Highlights from the 2019-2020 State Budget
CCF QLD has reviewed the Queensland State Budget 2019-2020 and has outlined a summary from the perspective of the civil construction industry.
The budget highlights a continuing commitment to infrastructure funding, as well as some changes to business taxes, which will favour small and medium sized businesses. Queensland’s employment rate will continue basically unchanged and government debt will increase. The following summary reflects the impact to infrastructure, transport, business, economic growth and training and skills:
- Jobs supported by infrastructure 40,500;
- Total infrastructure program over four years $49.5B;
- Total spend on road and transport infrastructure 2019–2020 $5.6b;
- Building our Regions program (since 2015) $515m;
- Education and Training 2019–2020 $14.9B.
During 2019–2020 construction is due to commence on the section of the M1 Pacific Motorway between Varsity Lakes and Tugun at an estimated total cost of $1.03 billion.
Widening of the section of M1 between Eight Mile Plains and Daisy Hill from six to eight lanes is also expected to commence in mid-2020 at an estimated total cost of $749 million.
Work will continue on the construction of Cross River Rail – the 10.2km rail line between Dutton Park and Bowen Hills in Brisbane. The State Government has allocated $5.409 billion for the project.
The Queensland Government will continue to work with the Australian Government to deliver significant Bruce Highway upgrades aimed at improving safety, flood resilience and capacity along its 1,700km length. The 2019–2020 works include:
- $186 million to widen the Bruce Highway from four to six lanes, Caloundra Road to the Sunshine Motorway;
- $108 million to construct bridges and approaches on the Bruce Highway (Haughton River Floodplain) south of Giru between Horseshoe Lagoon and Palm Creek;
- $68.2 million for the Cairns Southern Access Corridor Stage 3 (Edmonton to Gordonvale) and Stage 4 (Kate Street to Aumuller Street) projects;
- $60 million to construct Mackay Ring Road (Stage 1);
- $29.1 million for the Rockhampton Northern Access (Stage 1) widening from two to four lanes;
- $160.8 million over four years has been allocated for the Beerburrum to Nambour North Coast Line railway duplication. The Australian Government has provided an initial $390 million towards the project; and
- $153.6 million to upgrade dams and water supplies in South East Queensland.
The Government also remains committed to rebuilding regional communities impacted by the northern Queensland floods and other recent natural disasters, with a critical element of the Government’s investment focused on improving existing infrastructure to improve the resilience of the state’s communities.
As part of the Building our Regions program, the Government has provided a boost of $70 million for local government regional infrastructure projects. This will take the total funding allocated to the program to $515 million. Already projects in the program have supported more than 2,400 jobs.
- $1.599 billion in capital grants in 2019–2020, including $50 million as part of the Works for Queensland program for infrastructure in regional communities.
To promote mining exploration and investment in the NWMP, the Government is providing:
- $30 million over two years to contribute towards the construction and operation of a new common user terminal at the Port of Townsville which will increase the capacity for containerised freight on the Mount Isa Line.
Department of Transport & Main Roads
The transport budget for 2019-2020 is 10.5% of the entire state budget and transport infrastructure accounts for 46% of all capital purchases.
As part of targeted road safety initiatives funding of $900 million has been set aside over the next four years.
A $280 million investment has been allocated to the Transport Infrastructure Development Scheme over four years. This investment will provide funding to local governments for the development of local transport-related infrastructure.
Economic growth for 2019-2020 will be 3.0%. A hefty portion of this growth will rely on exports.
There is a surplus of $841 million in 2018-2019 and a surplus of $189 million for 2019-2020.
Payroll tax exemption will rise from $1.1 million to $1.3 million for all businesses and payroll tax rate for regional Queensland businesses will decrease from 4.75% to 3.75%. Businesses with a payroll above $6.5 million are now required to pay 4.95% payroll tax (up from 4.75%). 13,000 business benefit from lower payroll tax and 6,000 lose out from higher payroll tax.
The 50% payroll tax rebate is being extended on the exempt wages of apprentices and trainees until 30 June 2021.
From 1 July 2019, the Government is introducing a 1% discount on the relevant payroll tax rate for businesses that have more than 85% of their employees outside South-East Queensland.
From 1 July 2019 until 30 June 2021, the Government is introducing up to $20,000 rebate off the payroll tax on additional employees that businesses can demonstrate they have employed over and above their level of full time employees.
The petroleum royalty rate will increase by 2.5% to 12.5% from 2019-2020 onwards.
From 1 July 2019, the Government will increase land tax rates for companies, trusts and absentees by 0.25 cents for each dollar above $5 million, and 0.25 cents for each dollar above $10 million.
From 2019-2020, the land tax absentee surcharge rate will rise by 0.5% and application of the surcharge widened to include foreign corporations and trustees of foreign trusts.
Tax revenue in 2019-2020 will increase by 8.3%
The public service will employ approximately 4,000 people more in 2019-2020 than the previous year.
The State’s unemployment rate is expected to remain at 6%.
General Government borrowings are estimated to be $32.8 billion in 2019-2020 and General Government plus GOC borrowings in 2019-2020 are estimated to be $78.7 billion.
The debt to revenue ratio is increasing from 105.5% ($71.4b) in 2018-19 to 122.5% in 2022-23 ($90.7b). Queensland would need to pay-off approximately $11 billion in debt to get its AAA credit rating back.
Infrastructure spending as a percent of Gross State Product (GSP) will decrease to 2.7% from 2.9%.
Skills & Training
- $80 million allocated in 2019–2020 as part of a $420 million, six-year commitment to the Skilling Queenslanders for Work program. The Program helps eligible Queenslanders to develop skills, gain qualifications and provides direct assistance to enter and stay in the workforce. The initiative offers several programs that deliver training to improve skills and employment opportunities for Queenslanders.
- $11.2 million over four years for an expansion of the Regional Youth Engagement Hubs program to locate, case manage and re-engage early school leavers back into school and training.
- $199 million for the User Choice – Apprentice and Trainee Training Subsidy which provides funding of between $1,150 and $50,720 to be used towards the costs of training and assessment for eligible Queensland apprentices and trainees.
- $193.7 million for the Certificate III Guarantee Tuition Fee Subsidy which helps eligible Queenslanders obtain their first post-school Certificate III qualification to gain a job or to improve their employment status.
- $75 million for the Higher Level Skills Tuition Fee Subsidy which subsidises the cost of tuition fees paid by eligible students and employers undertaking a priority Certificate IV, diploma or advanced diploma or industry endorsed skillset.