Budget reply speech 2020-21
Tuesday 17 November 2020
Budget reply speech
Ms ARMITAGE (Launceston) - Madam Deputy President, overall this is a macro budget which focuses heavily on broader economic inputs like emphasising infrastructure investment, generating investor and consumer confidence and providing incentives for business to stay open.
In the extended period since the Tasmanian Government handed down its last budget a great many factors have drastically changed the way we live, work and look after ourselves. The human and health element of the coronavirus pandemic has clearly been the driving factor around every health and economic policy the state and federal governments have enacted. This is the way it should be and few would argue otherwise.
In times such as these it is easier to look at our circumstances in a vacuum and, not unreasonably, to panic. However, it is clear that the better we get a handle on this virus, the better and more quickly our economy can recover and return to normal. We should have a great deal of confidence in seeing, for example, how well and quickly the COVID-19 outbreaks have been handled and suppressed. With the recent news about the outbreak in South Australia, I believe we can draw further confidence from the swift action taken to implement quarantine measures and contact tracing in the last few days. So too, with how impressively the outbreak in Victoria was contained and supressed within a matter of months.
It is undeniable that the Tasmanian Government's quick handling of the virus here has led to better outcomes than was originally anticipated. For this we have to thank not just our Health department, director, minister, secretary or the Premier, but also the Tasmanian people who understood how significant the threat was and responded accordingly. It was only together we were going to get through this and if the last 10 months or so are an indicator of things to come, we have much to be optimistic about.
To the Budget - I understand we are to see a moderate return to surplus in the financial year 2022-23, although I am cautious of forward Estimates by nature. That being said, what we have with this Budget are steps to move towards something resembling getting back to normal. To this end I am glad to see the incorporation of the recommendations from the Premier's Economic and Social Recovery Advisory Council into the Budget overall, but I will speak a little more about this later.
The Government has been clear that this Budget is focused on supporting employment, returning confidence in our economy, supporting the community and rebuilding a stronger Tasmania. There is a lot involved in these undertakings and the Government should be ambitious in its approach to repairing the state's affairs. It is no surprise then to see the Government prioritise simplifying and fast-tracking planning processes in order to keep our construction industry ticking along. The passing of the Building and Construction (Regulatory Reform Amendments) Bill back in June, for example, was a step in the right direction. The Tasmanian building and construction industry employs more than 20 000 people and the multiplier effect is even greater when you take into account its impact on the associated employers up and down the service and supply chain, which all depend on the state having a robust construction industry.
It is entirely appropriate that the Government also explore the Keynesian option of creating supply by enacting building and construction works to stimulate the economy, incentivise private investment, create jobs and promote ongoing and sustainable capital works projects. Legislative frameworks must contain the right settings to most effectively channel our precious resources and eliminate unnecessary red tape. The Tasmanian Chamber of Commerce and Industry - TCCI - Road to Recovery paper emphasised the significant impact that workforce changes have had on the economy and the resultant need for new skills and knowledge for a robust workforce.
It goes without saying that we need to be listening to our businesses when they tell us what they need in a workforce, and it is incumbent upon the Government to tool up our education and training sector to ensure people are workforce-ready. Now as we look to regenerating our economy, it is more important than ever that we have the right people with the right skills in the right place at the right time, and the most crucial period will be the next 12 to 18 months.
The chief executive of the TCCI, Michael Bailey, has also indicated that there may have been missed opportunities for restructure and reform, that long-term sustained growth should be the goal, supported by a range of further measures to continue supporting the private sector in the years to come. Reducing input costs like power costs and existing restrictions such as payroll tax need to be on the discussion agenda in the year to come. For now, the extension of the payroll tax rebate to apply to all apprentices, trainees and youth across all industry areas until 30 June 2022 at a cost of approximately $22 million is certainly an incentive to get younger people who are particularly vulnerable to economic downturns into employment.
It is more important than ever to help our young people and learners to transition smoothly into the workforce. To this end, the provision of $10.5 million for no- or low-cost vocational education and training courses as part of a wider initiative between the Australian Government and the Tasmanian Government to the tune of $21 million under the JobTrainer initiative is certainly a wise use of public funds.
So, too, is the $2 million for more TasTAFE teachers in priority industries, which I understand will focus on high demand areas such as aged care, electrotechnology, plumbing and nursing. It will be imperative this is enacted swiftly and properly in order to create a pipeline of learners to workers in the important months ahead.
