Topic: Budget 2021-22




Katie Woolf: But, what’s in it for the Northern Territory? Well, joining us on the line is the Federal Finance Minister, Simon Birmingham. Good morning to you.


Simon Birmingham: Good morning, Katie. Great to be with you.


Katie Woolf: Minister, thanks so much for your time. When we look at this, firstly, the figures are eye watering net debt seven hundred and twenty nine billion. Our deficit for 2021, one hundred and six point six billion. The treasurer unveiled tens of billion dollars in new spending. Minister, it’s the kind of debt that the coalition would call reckless if Labor were doing the spending. Why is this level of spending required at this point in time?


Simon Birmingham: Katie, we’re dealing with very different times right now. The global economic crisis induced by Covid-19 has been the biggest shock to the world economy since World War Two. And obviously that’s necessitated huge investment in spending and keeping Australians safe and secure. And this budget is a next stage in our plan to continue the economic recovery while continuing to keep Australians safe and secure from Covid-19. Now, what we’ve been able to do is frame a budget where, in fact, those net debt project’s prediction that you spoke about will actually be lower in each of the next ten years compared with what was forecast in last year’s budget, so because of the strength of our economic recovery, because we’re getting more Australians back into work, we’re able to invest in essential services like aged care, like disability support or mental health, but do so in a way where those debt projections lower both in absolute terms and of the share of the size of our economy compared with what was forecast just back in last year’s budget.


Katie Woolf: Now, Minister, we know around 100000 Territorians are expected to benefit from tax cuts. Who’s going to be eligible and who exactly will this help?


Simon Birmingham: So these tax cuts are going to provide a real boost to Territorians providing up to 1080 dollars for low and middle income families in the Territory for individuals up to two thousand one hundred sixty dollars for dual income families in the low and middle income categories. They serve really two purposes. One is in part, they’re a bridge through to some of the permanent tax reforms that we are implementing in a staged way that will see most Australians pay no more than 30 cents in the dollar income tax rate. But they’re also an important part of our Covid recovery plan by providing additional support over the next year. And they provide a support for individuals and families that sits alongside some of the investment incentives that we’ve put in place for Australian businesses that are all about getting business to bring forward growth plans they might have had, investment plans they might have had so that we get more activity now and greater productivity and capacity in our businesses for jobs growth over the years to come.


Katie Woolf: If you are you know, let’s say there’s Territorians listening right now wondering if they are eligible for some of these tax cuts and businesses, wondering how they might be able to access some of what is available, where are they going to be able to get that information from?


Simon Birmingham: The is the source of all sorts of information for people with links off to some of the different programmes or departmental sites where they can find more info. But I mean, essentially, every single Australian business is basically entitled to full expensing. Only a handful of major global’s and others with revenue in excess of five billion dollars find themselves excluded. Otherwise, what we’re doing is really backing Australian business here to invest, to grow and we’ve got employment already back to levels that were pre pandemic. And in this budget, the projection is that we will create a further 250000 jobs for Australians that will mostly be delivered by the private sector. But we’re also supporting subsidies to drive 100000 additional apprentice opportunities around Australia and, of course, fuelling additional investment in infrastructure projects like the NT National Network Highway Upgrades and access into the Beetaloo Basin.


Katie Woolf: I was just going to ask, can you run us through what’s in it for the Northern Territory? We did catch up with the Deputy Prime Minister a bit earlier in the week and have also spoken to the Energy Minister about what is in it for the Territory.


Simon Birmingham: So I’m sure the DPM took you through those infrastructure projects, an additional four hundred and one million dollars towards key Northern Territory infrastructure projects. Now, I’m sure Angus Taylor took you through the potential we’re seeing through our commitments to full storage, to our energy security, into making sure that Australia has sovereign capability and that’s building on the big manufacturing strategy that we released in last year’s budget and we’re extending that in this year’s budget with new sovereign capability, policies and settings across Government. The Territory is also going to see an uplift in indirect support flowing through and GST payments that we collect on behalf of the states and territories are estimated to be three point three billion dollars in 2021/22. That’s an increase of 500 million dollars over what was expected at the time of last year’s budget. So that will provide greater capability to Michael Gunner and his team in the Northern Territory to be able to deliver in the Territory and in fact, overall, we’re seeing other Commonwealth payments to the Territory increasing as well by a further two hundred million dollars or 11 per cent increase, compared with 2021 budget estimates, so we’re really supporting the Territory and the Territory Government to be able to deliver as well.


