Treasurer Scott Morrison handed down the 2017-18 Federal Budget in Canberra last night. Agriculture fared well, but what are the main things to know for the farm sector?
First, the politics…
The 2017-18 Budget is being hailed as a strategic reset for the Turnbull Government.
Politically, it aims cure the hangover of the disastrous 2014 Budget, and take the fight to Labor on fronts like health and education where the Coalition has struggled to gain the public’s trust.
Has it worked? Well, early indications are good – with a positive response from most stakeholder groups. But history tells us that the work for the Government has just begun.
The 2014 Budget was also met with muted applause on Budget Night. But that quickly soured as the impact of cuts sank in and the Government floundered in selling its narrative.
Making a statement on issues like health, education and infrastructure hasn’t come cheap. And with economic growth tracking lower than last year’s forecast, the expected date for the budget to return to surplus has moved back 12 months to 2020-21.
A rail tale
The budget went big on rail spending this year. Really big.
The Government exceeded the hopes of most stakeholder groups (us included) and stumped up the full amount needed to build the Melbourne to Brisbane Inland Rail line.
That’s $8.4 billion which will flow to the Australian Rail Track Corporation to complement existing funding and a private investment component.
This is a big deal, and has been a long time coming. When the line is completed in 2024-25, it will shave 10 hours off the existing Melbourne to Brisbane rail time – making it competitive with road transport, meaning less trucks.
The project should reduce the cost of getting key farm commodities to export markets – a great outcome for farmers.
All this excitement though could quickly go south if a responsible approach isn’t taken to community consultation. New stretches of track will require land acquisition and we’ve told the Government firmly that they need to learn from the mistakes of the coal seam gas industry and have an open conversation with those affected.
Outside of Inland Rail, funding has also been announced for Murray Basin Rail, regional Victorian rail upgrades, and business cases to assess new rail connections between major cities and regional centres.
The Budget announced that accelerated depreciation provisions for capital expenditure less than $20,000 would be extended for another 12 months. It will also apply to businesses with a turnover of less than $10 million – up from the previous $2 million.
This is a great win for the farm sector, following a community campaign via AustralianFarmers to see these provisions extended.
While we hoped for an extension greater than 12 months, we’re pleased to see that the hundreds of people who contacted the Treasurer as part of our campaign weren’t ignored.
Funding love for Landcare
A collective sigh of relief was breathed last night, as we saw an ongoing commitment to fund the next phase of the National Landcare Programme.
Landcare will receive $1 billion over 5 years to continue its important work, and Government has committed to partner with organisations like NFF to design the next phase of the programme (due to start in 2018-19). Stay tuned, as the next 12 months will see important decisions made about sustainable agriculture funding.
In the meantime, we have $100 million from the Backpacker Tax resolution slated for on ground projects this year.
New fund for regional growth
The Budget contains $472 million for a new ‘Regional Growth Fund’.
What does that mean? Well, $200 million of it is heading directly to the Building Better Regions Fund. That’s an existing programme that helps regions with new infrastructure, strategic plans, events and more.
The other $272 million will be doled out directly by that fund for major infrastructure projects exceeding $10 million. The aim is to help regional communities undergo structural adjustment so they can grow their economies.
Is that all?
Well, no. There is so much more we could tell you about, like:
- funding for environmental studies of CSG-affected areas;
- plans to improve consistency for CSG-affected landholders;
- funding to improve systems for live export assurance;
- expansion of concessional loan arrangements for farmers;
- and much, much more…
But for now we’ll leave you though with the main thing we wished we saw in the budget, and that’s a focus on regional telecommunications.
We know how fed up our members are with the Data Drought, and at a minimum we would have loved to see a commitment to the Mobile Blackspots Programme beyond the next financial year.
Alas, there was no new money for Mobile Blackspots, or any other regional telecommunications efforts for that matter.
For that, we had to mark down what was otherwise a budget that delivered well for the farm sector. We’ve labelled it a ‘solid B+’.