So much rests on the correct implementation of these measures, including the veracity of the Budget's forward Estimates so proper engagement between the Government, the business sector and our VET institutions will be essential.
Measures such as these should not be taken in a vacuum, however, and it is incumbent upon the Government to maintain measures which make doing business easier. I understand the Government plans to continue the waiver of payroll tax on wages paid to employees under the JobKeeper program until its conclusion and providing land tax relief in 2021 for commercial property owners impacted by COVID-19.
I reiterate that the Government needs to consider how to best manage the need to maintain revenue streams, with longer term private sector support beyond this Budget and for the years ahead.
Of course, the big ticket item in this Budget is the focus on infrastructure with an investment of $3.9 billion to be spent on roads and bridges, hospitals and the health sector, human services and housing, law and order, schools and education, tourism, recreation and culture and ICT to support service delivery.
I reiterate these are significant undertakings. There is a lot of spending in this Budget and there is much here to be optimistic about and much to generate confidence in investment and government spending. However, given the risk to Tasmania's share of money coming into the state from GST receipts to Australian Government funding and a decline in state revenue streams, it is also paramount this Budget takes responsible oversight for all the money being borrowed and spent. That is the entire point of this Budget and what underpins our plans for recovery and growth.
As of August, the Tasmanian Economic and Fiscal Update Report estimated there to be a decrease of $146 million, with the major reductions comprising payroll tax $76.6 million, conveyance duty $29.8 million and land tax $18.9 million. GST receipts from the Commonwealth Government amount to an incredible 62 per cent of the state's entire budgetary revenue. We must be careful and responsible.
The Budget Papers themselves note the risks inherent in major projects like infrastructure with issues like the availability of appropriate industries to actually undertake the work, and I am hoping Tasmanian workers are given the first opportunity, changes to the timing of project expenditure and the consequences of unforeseen delays.
The Moody's state of Tasmania report released last week says its slippage over the forward Estimates is highly likely and the scale of infrastructure spending will be difficult to deliver within the projected time frames.
Risks such as these are not limited to infrastructure, but exist below the surface across the entire Budget.
I say this not to cast a shadow over the Budget because I do not see any reason to do that just yet, even with the assessment from Moody's; however, I wish to emphasise that, like the occurrence of a global pandemic, even good planning and appropriate responses can undermine the best of efforts.
This is why proper oversight should be taking place. Here I am not talking about installing more red tape, but merely ensuring the great amounts of public expenditure, the likes of which we see in this Budget, are accurately and appropriately transparent, that tender processes are thorough and efficient and that time frames for project delivery are adhered to.
By way of example, I have for some time been trying to find out why a Queensland firm was engaged by the Tasmanian Health Service to undertake a survey for the Launceston General Hospital emergency patients rather than a Tasmanian firm, many of which I am sure are very well equipped to take on such a project.
To date I have not received a satisfactory answer and, as I have mentioned on several occasions, was insulted when the response basically stated if the Queensland firm did not do the work, it would cost substantially more for the Emergency Department staff to do the work themselves.
As reiterated on several occasions, my question was on whether Tasmanian firms had been given the opportunity. Certainly I did not have an expectation of the Department of Emergency Medicine doing the work itself, taking it away from its core business of health care.
It is risks such as these I believe have the potential to undermine the good faith in which this Budget has been handed down. Occurrences such as these fly in the face of PESRAC's recommendation to procure goods and services locally on an if-not, why-not basis. By way of further example, I also raise the issue of reports of only one-third of travel vouchers having been redeemed, with only a month left until they are no longer valid. Of course, there are many things to learn out of managing this crisis, but we should look at examples like these to make sure the vast amounts of public resources being spent actually end up where they need to go.
There is the potential of having great initiatives, backed up by very impressive amounts of public funding, becoming an illusion and our industries and small businesses suffering as a result. Now is the time to rethink and retool the state's approach to the economic prosperity. Now is the opportunity to think about what we want the state's balance sheet to look like in 20 years and to act towards making it a reality.
One of the most important drivers for the state's north has related to our population growth being a key driver of retail spending and housing demand. The October 2020 CommSec's State of the States report shows Tasmania is leading on a number of indicators, including retail spending and relative population growth. However, it has also been forecast by the Deloitte Access Economics Business Outlook report that Australia's population will be almost 600 000 people fewer by 2022 than it would have been without the pandemic.
