Staying the course - good for now - but Queensland must count on change: Deloitte
- $885m to payroll tax initiatives over four years to boost jobs: good news in the regions
- $49.5bn infrastructure spend on big ticket items: transport, health and education
- $19m to create a new hydrogen industry for the future: new industry means new jobs
- $100m to accelerate the expansion of the North West Minerals Province: opening up opportunity
- Surpluses over the forward estimates despite a $3.8bn hit to the bottom line.
11 June 2019: Queensland’s 2019-20 budget brought down today by the Deputy Premier and Treasurer, Hon Jackie Trad, was all about ‘staying the course’. That course means jobs.
This has seen the usual spending targetting regional economic growth through the captial works program and investment in fronline services. In fact, just over $1 in every $2 of expenditure is going to health and education.
“A challenging global economy and a slowing Australian economy has left little economic room to move for the Queensland Government. The budget took a $3.8 billion hit to its bottom line from what could have been a toxic fiscal mix of falling GST, natural disasters and lower stamp duty.
“But the mix wasn’t lethal and the fact that the Government has delivered surpluses across the forward estimates is no mean feat,” said Deloitte Access Economics Queensland leader Dr Pradeep Philip.
“Despite ‘staying the course’ there were a few innovative surprises today.
“The $885 million payroll tax reform package aimed at incentivising small and medium businesses to expand and create jobs is a significant boost. It’s an unexpected pro-business move and will be well received even though larger businesses will end up paying a bit more.
“Also the regional payroll tax discount - a 1% discount on payroll tax for businesses where 85% of their staff are outside South East Queensland - is a clever move.
“While ‘staying the course’ is a safe strategy for managing an economy in the short term; the reality is that change is something Queensland can count on. Queensland’s changing production mix, in part technological advancements and in part the benefits of agglomeration economies in our cities, has been a key contributor and will inevitably continue to change the economy.
“Industries such as agriculture, mining, manufacturing and retail trade, have seen significant increases in automation in production and distribution – leading to change where the pace and scale can be hard to keep up with. Also there is no question that Government economic strategy must meet the challenge of climate change head on - especially for an economy such as Queensland’s.
“The private sector is already adapting to the disruptions of technological change and climate change; Government policy has to do more to accelerate this adoption by business, our communities and Queenslanders.
“Like all budgets there is a sting in the tail. With increases in some taxes such as payroll tax for large business, land tax for foreigners, companies and trusts, and royalties on petroleum. Government borrowings have also increased to pay for increased infrastructure, but it is good to see servicing costs remain within manageable limits.”