim up to $20,000 from eligible assets. For the current financial year, it applies to assets that are either first used or installed ready for use between July 1, 2023 and June 30, 2024 and under the extension, the scheme will now run to June 30, 2025. Assets valued at $20,000 or more can continue to be put into the small business simplified depreciation pool and be depreciated at 15 per cent in the first income year and 30 per cent each income year after that. It should be noted that at time of writing, the original announcement made as a part of the 2023 Budget by the Treasurer is still under debate, with the deadline for government to ensure its availability being June 30.
The Budget has provided $3.5 billion in energy bill relief for all Australian households and around one million small businesses
For businesses, this will mean that eligible small businesses will receive $325 on their electricity bills throughout the year. This is estimated to directly reduce headline inflation by around 1/2 of a percentage point in 2024–25 and is not expected to add to broader inflationary pressures.
A Small Business fact sheet can be found at: https://budget.gov.au/content/factsheets/download/factsheet-sml-bus.pdf
The government has allocated an additional $6.2 billion towards housing, as the Government works to deliver its promised 1.2 million new homes by 2030.
It is important to note, under the Housing Australia Future Fund and National Housing Accord, the focus on an increase in affordable housing supply remains the key focus. The budget funding is again focussed on supporting those at risk as well as supply-side challenges through State Government incentivised funding and planning incentive funding. Budget Housing funding include:
Commonwealth Rent Assistance saw an additional 10% with a $1.9 billion investment, benefiting nearly 1 million households. This brings up a 40 percent increase including indexation since May 2022. This will see a further boost to our MHE and Land Lease Community residents receiving a further boost.
The Budget invests a further $6.2 billion in specific social and affordable housing initiatives, taking total new investment to $32 billion. The majority of the effort being put towards directly increasing the supply of social and affordable housing, delivering 40,000 social and affordable homes through the National Housing Accord and the Housing Australia Future Fund. An additional $1 billion to the states and territories to deliver new housing – including for connecting essential services such as water, power, sewerage and roads. This is in addition to providing $2 billion to the states and territories to deliver around 4,000 new and refurbished social homes through the Social Housing Accelerator.
With Housing taking centre stage of the Budget, it remains unclear on the extent to which the spending will deliver practical and pragmatic outcomes for MHE/LLC communities.
Ultimately, the funding announcements for housing continue to build on top of the $25 billion already committed to new housing investments, with $10 billion of that within the Housing Australia Future Fund, which is designed to help build 30,000 social and affordable rental homes.
Sharing the stage with Housing in this year’s Budget is that of Renewable Energy Manufacturing through the Future Made in Australia Act.
The Future Made in Australia Act will consolidate a range of new and existing manufacturing and renewable energy programs that have previously been scattered under different titles and entities under a $22.7 billion package.
Walking the tightrope of contracting economic productivity and inflationary pressures, Treasurer Chalmers warned the public not to expect any big ‘cash splashes’, stating that the Budget will be neither ‘scorched-earth austerity’ nor ‘free-for-all spending’. The focus of the fund remains manufacturing capabilities in the national interest such as defence, tech, medical equipment and renewable energy, little focus has been shown for core manufacturing capabilities.
Previous announcements under the Future Made in Australia Act include:
Road Safety has again focussed in this year’s Budget with a $21 million commitment towards the creation of a national road safety data hub. Caravan Industry Association of Australia has been a proud partner of the Australian Automobile Association (AAA) and other key industry bodies in calls for an increased data driven approach to road safety through the Data Saves Lives campaign. We look forward to ongoing consultation with government as to how our industry can assist with keeping motorists safe.
Further information regarding the Data Saves Lives campaign can be found at https://datasaveslives.org.au/
The Government has placed heavy priority on urban and peri-urban roads projects, this is in contrast to the minimal funding directed towards regional and rural roads.
A range of road funding commitments have been made around the country, including:
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