- Economic growth of 3.5% is forecast in 2021-22
- Record infrastructure and health investment
- The Budget forecasts a deficit of A$1.4 billion, with net debt to grow to A$26.2 billion in 2021-22
The South Australian Budget focuses on creating thousands of local jobs over the next four years to drive the State’s recovery through targeted stimulus, record infrastructure investment, lower costs for businesses and increased industry growth support.
A record infrastructure pipeline of A$17.9 billion over the next 4 years is the centrepiece of the job creation strategy, with new and upgraded roads, rail, schools and hospitals delivering employment opportunities.
A record A$7.4 billion will also be spent on health in 2021-22, focused on increasing emergency department capacity, boosting resources for important health services and improving capacity in public hospitals.
The Budget, delivered on 22 June by Treasurer Rob Lucas MLC, forecasts economic growth in 2021-22 to be 3.5%, compared with the Commonwealth estimate of national economic growth of 4.25%.
Although GST revenue has improved by A$2.5 billion over the four years to 2023-24 compared with 2020-21 Budget estimates, collections are still down by A$374 million in 2020-21 compared with expectations in the 2019-20 Mid-Year Budget Review.
State tax collections have been revised up by A$257 million in 2020-21 and by about A$40 million per annum over the period 2021-22 to 2023-24 since the 2020-21 Budget.
A net operating deficit of A$1.397 billion is forecast for 2021-22 as a result of the State’s comprehensive response to COVID-19.
The Budget is forecast to return to a modest surplus of A$48 million in 2022-23 and maintains projected surpluses over the forward estimates, including A$498 million in 2023-24 and A$379 million in 2024-25.
Net non-financial public sector debt is expected to grow from A$26.2 billion in 2021-22 to A$33.6 billion in 2024-25 to support borrowings for key infrastructure and stimulus in a low interest rate environment.
Over the next four years, A$17.9 billion will be invested in a record infrastructure renewal program for roads and public transport, health, education and schools.
Significant infrastructure projects include A$9.9 billion to complete the North-South Corridor by 2029-30, A$1.95 billion for the new Women’s and Children’s Hospital to be finalised by 2026-27 and A$662 million for construction of the Riverbank Arena, with estimated completion by 2027-28.
Renewal SA also receives A$20.8 million to further upgrade existing buildings at Lot Fourteen to enable the expansion of space, digital, hi-tech and cyber companies.
An unprecedented A$7.4 billion will be spent on health services in 2021-22. More than A$110 million is allocated to 140 new treatment spaces for emergency departments and Emergency Extended Care Units. Alternative services delivery options have been developed to address increasing demand for emergency services.
More appropriate accommodation options will tackle bed block in the State’s hospitals. Further resources are also provided for ambulance services such as an additional 74 FTE ambulance personnel.
Mental health system
A landmark A$163.5 million mental health system package over four years will strengthen the State’s mental health system by responding to the immediate need for additional support services and investing for the future.
The funding will provide a suite of critical new services, including additional ongoing community support services, construction of a new 16-bed crisis stabilisation centre in the northern suburbs and expansion of the Adelaide Adult Mental Health Care Centre to allow for 24-hour operation.
Land tax relief
The Budget provides an additional A$10.7 million in land tax relief in 2021-22 to help taxpayers affected by changes to land tax aggregation rules. This initiative increases relief to 70% of the relevant increase in 2021-22, taking the total value of estimated relief through the land tax transition fund across three years to A$48.7 million.
Land tax discount
A 50% land tax discount to support affordable housing will be introduced for eligible new build-to-rent projects where construction commences from 1 July 2021. The discount will reduce the land value for eligible projects for land tax purposes by 50% until the 2039-40 land tax year.
Jobs and Economic Growth Fund
The Jobs and Economic Growth Fund has A$200 million funding available over four years, in addition to the A$244 million already allocated, to accelerate jobs and economic growth. This includes A$123.6 for targeted investments in key sectors that grow jobs and the broader state economy.
JobTrainer Scheme extension
An additional A$34.5 million is allocated to extension of the JobTrainer scheme to match the Commonwealth Government’s investment. This brings total additional funding for skills and training to A$69 million.
Apprentice and trainee payroll tax exemption
The Budget extends the 12-month payroll tax exemption for wages paid to eligible trainees and apprentices who commence a relevant training contract. This exemption applies for 12 months from the contract commencement date up to 30 June 2022.
Small business capability program
Small businesses will receive support to develop digital and cyber security capabilities and business capabilities to enter the national trade market, boosting interstate exports, through funding of A$2.6 million over four years. A revitalised web presence will provide improved information and support to small businesses.
Aboriginal Art and Cultures Centre
Funding of A$200m over four years will aim to have the Aboriginal Art and Cultures Centre open in 2025. The centre will exhibit Aboriginal art and culture in a world-class setting that will make Adelaide a destination of choice for national and international cultural tourists.
Our budget infographic highlights the major announcements.
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