The Highlights – 2021 Budget Breakdown

The Victorian Government will offer stamp duty discounts and spend close to $50 billion on other concessions, subsidies and projects in a bid to get hundreds of thousands of people back to work and breathe new life into a State economy battered and bruised by the coronavirus pandemic. So let’s look at the 2021 Budget Breakdown.

Treasurer Tim Pallas says ‘it will go down in history as the Budget that kept Victoria afloat’. The Government has set a goal of creating 200,000 jobs by 2022 and 400,000 by 2025, focusing on those hardest hit by the disruption wrought by COVID-19. To help it achieve its goal, the Government has committed $250 million to subsidise the wages of at least 10,000 workers.

1. Property Buyers

People who buy residential properties for under $1 million before June 30, 2021, will get some relief on stamp duty. It was a measure included in last year’s budget and was meant to come in from July 2023, but has been brought forward to next January.

  • A waiver of 50 per cent will apply for new residential properties, and 25 per cent will apply for existing properties.
  • A 50 per cent stamp duty concession will also apply to the purchase of commercial and industrial properties in regional Victoria.
2. Job Seekers

Hundreds of millions will be spent on programs to support jobseekers and encourage businesses to hire. $250 million will be spent on subsidising the wages of up to 10,000 new workers. $150 million of that will go towards employing women specifically, and $50 million of that will go to women over the age of 45.

Under a New Jobs Tax Credit plan, businesses will get 10 cents for every dollar they increase taxable Victorian wages.

  • The Budget contains further funding of $266.5 million for intensive individual support for jobseekers, such as career counselling and help to update resumes, as well as an extra 80,000 free TAFE and training places in courses linked to in-demand jobs.
  • There’s also a $64 million Digital Skills and Jobs program to help retrain Victorians who lost their jobs, which will fund short courses and up to 5,000 industry internships.
3. Health

More than $2 billion will be spent building new hospitals and upgrading existing ones, including:

  • $562 million to expand the Frankston Hospital in Melbourne’s south-east
  • $384.2 millon the first stage of the Warrnambool Base Hospital redevelopment
  • $217 million for the Latrobe Regional Hospital redevelopment
  • $75 million to buy land and start planning a new hospital in Melton, a fast-growing region in Melbourne’s west

The 2021 Budget and how we breakdown it also includes $200 million to set up a new Metro Health Infrastructure Fund, and the existing Regional Health Infrastructure Fund will get an extra $120 million. There’s also $30 million to update clinical technology like pathology and diagnostic tools, and $85 million for engineering and medical equipment upgrades.

Just over $66 million will be spent planning and buying land for new community hospitals across Cranbourne, Pakenham, Torquay, City of Whittlesea, Eltham, Fishermans Bend and Point Cook. One of the key points for our 2021 Budget Breakdown.

4. Social Housing

The Victorian Government will spend $5.3 billion on building 12,000 homes over the next four years. Construction on some projects will start immediately and a quarter of the funding will be allocated to regional Victoria. The package will create 9,300 new social housing homes, including 2,000 specifically for Victorians with mental illness. More than 1,000 old public housing units managed by the state will be replaced. The package will also build 2,900 low-cost homes for low-to-moderate income earners.

5. Power Users

Victorians will get access to a number of measures to make their homes more energy efficient, as part of a $797 million household energy efficiency package.The package includes $191 million to expand the state’s solar power rebate scheme and $335 million to help low-income earners replace old heating appliances. It also includes $112 million to upgrade energy systems for 35,000 social housing homes.

Eligible concession card holders will get a one-off $250 payment to help cover electricity bills. The Government estimates this will help 950,000 Victorian households.

6. Regional Tourism

Premier Daniel Andrews has encouraged Victorians to travel in their own State this summer — and the Budget includes a few measures to sweeten the deal. A $465 million tourism recovery package will see tourist hotspots around the state get funding for upgrades and projects.

From December, 120,000 vouchers of $200 value will be available for Victorians who spend at least $400 on accommodation, attractions or tours in the regions. The package also includes $47.5 million for the Great Ocean Road region, $18.5 million for Gippsland, $15 million for the Falls to Hotham Alpine Crossing hiking trial, $13 million for the Grampians and $4.3 for the Prosecco Road winery district.

7. Schools

There are billions in the budget for schools, with measures ranging from infrastructure projects to support for students with disability. All up there’s more than $3 billion allocated for school infrastructure upgrades, including more than 4,830 jobs related to projects in metropolitan Melbourne and more than 1,570 jobs related to projects in regional Victoria.

