Dave Sharma (Wentworth, Liberal Party) Share this | Hansard source

The federal budget delivered at the start of this month lays out a comprehensive economic recovery plan for this nation. The COVID-19 pandemic, on top of the tragic loss of life that it's caused, is the biggest shock to hit the global economy since the Great Depression. The global economy is forecast to contract by 4.5 per cent through 2020, and in the last major economic shock, the global financial crisis, the world economy contracted by 0.1 per cent. So we're talking about a shock in orders of magnitude bigger than we experienced in the global financial crisis. There have been over 32 million cases of COVID-19 around the world and no-one has proven immune. We've seen world leaders, from the UK Prime Minister to the President of Brazil, and indeed the President of the United States, struck low with COVID-19. In a normal year around the world, malaria kills 600,000 people, HIV/AIDS kills 950,000 people, and over 800,000 people take their lives through suicide. So far this year, COVID-19 has killed over one million people, and there are still several months to go. So anyone who plays down the lethality and seriousness of this disease is not only wrong; they are dangerous. They are encouraging complacency where none is warranted.

The economic shock of COVID-19 has been equally profound. It's undoubtedly the biggest economic shock to the globe since the Second World War. As I mentioned, the predicted global economic contraction is about 4.5 per cent, and that's across all major economies. The IMF expects the United States economy to contract between four and five per cent over 2020; Japan by five per cent; the Euro area by eight per cent; the UK by around 10 per cent; and New Zealand has contracted by around 13 per cent. In fact, the only major economy that's forecast to grow in 2020 is China's.

The 2020-21 budget outlines further measures to help cushion the blow of the pandemic, accelerate the recovery and help rebuild the economy for the future. It builds on previous support measures, including JobKeeper, JobSeeker, cashflow relief for small businesses and early access to super. All up, these measures will amount to some $507 billion in government fiscal support since the onset of the pandemic. This is one of the biggest fiscal stimuluses ever delivered by a government.

This year has been hard for many Australians, but we are emerging from this crisis intact and together. Of the 1.3 million Australians who either lost their jobs or had their hours reduced to zero in April, over half are now back at work. Four hundred and forty-six thousand jobs have been created in the past four months. Consumer confidence has been up for seven months straight. In just this month, consumer sentiment jumped 11.9 per cent on a month-on-month basis, following an 18 per cent jump the previous month, to what is 105 points on the Melbourne Institute and Westpac Bank Consumer Sentiment Index. Quoting from Westpac-consumer sentiment October, it was 'the highest level since July 2018' in the 'ongoing success across the nation in containing the COVID-19 outbreak' and the response to the October federal budget. Whilst the Australian economy is expected to contract by 3.75 per cent in calendar year 2020, it's forecast to recover in 2021 and grow by 4.25 per cent. Unemployment is expected to peak at around eight per cent in December and decline after that. These are sobering figures, but, without direct government support, it's estimated by Treasury and the budget papers that unemployment would have peaked at 12 per cent and stayed there for considerably longer.

Although I know it's perhaps of little comfort to Australians doing it tough right now, Australia has fared well in terms of managing the health and economic impacts of this crisis. Our deaths from COVID-19 are significantly fewer than in other developed countries and our economy has weathered the storm better. We entered this in a strong fiscal position, having restored the budget to balance, and, even with the additional spending of over $500 billion, our net debt to GDP ratio will peak at around 44 per cent and remain low by world standards. Just yesterday, Australia had its AAA credit rating reaffirmed. We will manage this debt burden by restoring jobs, growing the economy, positioning Australia's future industries and shrinking the debt as a proportion of the economy.

The budget lays out our strategies to rebuild the economy and secure Australia's future. First of all, the budget is supporting households. The budget will bring forward stage 2 of our income tax relief, increasing the low-income tax offset and lifting the tax thresholds. As a result, more than 11 million Australians will get a tax cut backdated to 1 July. Lower and middle income earners will receive up to $2,745 in tax relief for singles and up to $5,490 for dual-income families compared with 2017-18. This will support consumption and small business.

The budget is also helping job creation. There will be a new JobMaker hiring credit to encourage businesses to hire younger Australians, payable for up to 12 months and available to those employers who hire Australians aged 16 to 35 who have been on JobSeeker in one of the past three months. Treasury estimates that this will support around 450,000 new jobs for young people. The budget also commits an additional $1.2 billion to create 100,000 new apprenticeships and traineeships, with a 50 per cent wage subsidy for businesses who employ them. This is in addition to the earlier $2.8 billion commitment to protect 180,000 apprenticeships and trainees.

The budget will also help Australians looking to retrain and to upskill, providing funding for 50,000 new higher education short courses in areas such as information technology, health, science and teaching. The budget is also providing investment incentives. Business investment will be the key to economic recovery, and the budget provides support for new investment. Four out of five jobs in Australia are in the private sector, so this is the obvious focus of our efforts. This will be the engine room of our economic recovery.

In measures announced in the budget, businesses with a turnover of up to $5 billion, which is nearly every Australian business, will be able to write off the full value of any eligible asset they purchase for their business, with no limit on the value of assets eligible for full expediency. Businesses will also be able to offset losses from this financial year against profits made in prior financial years, back to 2018-19. These loss carry-back measures will provide instant relief for viable businesses that have found themselves in tough times this year.

The budget is also caring for the vulnerable. The budget will provide record funding for hospitals, for schools, for child care, for aged care, for mental health and for disability services. An additional $3.9 billion will be provided to the National Disability Insurance Scheme to further its life-changing support for the 400,000 Australians who have a disability. As we all know, the mental health impacts of this crisis have been significant, with around seven million Medicare subsidised mental health services delivered since March and some very troubling reports about increases in mental health episodes across the nation.

