Queensland's 2018-19 Budget includes a range of items which support infrastructure, skills and services to boost employment and build cities and regions across the state. This Budget can be considered to be positive for the property industry. Some measures introduced may have a slightly negative impact for some participants in the property market namely increases in two tax measures; 1. An increase to the land tax rate on property holdings above $10 million by 0.5 percentage points; and 2. An increase in the additional foreign acquirer duty to 7%. However, in its fullest context, this Budget is aimed at providing infrastructure to cater to the States fast growing population of five million, drive transformative change in a range of industries, encourage private investment and enhance the states enviable living standard. All of these are important factors which help to sustain a robust property industry and maintain Queensland ‘s profile as a desirable place to work, conduct business, to live and play. The centrepiece of the 2018-19 Queensland Stage Government Budget is a commitment to upgrading infrastructure. The 2018-19 Budget invests $45.8 billion in infrastructure over the forward estimates including projects such as the Cairns Convention Centre, Cross River Rail, the M1 and Bruce Highway upgrades, Rookwood Weir and Townsville Stadium.
The spend represents a significant upgrade and notably it is the largest capital works program since 2012-13.
The magnitude of the spend will provide a meaningful stimulus for the property industry, with measures from across Government that should help to drive the economy, deliver improved services and support the community and create thousands of jobs.
Significant measures announced include:
- M1 Pacific Motorway: additional funding of $897.5 million is provided for planning and upgrades to the M1 Pacific Motorway;
- Future Proofing the Bruce: additional funding $10 million over two years to develop a 15-year vision and initial Action Plan to identify and prioritise projects to be delivered as part of upgrades to the Bruce Highway and $253.5 million over three years to delivery priority Bruce Highway upgrade projects;
- Building Future Schools Fund: additional funding of $308 million over six years from 2018-19, bringing total funding to $808 million across seven years to deliver world class learning environments for students;
- Rookwood Weir: increased funding of $176 million over four years to support the construction of the Rookwood Weir on the Fitzroy River, which is being matched by the Australian Government capital contribution of $176 million and providing drought contingency supplies for Rockhampton, Gladstone and Yeppoon;
- New Performing Arts Venue at the Queensland Performing Arts Centre;
- Growth Area and Regional Infrastructure Investment Fund: additional funding of $40 million over two years from 2018-19, held centrally, to invest in infrastructure that improves prosperity and liveability for Queenslanders living in outer urban and regional Queensland; and
- Beerburrum to Nambour Rail: the Government is providing funding of $160.8 million over four years towards the Beerburrum to Nambour rail duplication project.
The Budget also provides expenditures for Employment and Training Programs. These will enhance access to training and jobs for Queenslanders and include:
- Skilling Queenslanders for Work: increased funding of $180 million over three years from 2018-19 to boost the initiative to fund more apprenticeships and increase workforce participation through a suite of targeted skills and training programs.
- Back to Work: increased funding of $155 million over four years from 2017-18 to extend the regional program to 30 June 2020 to continue to provide employer support payments to employers hiring eligible unemployed jobseekers in regional Queensland.
- Expansion of the Jobs and Regional Growth Fund: increased funding of $20 million for the Jobs and Regional Growth Fund to help facilitate private sector projects which create employment and economic growth opportunities in regional Queensland by focusing on regions with higher than average unemployment.
- Driving Queensland Agriculture and Rural Jobs Growth: additional funding of $19.2 million over three years to support Queensland agriculture and rural jobs.
The budget also provides Industry Attraction and Support programs.
Tourism is a $25 billion industry for Queensland and the 2018-19 Budget includes a range of measures to help ensure the State remains a destination of choice for interstate and international visitors.
This includes continued funding for Tourism and Events Queensland to attract more visitors through marketing, events and experience development as well as $94.6 million over five years to progress programs under the Growing Tourism, Growing Tourism Jobs initiative including:
- Attracting Tourism Fund: additional funding of $48.6 million to provide incentives to attract new and international airline routes and cruise ships to Queensland
- Regional Tourism Infrastructure and Experience Development Program: additional funding of $46 million to assist communities to grow tourism by developing new and improved tourism experiences, such as the Wangetti Trail in the State’s Far North, and develop tourism industry capability, including facilitation of outback tourism projects.
Other initiatives include $26.2 million over four years to attract future major events as part of the Advancing Tourism program, additional funding of $25 million over three years to establish a Reef Resort Rejuvenation Fund to deliver infrastructure for the Great Barrier Reef islands with projects focused on cleaning, greening and growing and $2.2 million to expand the Australian Workers Heritage Centre at Barcaldine.
A range of programs aimed at protecting the Great Barrier Reef were also announced. To support the reef and manage the impacts of climate change, the Government is investing $330 million over five years. Several initiatives are outlined in the 2018-19 Budget, including:
- Great Barrier Reef - Joint Field Management Program.
- Great Barrier Reef - Water Quality.
- Climate Change Implementing Queensland's Response.
- Enhanced Statewide Landcover and Trees Study.
The Budget also acknowledges the importance of being competitive in a global market. Through its flagship Advance Queensland initiative totaling $650 million, the Queensland Government maintains a focus on fostering innovation and entrepreneurship to enable Queensland businesses to adapt rapidly to the ever-changing global business environment.
Measures from across Government that will support Queenslanders to participate and succeed in the modern economy include:
- Advance Queensland Foundations for the Future: increased funding of $73 million over four years for the Advance Queensland initiative including $30 million for Ignite Ideas which is helping Queensland startups and small and medium enterprises to succeed
- Advance Queensland Increase: increased funding of $50 million over five years to continue funding programs including expansion of 'The Precinct', the State's flagship hub for start-ups, support for the Clem Jones Centre for Ageing and Dementia Research, and a range of programs to drive and scale innovation in Queensland
- Advance Queensland Industry Attraction Fund: $40 million over two years has been provided in the 2018-19 Budget to extend the Advance Queensland Industry Attraction Fund, bringing total funding to $105 million, which will help to attract interstate and overseas businesses considering moving to Queensland, or Queensland-based businesses interested in expanding.
A range of other measures have also been announced to support Queensland businesses. Buy Queensland, introduced in September 2017, prioritises local businesses, jobs and better social outcomes. Since Buy Queensland came into effect, 84% of Queensland Government contracts awarded through QTenders have gone to Queensland businesses.
Measures in the 2018-19 Budget that support Queensland businesses include:
- Business Development Fund.
- EcoBiz Program for Small to Medium Enterprises.
- Security of Payment for Subcontractors in the Building and Construction Industry.
In summary the programs announced as part of the Budget should drive private sector opportunities through expenditures in construction phase of large scale projects and ongoing employment generation associated with these projects across portfolios of health, education and economic development, industry and innovation.
As consequence of the scale of the infrastructure investment announced in the Budget, and its breadth across cities and regional Queensland it is reasonable to assume that interstate migration will get a boost which in turn will support investment in jobs and housing which surely is positive for the Queensland property industry.
To understand more about how the QLD Budget 2018-2019 will impact you or to investigate specific opportunities within Queensland, contact Mark Courtney, General Manager - Queensland today.
About the Author:
Mark Courtney is the leader of our Brisbane office as MacroPlan’s General Manager – Queensland. Mark’s is an accomplished property professional whose experience uniquely positions him to provide leadership in property research and consultancy. He has considerable experience in the analysis and development of Australia’s industrial property sector, as well as extensive market trend analysis, feasibility assessment and land demand and supply modelling expertise.