Construction Industry Responds to Federal Budget 2020

Federal Budget 2020/21 | Building & Construction Industry Responses

In his Budget speech, Treasurer Frydenberg told Parliament that "rebuilding our economy includes building more roads, rail and bridges". He pledged to “support thousands of jobs in the construction industry” and “support the construction of affordable housing”. Construction industry representatives have welcomed the focus on construction, while the Opposition has called for greater focus on social housing construction.

Master Builders Association:

The Master Builders Association of Australia welcomed measures in the Budget designed to boost confidence in the building and construction sector, which employs one million people. “Making building and construction the keystone of Covid recovery is the right call by the Government,” Denita Wawn, CEO of Master Builders Australia said in a press release:

“Productivity enhancing infrastructure, including local community infrastructure wage subsidies and massive tax incentives for builders and tradies to invest means the Government is putting in place the right foundation for recovery,” Wawn said. “The extension of the First Home Loan Deposit scheme and the $1 billion for the construction of new affordable housing will extend the opportunity to own a home to thousands more people for whom it seemed out of reach. It will unlock even more investment and further activate residential building as the engine of economic growth and employment.”

Housing Industry Association:

Graham Wolfe, managing director of the Housing Industry Association (HIA) has welcomed the Budget, telling brokernews.com.au that it will be an effective means to both boost the home building market and make home ownership more attainable. “Tonight’s budget has given both first home buyers and more than one million workers in the residential building industry the incentive and confidence needed to continue to navigate through these challenging times,” he said. “By increasing the number of people eligible for the First Home Loan Deposit Scheme by 10,000, focusing on new home builds, and raising the price thresholds, the government has opened the door to a larger group of first home buyers,” Mr Wolfe said.

Banking Sector:

The NAB bank has written that $11bn in infrastructure spending was announced in the Budget, with construction being the real winner: “The Construction sector was a winner in this budget, with measures to stimulate building across the country in a bid to create jobs and increase cashflows right now. This includes the $688m HomeBuilder scheme, which provides eligible owner-occupiers with a grant of $25,000 to renovate or build new homes. The First Home Loan Deposit Scheme will also be expanded to give an additional 10,000 places to potential first home buyers who will be able to purchase a new home sooner under the extension. Builders will receive extra benefits from the expansion as part of the conditions of the First Home Loan Deposit Scheme is to purchase new dwellings.”

NAB also noted that “The JobMaker hiring credit, slated for $4b over 3 years coupled with a boost to the Supporting Apprentices and Trainees subsidy, slated for $1.2b over 4 years, will be of welcomed benefit for the construction industry. With new and old trainees’ wages subsidised to 50% (capped at $7000 per quarter) till September 2020, coupled with an additional $200 per new employee aged between 16 to 29 or $100 for those between 30 to 35, the construction industry will be able to expand quickly to meet expansion in the construction sector.”

CFMEU:

A statement from the CFMEU National Construction Division says the “The 2020 Federal Budget is a missed opportunity to spark a construction boom in the social and affordable housing.” Dave Noonan, CFMEU National Construction Secretary said: “While delivering tax cuts and reforms for some industries, Josh Frydenburg has missed the opportunity to end the inequitable application of GST on build-to-rent housing which acts as a significant barrier to its construction in Australia.”  

Opposition Budget Reply:

Opposition Leader Anthony Albanese delivered his budget reply speech on Thursday. In relation to construction, he committed to spending $500 million to repair 100,000 public housing dwellings, which he said would "create thousands of jobs in construction and the trades". He also announced that a Labor government would spend $20 billion on upgrading Australia's poles and wires to better connect the electricity grid to renewable energy.

- Compiled by Hume Building Products.