Katie Woolf: Can you just very clearly, again, lay that out for us, the GST? Because I know over the last few years here in the Territory, there’s been quite a bit of discussion about the GST in previous years. The Northern Territory government have said that it’s had a massive impact on our budget when the GST share has gone down. But it does, like you’ve said, seem as though we’ve had quite the windfall when it comes to the GST this time round.


Simon Birmingham: I mean, GST does move. Government revenues move around depending on consumer behaviour and business trends and we face that as the federal government in terms of how much income tax and company tax and so on is paid and the states face it in relation to the GST that we collect for them and pass through to them. But because, again, we’ve got a stronger economy, more Australians are in jobs than ever before. And let’s contrast that against the rest of the world, in Europe, they’re facing a double dip recession. So you know the Covid problems in the rest of the world aren’t just the human tragedy we’re seeing in India, they’re also continued economic crises in other parts of the world. But here we’ve got that strong economy and kept people safe. We’ve got jobs coming back, we’re forecasting another 250000 jobs being created, and all of that is providing great consumer confidence, which is leading to spending patterns that are driving that lift in GST for the states and territories. And so that’s a 500 million dollar additional bonus to the Northern Territory government in terms of the GST revenues they’ll receive.


Katie Woolf: Now, that is good news, we know that Labor’s member for Solomon, Luke Gosling, he’s slammed the budget, saying there is nothing for the Territory. He’s also questioned where 216 million dollars in funding for Kakadu has gone and slammed no funding for the veteran wellbeing centre. What’s your response to that?


Simon Birmingham: Well, this is a budget for all Australians. And first and foremost is the National Government. It is about keeping Australians safe and keeping the economy growing and so the investments, the tax investments, we’ve spoken of, other things such as what we’re creating around what’s called a patent box, which is about in a new tax tool to help to keep innovation in Australia and have them commercialised and manufactured and developed in Australia. They’re important about getting growth in those manufacturing sectors. But this is also a budget firmly, it is delivering for the Territory throughout Covid. And we’ve provided additional infrastructure funding for projects to be delivered across Kakadu and Uluru really to be able to step up the work and investment in those communities, particularly while visitors weren’t allowed in but to be able to improve infrastructure facilities. And of course, there are big projects underway in relation to the restoration of Jabiru and the potential there, which we are investing in. But that’s all subject to working successfully with the local community, Territory Government, Federal Government and of course, traditional owners in terms of delivery of those projects and that’s what we’re getting on with.


Katie Woolf: Minister, we are running out of time, but tourism is indeed a sector which has been hard hit when it comes to Covid. The estimates from last night are based on the assumption that those borders are not going to open until the middle of next year. How is the budget going to really assist those Territory tourism operators that are impacted by the lack of international travel?


Simon Birmingham: So we’ve stepped up a one point two billion dollars in terms of support for the tourism industry through a programme that is that is driving domestic flight subsidies across the country. More than 650000 such flights have been booked already around Australia, they are going to provide a continuing boost in terms of visitation for some time to come. I think we’re seeing Australians who traditionally spend 65 billion dollars leaving the country, actually now booking and travelling across Australia and we want to make sure we keep that going, which is why we put those sorts of supports for the aviation industry and for tourism and travel bookings to occur into effect and from what I’m hearing from tourism operators around the country, some of them are now seeing even better bookings than they would customarily have seen through these times the years before.


Katie Woolf: Well, Minister, is this the Coalition’s last, well budget before a federal election?


Simon Birmingham: The election is due in the first half of next year. The budget is customarily handed down in May, so it will be up to the PM as to when he calls that election in the first half of next year but that’s is firmly when I expect it to be.


Katie Woole: Well, always good to catch up with you. In fact, I think this might be the first time we’ve had you on the show, Federal Finance Minister Simon Birmingham. So we really appreciate your time this morning. Thanks for having a chat with us.


Simon Birmingham: Happy to do so any time, Katie, thanks so much.


Katie Woolf: Thank you.