Federal Budget Brief F2011
» Budget analysis by topic
» Interactive Budget Data
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| Metric |
F2010 (actual) |
F2011 (est.) |
F2012 (forecast) |
| Economic Growth |
2.0 percent |
3.25 percent |
4.0 percent |
| Inflation |
3.25 percent |
2.5 percent |
2.5 percent |
| Unemployment |
5.25 percent |
5.0 percent |
4.75 percent |
| Surplus / deficit |
-$57.1 billion |
-$40.8 billion |
-$13.0 billion |
| Dwelling investment |
3 percent growth |
7.5 percent growth |
4 percent growth |
| Investment in non-dwelling construction |
-7 percent growth |
8 percent growth |
14.5 percent growth |
Executive Summary
The F2011 Federal Budget is relatively frugal compared to previous years.
Key features include infrastructure funding, tax cuts, and a Renewable Energy Fund, with some new expenditure on planning and regulatory reform and the development of a population policy.
Here is a summary of the budget highlights.
1.0 Nation Building and Growth
+ A $5.6b infrastructure fund to invest in nation building spending over the coming decade, including a $700m initial contribution to be paid in F2013 and $735m in F2014;
+ More than $1b for the Australian Rail Track Corporation to enhance freight rail services;
+ $355m to upgrade and build GP Super Clinics;
+ Funding for a review of capital city strategic planning systems and a national population strategy; and
+ Private infrastructure investors will benefit from discounts on bond interest income.
2.0 Housing Affordability/Retirement Infrastructure
+ Common sense changes to the First Home Saver Accounts; and
+ $145m over four years in zero interest loans to improve retirement accommodation opportunities.
3.0 Capital Markets and Managed Investment Trusts
+ Corporate tax rates reduced to 28% by 2015, with an early start for small business;
+ The Government has commited to raise the superannuation guarantee charge to 12%, which will increase the savings pool available to property funds;
+ A bold new tax regime for Managed Investment Trusts – for more information, see www.propertyoz.com.au/MIT;
+ ASIC-approved, simpler and more efficient bond-raising documentation and prospectuses;
+ As part of the Government’s strategy to increase banking competition, it has committed to reducing interest withholding tax for financial institutions;
+ Distribution withholding tax will be reduced to 7.5% from 1 July 2010 – this benefit will now encompass wholesale and state-operated funds;
+ A savings boost: 50% discount on interest earned on deposits, bonds, debentures and annuity products, with various strings attached;
+ Improved capital allowance regime with instant asset write-off and simplified asset pools for small business;
+ The Board of Taxation has been charged with removing barriers to Islamic finance;
+ $24.1m to establish a Centre for International Finance and Regulation (CIFR) as a regional centre for excellence; and
+ Creation of a taskforce to progress an Asia Region Funds Passport.
4.0 Climate Change and Environment
+ $652.5m over four years for a Renewable Energy Future Fund, which will specifically encompass building energy efficiency and small-scale renewable energy projects, such as co/tri-gen; and
+ A $109m redesigned Green Loans Program for sustainability audits and energy efficiency improvements in homes.
5.0 Skills
+ A $661m Skills for Sustainable Growth Strategy to increase training places, including $200m for a critical skills investment fund focusing on the construction sector.
6.0 Technical/Other issues
+ Capital Gains Tax rollover measures which allow trusts to restructure, making it easier for takeovers and mergers using scrip for scrip.
+ GST amendments:
- - clarify the structure of the margin scheme rules and put in place common sense reforms that allow proper valuation of subdivisions; and
- - tighten rules to make it harder to claim reduced input tax credits on trustee fees which could increase GST costs – we are looking very closely at this proposed measure.
For a detailed critique of the Henry Tax Review go to www.propertyoz.com.au/Henryreview
For a detailed critique of the Managed Investment Trusts initiative go to www.propertyoz.com.au/MIT
» Growth and Nation Building
» Climate Change and Environment
» Governing Smarter and Cutting Red Tape
» Housing and Community Dividends
» Skills and Innovation
The Property Council has compiled economic performance data from past Budget papers.
Use the motion charts below to track the performance of the Australian economy, including forecasts included in the 2012 Budget.
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Instructions on how to use motion charts:
- + Clicking the play button starts a motion chart
- + The menu on the right allows you to change the size and colour of the points
- + Clicking on any of the tabs at the top of the chart allows you to change between a motion, bar or line graph
- + Ticking the trail box creates a trend line for the points on a motion chart
- + Selecting arrows on the X and Y axis allows you to interchange between the time and range on both the horizontal and vertical lines of the chart
- + Line graphs are the clearest. Click on the right hand tab to activate them
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Economic Growth vs Inflation and Unemployment
Budget Surplus / Deficit
Residential vs Non-residential Investment
| Peter Verwer |
Chief Executive |
ph. 0407 463 842 |
| Milton Cockburn |
Executive Director
Shopping Centre Council of Australia |
ph. 0419 750 299 |
| Roberto Fitzgerald |
Executive Director
International & Capital Markets Division |
ph. 0411 549 248
|
| Caryn Kakas |
Executive Director
Residential Development Council |
ph. 0404 257 540 |
| Andrew Mihno |
Deputy Executive Director
International & Capital Markets Division |
ph. 0406 454 549
|
| Angus Nardi |
Deputy Director |
ph. 0408 079 184 |
| Paul Waterhouse |
Executive Director
National Policy |
ph. 0411 875 366 |