Tasmanian Country Article - 28th October - The budget

This article appeared in the Tasmanian Country Newspaper on 28th October 2022

This week, to be totally predictable, I’m going to discuss the Federal budget. Firstly I would like recognise the analysis contributions from the National Farmers Federation (NFF), Australian Dairy Federation (ADF), Cattle Council and the TFGA team. I know Wednesday was a late night for us at the TFGA and many organisations; dissecting the budget in order to clarify the ramifications for our members and Australian agriculture more broadly.

On the whole, the budget presented a stronger overall position than expected. In reality this was not a result of great political management, but geopolitical influences. For example, stronger employment figures and higher commodity prices have give The budget a boost of more than $40 billion. To counteract this burst of positivity, the budget was hit by underestimated social services spending (the largest overall budget item) and, understandably, an underestimated defence investment (think Ukraine and China tensions).

The economy is facing escalating inflation and operating in the hangover of reining in the COVID 19 spend-fest.

This budget offers few truly new funding announcements for agriculture and Tasmania. Most of the spending relating to agriculture has been previously unveiled at the Job and Skills Summit or through previous biosecurity announcements regarding foot and mouth disease. Still, let’s take a look at a few of the key budget impact areas.

Tasmanian Irrigation

In one of the big wins, Tasmanian Irrigation Limited has secured an additional $100 million for tranche three irrigation projects. Six tranche three projects are currently being advanced: Don, Northern Midlands, Tamar, Southern Midlands, the Greater South East and an augmentation of the Sassafras Wesley Vale Irrigation Scheme. This funding will enable work to progress on these important irrigation projects, which will more than double

Energy

When it comes to energy, the budget has two key points to note:

1. $20 billion in funding to establish the Rewiring the Nation project, which aims to expand and modernise Australia’s electricity grids, unlocking new renewables and storage capacity and driving down power prices.
2. $62.6 million over three years from 2022–23 to support small-to-medium enterprises to fund energy efficient equipment upgrades. This funding will support studies, planning, equipment and facility upgrade projects to improve energy efficiency, reduce emissions or improve the management of power demand.

Power bills are on the way up, a 30% increase is forecasted, it will be interesting to see how locally this impacts us in Tasmania. Generation costs for our power shouldn’t be increasing but the price the power is worth on the national grid is going up….watch this space.

The $20 billion, announced last week, will impact Marinus Link and TasNetworks transmission expansion plans,. It is worth noting the funding is in the form of low-interest loans, not grants. So, as a State, we will need to pay this loan back.

Workforce

The Government will increase the 2022–23 Permanent Migration Program planning level from 160,000 to 195,000 (again this was released post the Jobs and Skills Summit).

The Government will provide $67.5 million over four years from 2022–23 (and $12.4 million per year ongoing from 2025–26) to expand and enhance the Pacific Australia Labour Mobility (PALM) scheme. The TFGA did not welcome this election commitment, as it effectively abolishes the proposed Agriculture Visa.

The Government has committed $76.4 million over four years from 2022–23 for outcomes from the Jobs and Skills Summit to help build a bigger, better-trained and more productive workforce, boost real wages and living standards, and create more opportunities for more Australians. As previously noted in our post regarding the Job and Skills Summit, $42.2 million over two years from 2022–23 for the Department of Home Affairs to increase visa processing capacity.

The Government will provide $921.7 million over five years from 2022–23 to strengthen Australia’s Vocational Education and Training system and address skills shortages. This includes providing 480,000 fee-free Technical and Further Education (TAFE) and vocational education places in industries and regions with skills shortages. I have mixed feelings about this announcement. Tasmania has a gap in our vocational and technical training. We just don’t do enough of it. In addition to this, I’m not sure the TAFE curriculum meets the needs of Tasmanian agriculture.