More than $147 million has been allocated to buy land for 11 new schools, and $122.4 million will be spent on a new vertical primary school in North Melbourne. There’s also $1.6 billion for a Disability Inclusion package, which will expand the support available to students with disability.

Families who were loaned laptops and iPads to help them access online learning during the lockdown will be allowed to keep them under a $24.5 million fund included in the budget. The funds will be made available to schools to replace devices loaned out.

The Budget also includes $250 million to hire 4,100 tutors across government schools next year, to help students catch up after a school year disrupted by COVID-19.

8. Rail Projects

Billions of dollars has been allocated for transport infrastructure. There’s $2.2 billion for early works on the first stage of the Suburban Rail Loop, which will run between Cheltenham and Box Hill. The Melbourne Airport Rail Link will also get $5 billion from the State Government, which is being matched by the Federal Government.

The State Government will also match the Federal Government’s $2 billion commitment to the Geelong Fast Rail project. Other rail projects include:

9. Women

As part of a $250 million package subsidising the wages of 10,000 new workers, there’s $150 million for women specifically — and $50 million of that for women over 45. The Victorian Government will also offer free kinder in 2021 — a $169.6 million scheme aimed largely at helping women return to work.

A few measures are also targeted at getting women into male-dominated industries. The Government will spend $2.4 million to encourage women to join the transport sector workforce through scholarships and career development initiatives. The social housing package will use social procurement targets to hire women, Aboriginal Victorians, people with disability, and Victorians from diverse backgrounds.

10. Road Network

This Budget is investing $450 million in a road maintenance blitz, maintaining, repairing and resurfacing roads across metropolitan and regional Victoria. This includes an investment of $35 million to strengthen bridges and replace older intelligent transport systems.

A further $17 million will upgrade freight routes for farmers and processors in Victoria’s vital south‑west dairy supply chain, saving them time and money. And to help support our broader economic recovery, this investment is expected to support over 50 jobs at the peak of construction. Other key improvements to our road network include:

  • $255 million to enable a five‑year program of upgrades to the iconic Great Ocean Road
  • $241 million to complete Stage 3 of Princes Highway East duplication between Traralgon and Sale
  • $117 million to fund metropolitan road and intersection upgrades
11. Support for Business

Significant support has been provided to businesses, including providing grants to the industries hardest hit, cutting taxes and fees and providing additional support to help during the pandemic. This support includes:

  • $2.6 billion in grants from the Business Support Fund to support the hardest‑hit sectors including hospitality, tourism, accommodation, creative industries, and retail
  • More than $2 billion in tax deferrals, including allowing businesses with payrolls of up to $10 million to defer their 2020-21 payroll tax liabilities for up to 12 months. This represents a $1.7 billion cash flow boost to businesses in 2020-21
  • More than $1.8 billion in relief from taxes and fees, including a full refund and waiver of 2019-20 payroll tax for small and medium businesses, providing cash back in their bank accounts when they needed it most.
  • Freezing and waiving a number of taxes and charges – 2020 and 2021 liquor licence fees have been waived, while the 2020-21 Fire Services Property Levy was frozen at the 2019-20 revenue target. Increases to the landfill levy have also been deferred
  • The $100 million Sole Trader Support Fund to help sole traders in affected sectors
  • $92 million over the life of the program for carbon farming on private and public land by incentivising the restoration of native vegetation and carbon plantings. This will also deliver jobs and improve productivity for our farmers

The Government will also increase the threshold for paying payroll tax on an annual basis from $40,000 to $100,000 reducing administration costs and providing $309 million of cash flow support to 7,000 businesses. And for the very first time, small businesses will also be eligible for Solar Homes, with up to 15,000 rebates available to help reduce energy costs.

12. Mental Health

The Victorian Government will spend $868.6 million to overhaul the mental health system, and act on several recommendations from the Royal Commission’s interim report. The funding includes $492 million for 120 mental health beds in Geelong, Epping, Sunshine and Melbourne.There’s also $152 million to provide mental health services in direct response to the pandemic and $47.8 million for early intervention support for young people.

There is our 2021 Budget Breakdown. This is short snapshot into the new budget. If you would like to read more, please  download a copy of the Budget Summary here

We have 3 articles for our 2021/2022 budget. For individuals, for Superannuation and for Business Owners.