In this budget, the number of Medicare funded psychological services available will be doubled from 10 to 20 per year, and there will be more funding provided for headspace, Lifeline, Beyond Blue and Kids Helpline. I would like to give a special shout-out to headspace in here today, given it is headspace Day and given the work that headspace in my own electorate in Bondi Junction does. The budget also makes provision for 23,000 additional home care packages that will be provided to the elderly, increasing the total to more than 180,000—a tripling since 2013. Age pensioners will receive two supplementary payments of $250 in each of the next two quarters.

The budget will also provide help with affordable housing also. Under an expansion of the First Home Loan Deposit Scheme, an additional 10,000 first home buyers will be eligible to purchase a home with a deposit of as little as five per cent. The budget also provides an additional $1 billion in low-cost finance to support the construction of affordable housing, taking the total concessional finance that has been provided to community housing providers to $3 billion. That is on top of the $4.6 billion that is provided annually by the federal government in rent assistance.

Importantly, the budget is supporting clean energy and supporting the environment. Australia has a promising future in a low-emissions world, and this budget helps accelerate and support this transition. A $1.9 billion package of assistance will be used to fund research and development and help commercialise promising new technologies in areas such as clean energy, clean hydrogen, battery storage, low-emission steel, low-emissions aluminium and soil carbon. Of this, $1.6 billion will be provided to the Australian Renewable Energy Agency, or ARENA—a renewal of funding that I campaigned hard for.

The budget also contains almost $250 million to modernise recycling infrastructure and help build a recycling industry here in Australia, so we reduce our waste process more of it here. This will help implement the 2020 decision of COAG, the Council of Australian Governments, to ban the export of waste glass, waste plastics, waste tyres and waste paper. Once the relevant legislation is enacted, the export of waste material from Australia of glass, plastics, tyre and paper will be prohibited unless it is processed first into a value-added material or it will be reused as a manufacturing input overseas.

This will help phase-in the end of the almost $645,000 tonnes of unprocessed plastic, paper, glass and tyres that Australia ships overseas each year. It will fund and encourage the development of a circular economy in Australia, by enhancing voluntary product stewardship and supporting businesses to consider the full life cycle of products before they're manufactured and before they sell. It will impose obligations for manufacturers, distributors and importers of certain products to manage the full life cycle of these products, and to take greater responsibility for their impact on the environment. And it will help realise the economic and community benefits of processing Australian waste here in Australia. In doing so, it will create new industries, create new products and create new jobs.

In the budget, there is also a significant sum to protect the health of our oceans and waterways and marine ecosystems, including sea grasses, coral reefs and, of course, the Great Barrier Reef.

The budget is also investing in the future, in high-technology, knowledge-rich, innovative industries that will be the key to Australia's future economic success and prosperity, and I'm pleased the budget is helping to nurture these. There is $1 billion in research funding for the university sector. The Universities Australia chair, Professor Deborah Terry, said:

The Government clearly understands you can't have an economic recovery without investing in research and development.

This will ensure world-class research and discovery can continue on Australia's university campuses. That means universities can play their part in the national effort to rebuild the economy.

I agree with that sentiment. We can't have an economic recovery without investing in research and development, and universities will play a part in the national effort to rebuild the economy. An additional $459 million will go to CSIRO, to fund essential scientific research, and there's our Modern Manufacturing Initiative of almost $1.3 billion that will help improve collaboration, support commercialisation and build new, promising industries in areas such as space, recycling, clean energy, medical products and food manufacturing.

A few weeks back I was at a blood plasma fractionation facility that has just opened up at Macquarie Park in North Ryde. It's in the electorate of the member for Bennelong, Mr Alexander. We were there to open a new blood plasma fractionation facility being started by two Australian founders—Aegros is the name of the company—and they're doing research into a promising hyperimmune to treat COVID-19. When I spoke to the founders, John Manusu and Hari Nair, they told me how important the investment incentives in the budget were. They have spent a lot of money acquiring new plant and equipment to run this blood plasma fractionation facility, and they were encouraged about the future with the measures announced in this budget.

In the week after the budget, I took the Treasurer, Josh Frydenberg, to a local Bondi cafe in my electorate of Wentworth, Bennett Street Dairy. There he met the owners, who told him how they'd used JobKeeper and the cashflow relief to small businesses to pivot their business and to invest in new technology. What had been a sideline they were doing in cookie dough had turned into a mainstay of their business, because of the measures we provided in response to COVID-19.

I'm pleased to announce that there is also significant money available locally in my own electorate of Wentworth. Many of my electors will benefit directly from the measures in the budget. There are over 85,000 people in Wentworth who will get tax relief through the tax cuts. There are over 33,000 small businesses that will be eligible for the investment incentives and the carryback provisions. There are over 10,000 people in Wentworth who have kept their jobs, through JobKeeper, and there are over 7,000 businesses that have benefited from the cashflow boost. There are 5,000 people who benefitted from the coronavirus supplement, and over 6,000 aged pensioners will receive the additional support payments.

There is also additional funding through the Local Roads and Community Infrastructure Program, which will benefit community infrastructure projects in Wentworth, from walking paths and bike lanes through to picnic shelters. Woollahra Municipal Council, Waverley Council, the City of Sydney and Randwick City Council will, together, receive an additional $15 million to spend on local infrastructure and community upgrades by the end of 2021. I'll be working closely with local mayors and councillors to identify high-priority projects.

This has undoubtedly been a challenging year for governments and nations around the world. We, in Australia, should each feel proud, each one of us, of how we have performed so far. We have good reason to feel confident about our future. This budget is another important step towards a post-COVID Australia, and I commend it to the House.

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