The Government will provide $61.9 million over two years from 2022–23 to provide aged and veterans pensioners a once-off credit of $4,000 to their Work Bonus income bank. The temporary income bank top-up will increase the amount pensioners can earn during 2022–23, from $7,800 to $11,800, before their pension is reduced. This supports pensioners who want to work, or work more hours, to do so without losing their pension. As I have said before, for me this just doesn’t go far enough. Tasmania needs the cap removed. Tasmania has a disproportionate aged population compared with the rest of Australia. Nationally we face ballooning cost of living pressures. Enabling older Tasmanians to work more if they want to would be a step in the right direction for all involved.

Animal welfare

The Government will provide $4.0 million over four years from 2022–23 to establish an Inspector General of Animal Welfare. We expect this will be an expansion of Inspector General of Live Animal Exports to cover all animal welfare standards and reporting. I would like to see more information regarding this announcement and will keep you posted as more information comes to light.

Biosecurity

The Government will provide $134.1 million over four years from 2022–23 (and $3.3 million per year ongoing) to bolster biosecurity capability. This comprises:

1. $61.6 million over two years from 2022–23 to strengthen Australia’s frontline biosecurity capability, including enhancing the domestic detection and response capability in northern Australia, supporting domestic preparedness and biosecurity outcomes in neighbouring countries.
2. $46.7 million over three years from 2022–23 to improve on-farm biosecurity and support the transition to a national livestock traceability system.
3. $14.0 million in 2022–23 to improve Australia’s biosecurity systems and provide support for neighbouring countries battling foot and mouth disease and lumpy skin disease.
4. $11.7 million over four years from 2022–23 (and $3.3 million per year ongoing from 2026–27) for expanded detector dog capability at Australia’s borders.

This is a mix of mostly old announcements with a bit of new money regarding detector dogs.

Health and aged care

The Government has committed $61.8 million over six years from 2022–23 to fund local health investment projects across rural and regional locations to improve primary care outcomes and reduce the pressure on hospital emergency departments.

An additional $143.3 million will be delivered over four years to support access to healthcare in rural and regional areas, by investing in primary care services, training, workforce incentives and trials for innovative models of care.

Tasmanian rural health desperately needs support. It is not an area I know enough about, but we will watch closely for further detail on these announcements.

Climate change

The Government will provide:

1. $8.1 million over three years from 2022–23 to support the commercialisation of seaweed as a low-emission feed and support projects that lower barriers to market entry.
2. $141.1 million over 10 years from 2022–23 as part of a realignment of investment in carbon capture technologies.
3. $20.3 million over four years from 2022–23 to establish an outreach program to empower Australian farmers and land managers, including First Nations peoples, to participate in carbon markets and integrate low-emission technologies and practices.
4. $47.1 million over four years from 2022–23 (and $13.6 million per year ongoing) in additional funding for the Climate Change Authority and the Department of Climate Change, Energy, the Environment and Water.

Telecommunications

The Government will provide $757.7 million over five years from 2022–23 to improve mobile and broadband connectivity and resilience in rural and regional Australia. Key initiatives include:

1. $200.0 million over five years from 2022–23 for two additional rounds of the Regional Connectivity Program, to fund the delivery of telecommunications infrastructure to improve digital connectivity in regional, rural and remote Australia.
2. $40.0 million over three years from 2022–23 through the Mobile Black Spot Program, implementing commitments for new mobile infrastructure to improve mobile coverage and reception quality across Australia
3. $30.0 million over five years from 2022–23 for the On Farm Connectivity Program to support farmers and agricultural businesses to buy and install on-farm connectivity equipment.

Many of our members struggle daily with connectivity. Let’s see if any of these programs make a difference.

Again I would like to thank NFF, ADF, Cattle Council, and the TFGA teams for the comprehensive budget breakdown. On a sneaky side note, if asked what do I think was a missed opportunity in this budget? A better tax regime for Australia’s gas resources – heaven forbid we should get more money from resources we actually own.

Ian Sauer
TFGA President