As the dust settles on the 2021-22 Federal Budget, some of Australia’s key industry groups have weighed in with their responses.
In a big-spending Budget that shied away from the austerity measures of previous coalition governments, there was a heavy focus on housing and home ownership, as well as infrastructure, insurance and child and aged care.
The Real Estate Institute of Australia described Treasurer Josh Frydenberg’s third Federal Budget as “big spending and socially progressive”.
“Sustained strong performance in the housing sector is a good thing as Australia and the world enter the mid-pandemic stage as vaccination programs target herd immunity,” REIA President Adrian Kelly said.
The REIA was particularly vocal in its support of the 20,000 total new places for the First Home Loan Deposit and the expansion of the First Home Super Saver Program from $30,000 to $50,000.
The REIA also welcomed the recently announced $10 billion underwrite guarantee on the reinsurance pool, which it anticipated would reduce insurance premiums for 500,000 policy holders.
“REIA has long advocated for more climate mitigation measures to better protect Australian’s homes as we know that severe weather events like floods and fires will continue,” Mr Kelly said.
The REIA also reiterated its support of recent statements from the Reserve Bank and the Australian Prudential Regulation Authority (APRA) that neither organisation had any current plans for market intervention to put a halt to rising house prices.
“Budget 2021 confirms a positive outlook for buyers, sellers, investors and tenants as we pass another COVID-19 economic milestone,” Mr Kelly said.
RIDING ON THE UTE’S BACK
Master Builders Australia Chief Executive Officer Denita Wawn said the Budget would be heavily backed by builders and tradies.
“It will boost the confidence of the industry that the recovery can continue to largely ride on the ute’s back,” Ms Wawn said.
Ms Wawn said the Budget had linked good economic policy with good social policy.
“Home ownership is the key to economic security and vital for a strong economy,” she said.
“The Family Home Guarantee will be life-changing for single custodial parents, the vast majority of whom are women.
“Combined with 10,000 new places under the New Home Guarantee it will mean that the people who build new homes and the people that want them continue as the lynchpin of recovery.”
PROPERTY COUNCIL SAYS POPULATION GROWTH A LOOMING CONCERN
The Property Council of Australia broadly welcomed the 2021-22 Budget, with Chief Executive Officer Ken Morrison saying the Government’s “sensible approach” of targeted support measures would continue to stabilise the economy and boost industry confidence.
“But the budget papers reveal that population growth will quickly become an anchor for our economy,” he added.
The Property Council has called for a “major upscaling” of Australia’s quarantine and border processing capacity to boost these numbers in a COVID-safe way.
“Australia needs extra capacity to boost these numbers in a COVID-safe way in order to drive our long-term growth,” Mr Morrison said.
But although Mr Morrison identified population growth as a key concern, he said Australia’s economic stabilisation had been “nothing short of remarkable”.
“Gross Domestic Product growth remains strong and the measures in last night’s Budget will continue to fuel this recovery,” he said on Wednesday.
“Industry confidence will be boosted by the Budget’s tax cuts, new infrastructure investment, home ownership support and extended investment incentives.
“Our economic recovery has not happened by accident. There has been a clear plan and targeted interventions that have supported this resurgence.”
A POSITIVE DIFFERENCE
The Housing Industry of Australia said the Budget would make a positive difference to the lives of thousands of Australians.
HIA Managing Director Graham Wolfe said the pandemic had initially created uncertainty in the minds of many Australians and put their aspirations to own their own home at risk.
“This Budget will help in restoring confidence that people will retain jobs, train for new jobs and have the financial ability to own a home,” Mr Wolfe said.
“The measures provided since June last year for home building have directly helped to retain the jobs of over one million Australians whose livelihoods depend on the housing industry.”
Mr Wolfe also praised the Family Home Guarantee, saying it provided a realistic, targeted and practical way to assist single parents build their family’s future.
“While many people can service a mortgage, saving the extra money each week to build up a deposit is simply too hard,” he said.
“This scheme will meet a real need and support thousands of families to gain the security that comes with owning their own home.”
The HIA also welcomed the announcement of further places under the New Home Guarantee and First Home Loan Deposit Scheme.
“Secure housing and a secure job is a fundamental need for everyone. While the road to recovery after the pandemic is long, tonight’s announcements will give Australians more confidence that there is light at the end of the tunnel,” Mr Wolfe said.
“The announcement of a further 10,000 new places under the New Home Guarantee, introduced in last October’s Budget, is also an important step.
HITS AND MISSES
The Australian Institute of Architects expressed disappointment that the Government failed to take advantage of what the institute perceived as an opportunity for large-scale reform.
“In a Budget big on spending, there was little systemic change, thereby missing the chance to transform adversity into opportunity for lasting change,” the institute said in a statement.
The institute’s Chief Executive Officer Julia Cambage said the profession had hoped innovative measures would be announced that responded to the pandemic-induced economic and social upheavals of the past year.
“COVID-19 has completely changed our world, ushering in a ‘new normal’ for how we live, work and interact,” Ms Cambage said.
“This global pandemic cast the strengths and weaknesses of our economic and social systems into stark relief, demanding a wholescale rethink of the structures we need to ensure a healthy future.
“This Federal Budget, while very big on spending in a multitude of areas – many of which are genuinely welcome – does not underpin the type of system-wide reforms that will set us up for greater resilience.”
When it came to housing, the institute said it was disappointed at what it described as “the relatively minor new investment” of $124.7 million in boosting social and affordable supply.
“Australia faces a critical workforce shortage as Covid-19 will continue to put a handbrake on large temporary visa and migration inflows,” Ms Cambage said.
“People facing housing instability and homelessness will struggle to gain employment and will likely be under-employed.
“A stably housed, healthy and educated population is foundational to creating a productive workforce in the economy of any developed nation.
“New measures such as the Family Guarantee and extension of the First Home Loan Deposit Scheme will benefit the few, not the many and fail to address need across the full continuum of the housing spectrum.”