Despite Prime Minister Kevin Rudd and Wayne Swan talking up the prospect of a horror budget, there were actually a wide variety of spending measures across the economy.
Here is SmartCompany’s sector-by-sector guide to the major budget initiatives.
The struggling tourism sector was dealt another blow last night with the Rudd Government cutting tourism spending by $26 million a year, from $195 million to $169 million. The bulk of the cuts come in the form of a reduction of Tourism Australia’s budget, which falls $13 million.
The biggest item in the budget affecting this sector will be the extension of the Do Not Call register to cover businesses, fax numbers and emergency service numbers. The initiative will cost $4.5 million, most of which will be clawed back by charging telemarketers and fax marketers to use the registry.
There wasn’t much in the budget for the farm sector, although the National Farmers’ Federation welcomed $300 million for an on-farm water efficiency program, and $79 million for the Bureau of Meteorology to enhance its network and provide seven-day forecasts to regional towns.
But the NFF was not happy that research and development in the area of agriculture will be cut.
Wayne Swan’s $22 billion infrastructure package should ensure the good times continue to roll for the engineering sector, which has been feeling the pinch from a big fall in mining work.
Peak lobby group Engineers Australia welcome this spending and the Government’s $4.5 billion Clean Energy Initiative, but chief executive Peter Taylor is disappointed not to see more initiatives to boost engineering skills.
“The requirements for engineering expertise are only set to increase as the key infrastructure and nation building announcements in the Federal budget get underway,” he says.
There was very little in the way of direct measures to affect this sector, although changes to superannuation rules and the tax treatment of hobby farms and employee share schemes will no doubt spark plenty of activity within the sector. The financial planning sector will particularly need to focus on strategies to deal with the decision to lift the pension age from 65 to 67 by 2023.
Public hospitals, cancer treatment and medical research received a $3.2 billion boost in the budget as part of a big push to invest in health infrastructure. But the pathology sector was hit by a decision to pay pathology providers (such as Primary Health Care) on the basis of the number of specimens the collect, rather than the number of tests they perform.
This measure will create savings of $763 million over four years. The private health insurance sector is also furious with sharp cuts in the private health insurance rebate for anyone earning over $75,001.
The IT sector really got its big present before the budget in the form of the national broadband network. But there was another little gift, with Senator Stephen Conroy guaranteeing the funding of research and the commercialisation the body National ICT Australia until 2014-25.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
