On 25 October, Treasurer Jim Chalmers handed down Australia’s Federal Budget 2022, including a ‘historic’ of state and federal funding commitments for 20,000 new affordable dwellings.
Here’s an overview of the Federal Budget 2022 and how it pertains to the construction and housing industries.
New Housing Accord
- All states and territories are being brought together, along with the Australian Local Government Association, investors, and representatives from the construction sector, to create new national Housing Accord.
- Under the Accord, state and territory governments will undertake expedited zoning, planning and land release to deliver on a joint commitment to improve the availability of social and affordable housing in well-located areas, including looking for immediate opportunities to free up well-located state land.
- The Accord sets an aspirational target of one million new, well-located homes to be delivered over 5 years from mid‑2024 as capacity constraints are expected to ease.
- The Government will provide $350 million over 5 years, with ongoing availability payments over the longer term, to deliver an additional 10,000 affordable dwellings.
- Dwellings under the Accord will also be increased to 20,000.
- The Australian Government has secured endorsement from institutional investors, including superannuation funds, for the Accord. Investors will work constructively with Accord parties to optimise policy settings that facilitate institutional investment in affordable housing.
- The Accord builds on the Government’s $10 billion investment to establish the Housing Australia Future Fund. Returns from the Fund will be used to build 30,000 new social and affordable dwellings over 5 years.
National housing updates
- The National Housing Supply and Affordability Council will be commissioned to review barriers to institutional investment, and innovative financing models in housing (for example, Build to Rent).
- The Australian Government will extend the Australian Skills Guarantee (including any sub-targets, for example, women) to include apprentices on Government-funded housing projects.
- The National Housing and Homelessness Plan will establish a clear national strategy to make it easier for Australians to buy a home or rent, and to put a roof over the heads of more homeless Australians.
- The Australian Government is also providing $15.2 million to establish a National Housing Supply and Affordability Council to independently advise the Australian Government on housing policy.
- The Government is expanding the remit of the National Housing Infrastructure Facility to allow it to use more flexibly $575 million of existing funds. This will help unlock a projected 5,500 new dwellings.
- The Regional First Home Buyer Guarantee will help 10,000 eligible first home buyers a year in regional Australia to buy a home with as little as 5 per cent by guaranteeing up to 15 per cent of the purchase price.
- Under the Help to Buy shared equity scheme, eligible home buyers will have access to an equity contribution to buy a home with a smaller deposit and a smaller mortgage.
- The Government is extending the exemption of home sale proceeds from pension asset testing from 12 months to 24 months and is also expanding access to make ‘downsizer’ contributions to superannuation for people aged 55 to 59.
- The Government is committing $46.2 million to expand the Defence Home Ownership Assistance Scheme. This will support veterans and Australian Defence Force members to purchase a home through monthly subsidies on mortgage interest payments.
Disaster resilience and preparedness
The Government is investing up to $200 million per year on prevention and resilience initiatives through the Disaster Ready Fund. The Fund will support projects such as flood levees, sea walls, cyclone shelters, evacuation centres and fire breaks.
Supporting small business
The Government is committed to delivering on its Better Deal for Small Business, including:
- Strengthening unfair contract term protections
- Collaborating with the small business community to address opportunities and challenges including through September’s Jobs and Skills Summit.
The Government will work with small business, unions, workers and industry to deliver a simpler, more accessible and fairer workplace relations system. This includes removing complexity to help small businesses reach agreements with their employees, providing bargaining support for small businesses and assisting small businesses to implement new family and domestic violence leave entitlements for their employees.
Supporting small business well-being
The Government is providing $15.1 million to extend the tailored small business mental health and financial counselling programs, NewAccess for Small Business Owners and the Small Business Debt Helpline. These programs have assisted many small businesses through the challenges of COVID-19 and recent natural disasters.
Driving regional growth
- Through its new regional Precincts and Partnerships Program, the Government will work with states and local councils to invest in place-based projects that transform regional centres.
- Through its Priority Community Infrastructure Program and its Investing in Our Communities Program, the Government will provide $1.4 billion for local community, sport and infrastructure projects across Australia.
Community batteries and solar banks
The $224.3 million Community Batteries for Household Solar Program will assist up to 100,000 households to reduce their power bills by delivering up to 400 community batteries to store excess solar energy for when it is needed most. The Government is also providing $102.2 million for the Community Solar Banks program to help up to 25,000 households access cheap solar-powered energy.
