- Queensland State Budget 2018-19
Treasurer Hon Jackie Trad MP handed down the Queensland State Budget on 12 June 2018. This Budget has a focus on economic growth for a growing population.
The theme of creating jobs in Queensland which we have seen throughout the current Government’s tenure has been maintained, along with significant investment in infrastructure and education. There is a trade-off though with a significant increase in debt to fund these initiatives and a massive interest bill for future Queenslanders.
The headline takeaways from the Budget are:
- A net operating surplus of $1.512 billion expected for 2017-18, which is $1.027 billion higher than estimated at the 2017-18 Mid-Year Fiscal and Economic Review and $1.366 billion higher than the surplus forecast at the time of the 2017-18 Budget.
- Forecasted operating surpluses over forward estimates, starting with $148 million in 2018-19.
- Employment growth is forecasted to strengthen to 2.75% over the year to June 2018 quarter, which would reflect the strongest growth in more than a decade.
- Economic growth is expected to strengthen to 2.75% in 2017-18 and 3% in 2018-19.
- $45.8 billion capital works expenditure over four years, an increase of $3 billion on last year’s Budget. This is the biggest capital works programme since the 2011 flood recovery effort.
- Investment of $21.7 billion over the next four years in the Queensland Transport and Roads Investment Program (QTRIP) included much-needed upgrades to critical road congestion issues.
- A $17.3 billion health budget and a record $14.1 billion investment in education and training for 2017-18.
- An increased debt of $13.6 billion to increase the State’s total debt to a record $83.1 billion, with interest payments increasing to $3.7 billion a year by 2021-22.
This Budget seeks to facilitate growth in Queensland by increasing the economic opportunities available to Queenslanders through investment in capital works. This is supplemented through the investment in education and training to enhance the capacity of Queenslanders to access these opportunities. Despite a significant increase to debt, the Government considers these investments necessary to support a growing population.
This Budget also introduces five new taxes, including four that were previously announced in the November election, which impact luxury car buyers, betting, foreign property investors and landholders, alongside the reintroduced waste levy, which will combine to raise $1.8 billion over the next four years.
Specifically, the Budget delivers the following:
- $570.8 million over six years from 2017-18 as part of the $679 million Building Better Hospitals package to enhance public hospital capacity and services in South East Queensland.
- $84.8 million as part of the Enhancing Regional Hospitals Program, for upgrades of the Hervey Bay and Gladstone emergency departments, redevelopment of Roma Hospital and repurposing of the Caloundra Health Service.
- Increased funding of $154.7 million over two years for the continued delivery of the Specialist Outpatient Strategy.
- Increased funding of $109.6 million over two years to increase the number of nurse navigators in Queensland public hospitals to 400.
- $4.9 billion investment in roads and transport infrastructure, including:
- $733 million for the Cross River Rail Delivery Authority in 2018-19 to continue to progress the planning, procurement and development associated with the $5.4 billion Cross River Rail project.
- $200 million to widen the Bruce Highway from four to six lanes between Caloundra Road and the Sunshine Motorway.
- $22 million in 2018-19 on two new jointly-funded M1 Pacific Motorway projects.
- Significant capital investment in the energy and water portfolios in 2018-19, of $2.2 billion and $277 million respectively.
- $534.3 million to continue the Toowoomba Second Range Crossing project.
- $339.1 million towards the construction and upgrade of the social housing stock.
- $200 million over three years to extend the Works for Queensland program to support job-creating maintenance and minor infrastructure works across regional Queensland, bringing the total funding of this program to $600 million over five years.
- The Government has committed to employing an additional 3,700 teachers over the next four years at an estimated cost of $1 billion.
- $308 million over six years for the Building Future Schools to deliver world-class learning environments for students, and to address enrolment growth pressures in state schools.
- $235 million over four years to substantially refurbish and upgrade 17 State schools across Queensland.
- $135 million over three years to the non-State schooling sector to support infrastructure.
$1.543 billion for the third year of the transition into the National Disability Insurance Scheme.
- $1.3 billion for child safety and family services delivery and frontline staff.
- $1.1 billion for a range of energy rebates and concessions, including a $100 million Electricity Asset Ownership Dividend which will be provided to Queensland households and $212 million for a range of energy rebates and concessions dedicated to supporting eligible seniors, pensioners, veterans and low-income families.
- $500 million for redress payments to survivors of institutional child sexual abuse and counselling / psychological support.
- $371 million for a new public transport ticketing system across the state over the next four years. The system will add new customer facing functionality including payment by contactless debit and credit cards, mobile phones and wearable technology in addition to go card and paper tickets.
- A $369 million Back to Work initiative to give Queensland employers the incentive to hire eligible jobseekers. Support payments of up to $20,000 are available for eligible employers, with funding committed across regional Queensland and targeted areas of South East Queensland.
- $330 million investment over five years to protect the Great Barrier Reef.
- $100 million will be allocated over three years to support Queensland’s resource recovery and recycling industry through the Resource Recovery Industry Development Program.
- The introduction of a waste disposal levy to discourage the interstate transport of waste and encouraging alternatives to disposal of waste to landfill, thus providing certainty for investment in job-creating reuse, recycling, bioproducts and waste to energy industries.
- The banning of single use plastic bags from 1 July 2018 and the introduction of the container refund scheme from 1 November 2018.
- $171.9 million over four years for 400 police officers in high priority areas and $55.1 million over four years for 85 counter-terrorism officers and operational specialists and to establish a Security and Counter-Terrorism Command.
- $29.5 million over four years for an additional 100 firefighters and 12 fire communication officers.
- $55 million to replace, upgrade or refurbish police facilities as well as $30 million for new and replacement police service vehicles.
- $40.7 million over four years for youth justice support measures.
State taxes changes
The budget delivers the following State taxes changes:
- The continuation of the payroll tax rebate on the wages of apprentices and trainees at the increased rate of 50% (up from the previous 25%) until 30 June 2019. This means that employers who hire apprentices and trainees will receive a payroll tax rebate of 50% on the apprentice and trainee wages in addition to their wages being exempt from payroll tax until 30 June 2019.
- The Additional Foreign Acquirer Duty on purchases of Queensland residential land by foreigners will increase from 3% to 7% with effect from 1 July 2018.
- There will be an increase of 2.25% on the rate of Land Tax on aggregated landholdings above $10 million owned by resident individuals, as well as a 2.5% increase for landholdings owned by companies, trustees and absentee owners. The change will apply to the portion of the owner’s taxable landholdings that exceeds $10 million from 1 July 2018.
- An increase of the rate of Motor Vehicle Duty by 2% (being a $2 increase per $100) for vehicles with a dutiable value over $100,000 from 1 July 2018. This change will not apply to heavy vehicles.
- A new Point of Consumption Betting Tax equal to 15% of net wagering revenue will be applied to online betting services from 1 October 2018 to combat the increase of online gambling and gambling with interstate companies.