The Australian Treasury also perceives a decline, with these reports representing the lowest rate of growth in over 100 years, the expected first occurrence of negative net migration since 1946. For Tasmania, the Budget Papers themselves show population forecasts are quite a bit less than expected which, for a state as small as Tasmania, is an issue that has greater magnitude than it might for more populous states. Forecasts show population growth is only expected to rise by 0.5 per cent in 2020‑21 and 0.6 per cent in 2021‑22, down from the 1.2 per cent in 2018‑19 and the 1 per cent estimated from this year.
Given that Tasmania's economic performance in 2018‑19 was supported by above-trend growth in household consumption and dwelling investment, as well as robust business investment driven by the tourism sector, this emphasises Tasmania's unique vulnerability to a decline in population and visitors and the effect this has across the economy. Refocusing our efforts on these sectors will therefore be critical as we stage our approach out of the pandemic and return back to normal.
For Launceston specifically, I am pleased to see the Budget includes $5.15 million to continue the upgrade of Launceston Airport as part of an overall $10.3 million project. Being the gateway to the north, it is integral we present an accurately picturesque image of our part of the state to visitors and to consequently support our tourism industry and population growth.
I commend the vision of Hans van Pelt, the new chief executive of the airport, upon whom it will be incumbent to properly manage the airport and its assets in this crucial period into the future. I also wish to acknowledge the hard work and solid foundation laid by erstwhile general manager Paul Hodgen as well. It is clear that, given the vast differences in how containing the virus has spread across the world, it will be very unlikely we can expect to open our doors to international travellers any time soon.
However, there is much to be hopeful about with regard to interstate travellers, given the opening of our borders to our friends on the mainland. There is obviously much more to be done, but if we maintain this momentum in suppressing the virus and couple that with measures to responsibly entice people to visit, we will be off to an excellent start.
Keeping up consumer confidence will also be vital in the months and years ahead and the CommSec October State of the States report indicates Tasmania leads on the retail spending indicator, which is fantastic news. I note, however, there is little in the Budget by way of ongoing support for Tasmania's retail sector to keep this up.
In Launceston, vacancy rates in the CBD is a much-discussed and, frankly, concerning topic with some of our larger retailers leaving the Brisbane Street Mall and no-one replacing them. The redeveloped Brisbane Street Mall is barely two years old and fewer and fewer people are visiting. Despite this, the Launceston Chamber of Commerce has reported there have been 15 new store openings in the city in the past couple of months, which is an extremely encouraging sign. I would like to see how the Government continues to plan supporting this, as people and companies with the wherewithal to open a shop in this climate need to be supported as much as possible, given the positive contribution they make to our economy.
In recent years, Launceston has seen an unprecedented level of public and private investment to make the city more attractive and amenable. The construction of the Silo Hotel, the redevelopment of the C H Smith site and the Quadrant Mall, Civic Square and the Brisbane Street Mall refurbishments have all contributed to a quantifiable shift in the city's disposition. We cannot, however, simply construct and refresh these areas and expect them to flourish alone. Work must be done to maintain and accelerate the move towards making Launceston an even greater regional city.
As Launceston continues to move towards becoming the great educational regional city we are steering it on the way to, we will find that despite these opportunities arising, the work being done to make the inner city more liveable and attractive will be for nothing.
If the traffic issues, particularly as they relate to heavy, high-emission vehicles, remain a non-priority for the Government, urban sprawl will commensurately worsen, and the opportunities once present for city living and development will dissipate.
If we are to attract a younger demographic, we must leverage the world-class infrastructure that already exists here, not take it for granted, and not allow it to worsen. It makes very little sense for such significant expenditure to be channelled into Launceston's liveability and amenity, without also ensuring that issues like traffic flow and road maintenance detract from it. I know there are lots of plans to investigate options, conduct feasibility studies and get community input, which is an excellent start. It is time, however, to make decisions and start construction on some of these projects.
