The Federal Government just announced their 2023-24 budget. Here’s who came out on top, and who was left behind.
The Federal Budget has dropped for the 2024-25 financial year, and boy oh boy is it a juicy one.
It’s the second time in 15 years that the Federal Government has forecasted a budget surplus, this time of $9.3 billion.
This is the Labor Government’s second budget, and once again cost-of-living is a major priority on their agenda.
Now, there is a tonne in this budget, we’re talking over 900 pages.
But we’ve done the hard yards for you, and pulled together the major takeaways from this year's budget, so you know exactly what’s going to impact you.
In this budget, we’ve got cost-of-living relief, investments into healthcare, HECS-relief, and future-forward industries.
Winners:
Probably one of the most popular discussions around the budget has been the changes to Stage Three tax cuts, which will come into effect July 1.
Under these changes, every Australian resident will get a tax cut, but those earning less than $150,000 will get more than what they were going to get under the original Stage Three tax cuts plan.
The average tax cut per person is expected to be $1,888 in 2024-25.
The government’s aim with these changes is to give higher tax cuts to lower income earners, and support Aussies with high cost of living.
The reforms will reduce the 19 per cent tax rate to 16 per cent and reduce the 32.5 per cent tax rate to 30 per cent.
On the other hand, it will raise the threshold at which the 37 per cent tax rate applies from $120,000 to $135,000 and raise the threshold at which the highest rate of 45 per cent applies from $180,000 to $190,000.
The Federal Government is reducing the average HECS debt of $26,500 by $1,200.
As part of this Budget, the Government is planning to wipe out $3 billion worth of HECS debt for 3 million Australians, and is changing how HECS will be calculated moving forward.
In the future, your HECS debt will be indexed based on whichever is lower out of inflation or wage growth, so that student debts can’t go up faster than the average wage.
For example, last year, inflation was 7.1% and wage growth was just 3.2%, But with this new change, your HECS debt will be indexed to wage growth, as it is lower.
And this new law will be backdated to last year’s HECS indexation.
If you’re a renter or home-owner, then the government is tipping into your energy bill to help you out.
Yep, the average energy bill in Australia has increased by 26% over the past 12 months
Now, the federal government is giving every Australian household $300 in energy bill relief. This will come in the form of $75 discounts for each quarterly bill over the next financial year and will cost the government $3.5 billion.
And if you’re a small business owner, you’ll also be entitled to a rebate. This time, it’ll be $325 rebate for the one million small businesses.
The health sector is getting a chunky boost of $8.5 billion over the next four years.
That includes:
The government is investing $925 million over the next 5 years to support victims of domestic violence.
As part of the program, victims of domestic violence will be able to receive up to $5000 in financial support to allow them to safely leave domestic violent situations.
The government wants to make sure parents dedicating years of their lives to raise screaming small humans get some relief during retirement.
So in this Federal Budget, they’ve announced an investment of $1.1 billion in 2025, and $600 million per year from then on towards super contributions for workers on paid parental leave.
Currently, on the government’s paid parental leave system, parents don’t have a right to superannuation payments.
But that is about to change. As part of this budget, about 180,000 families per year will get an extra 12% of superannuation on top of government-funded parental leave.
As part of this new Budget, tertiary students who have mandatory placements as teachers, nurses, social workers, or midwives are going to receive a $320 weekly payment during their mandatory placements.
This new initiative is going to impact over 73,000 tertiary students, many of whom give up casual/part-time work when doing their mandatory placements.
The payment will be means tested and begin from July 1 next year.
This budget includes almost $2 billion across the next five years to increase rental assistance.
This will raise the maximum rate of Commonwealth Rent Assistance by an extra 10%
And it’s the first time the maximum rate has been increased in two back-to-back budgets for more than 30 years.
Last-minute holiday-makers (or those who forgot to renew their passport) will be able to fast-track their passport applications from July 1 this year.
As part of the last-minute booking, travellers will be able to get their passport within five-days. It will cost applicants $100, and is estimated to generate $27.4m in the five years to 2028-29.
Losers
With Australia in the midst of a housing crisis, aspiring homeowners were hoping that the government would deliver some improvements to the situation.
But as part of this budget there are no big changes to provide relief (ie changes to negative gearing).
This is despite the fact rents have risen by more than 75% since the start of the pandemic.
The number of international students enrolled in Australian institutions will now be capped.
Australia institutions that want to take students above these caps will be required to provide purpose-built student accommodation.
The idea is to reduce the burden that international students place on the limited supply of housing for young Australians.
NDIS costs have been projected to rise from $44.3bn in 2024 to more than $90bn by 2030.
As a result, the government is exploring ways to cut the growth of the scheme.
The government will overhaul how funding plans for NDIS recipients are approved and what supports can be funded.
The overhaul will reduce the growing NDIS figure by $14.4bn over the next four years
The government plans to halve the net migration intake from 528,000 last year to 260,000 next year. The reason for this is to take pressure off the housing market.
It’s not a good time to be a government consultant or contractor.The government is planning to cut spending on consultants, contractors and labour hire by $1 billion in 2024-25 budget.
The government is planning to rebuild Australia’s public service sector than relying on external organisations and individuals.
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