If saving is too hard – spend big! – 2017-18 Federal Budget

If saving is too hard – spend big! – 2017-18 Federal Budget
May 8, 2017 OPR

There is nothing like spending on nation building projects to deliver the Government’s new mantra of don’t tell but show. The Turnbull Government heard loud and clear that innovation was intangible and un-relatable to the common man. Yet, building things – big things like airports, roads, train lines, hydro power stations and ships – well, we can all relate to that.
Infrastructure – As part of Treasurer Scott Morrison’s “good debt” – roads, major rail projects and Western Sydney’s Badgerys Creek airport have already been touted a big ticket items in this year’s Budget. The Government confirmed it will go it alone to build the $6 billion second airport in Sydney, on top of a $9 billion infrastructure allocation. The inland railway from Melbourne to Brisbane is also expected to feature as a pet project for the Nationals, and potentially the cross-river rail in Brisbane.
The already committed bucket for Defence and its national ship building focus is starting to kick some goals for the Government and it is keen to see this enthusiasm flow onto other large infrastructure projects.
Education: Prime Minister Malcolm Turnbull has outlined plans to boost funding from $17.5 billion to schools in 2017 to $30.6 billion in 2027, in what has been dubbed “Gonski 2.0”. The Coalition is reporting schools will see an extra $2.2 billion over four years, alongside a needs-based system to determine funding, leaving thousands of schools better off. Although it will deliver benefits for almost all schools, more than 300 independent schools will experience a lower share of extra funding, while 24 independent Catholic and private schools will have their funding cut.
On the flip side, university students have been told to prepare for a hike in fees for certain courses and to prepare to start paying back their degree earlier. HECS debt used to be paid off when salaries hit $55,000, but this will be reduced to $42,000. Overall, university funding will be cut by hundreds of millions based on a report that found universities were adequately funded and experienced growing revenue.
National Security: The announcement today of bid spending for the Australian Federal Police (AFP) is going back to ‘making our nation safe’ and has been positioned to combat terrorism, drug trafficking and people smugglers. Funding will also be used to divert foreign aid funds to the Intelligence agencies as part of an unprecedented national security budget package.
Regional Australia: Feeling the pressure of the rise of One Nation in the bush, Nationals’ Leader Barnaby Joyce has been demanding more investment for regional Australia – and he looks likely to get it. Leveraging his party room numbers, the Budget will see concessional drought loans for farmers, funding to address mobile black spots and new dams and weirs as part of the establishment of a regional investment corporation.