The much-contemplated eastern bypass concept to take heavy traffic out of our city is something we have discussed for decades at this point, without any real action being taken. I feel this is a missed opportunity. I am, however, glad to see some movement on the Tamar Bridge feasibility study, with millions provided in the Budget for the years to come for the Launceston and Tamar Valley traffic vision. The sooner we can get some movement towards construction, the sooner it can start being used. Feedback I have received indicates a great deal of support for this project. The Premier himself indicated that this will be one of his top priorities in the north of the state when he took up the role back in January, so it is good to see him stick to his word on this issue.
Now is the time to actually get these things done. Leader, am I correct in assuming that the eastern bypass is part of this traffic vision? Perhaps you could tell me where that is at.
I am cautiously optimistic that the $41.1 million allocation to address and upgrade Launceston's urban water infrastructure will go some way to restoring the kanamaluka/Tamar Estuary back to something resembling its original state. This is not to say it should be immaculately pristine, but I am certainly hopeful that works on urban water infrastructure will prevent some of the stormwater overflow and raw sewage entering our waterways.
From budget Estimates in previous years, I have been advised that properly cleaning and maintaining the Tamar River would cost somewhere in the order of hundreds of millions of dollars, so while this funding is most certainly welcome, it does not seem as if it will have the ultimate outcome many people living in the Tamar Valley desire.
This issue, too, was flagged by the Premier as being one of his top priorities when he took up the position, so this follow-through is welcome, and I hope to see sustained efforts towards remediating the river. Of course, much of the work with regard to cleaning our river comes down to TasWater. It is hoped that Tasmanian employers - not just mainland companies with offices here - and Tasmanian workers are given much of that work.
We cannot forget that our state, and even the abstract notion of the economy, is made up of people. It is in the economy's best interests if people are looked after. The suite of measures contained in this Budget towards looking after health and wellbeing, focusing on education and training, as well as culture and recreation, are most welcome.
I note that the Budget, with $2.8 million provided for sport and recreation grants, supports the ongoing viability and operations of sporting organisations. Funding of $917 000 will be available in 2020-2021, so I am sincerely hoping that there will be enough to keep our vital sport and recreation organisations afloat, given their importance to the health, wellbeing and sense of community amongst Tasmanians.
Another thing quite close to my own heart is the provision of $300 000 to Football Tasmania to leverage the FIFA 2023 Women's World Cup, and grow women's and girls' football in Tasmania. As one of the most widely played team sports in Tasmania, and with a strong uptake of Ticket to Play funding, which itself is receiving $4 million over the next four years, this is a wise investment. Football Tasmania made a very compelling argument to the Government in its submission for this Budget.
Moreover, the provision of $250 000 to the City of Launceston to progress planning for the redevelopment of UTAS Stadium, or York Park as it is affectionately known, to enable seating capacity to be increased, and for the stadium to be ready to play a part in the World Cup, is also welcome.
I would like to see the planning work expedited, however, considering the FIFA venue selection process will be taking place within a matter of months, and the opportunity could well be lost if we wait too long.
In these highly tumultuous and uncertain times, it is more important than ever that we look after our children. I am glad to see that education is receiving a boost, with the number of educational infrastructure projects being paired with the Government's focus on building and construction.
East Launceston Primary School is set to receive $725 000 to finalise a $4.5 million project for the provision of new kindergarten facilities, general learning areas and a multipurpose facility to cater for increased enrolments. I am pleased this project has been supported to its conclusion.
I am further glad to see a number of schools in and around the more newly developed areas around Launceston get funding for capital works. However, I am hoping that as the $18 million implementation of the Education Act reforms are being rolled out, we will see some funding for other government schools in my electorate whose facilities could also be boosted. It is fantastic to build new schools for the areas that need them, but we should not neglect existing schools, who also feel the strain of depreciating facilities, and who should not have to wait for election time to be promised funding.
I am sure the member for Windermere will bring up Queechy High School when he speaks -
Mr Dean - I certainly will do.
Ms ARMITAGE - It is not actually on my side of the electorate.
Mr Dean - No. It is nothing to do with you.
Ms ARMITAGE - That is fine. I knew you would bring it up, so I thought I would leave that for you.
In a similar vein, I would like to get a better understanding of how the grade 7 to 12 implementation plan would be managed into the future, and will have some questions about this during Estimates.
In Launceston at least, our two major colleges have vastly different subscription rates, and as further year 11 and 12 providers enter that arena, getting a good understanding how each of them will be resourced on a longer term basis, to ensure we get the best outcomes for our teachers and students, will be very important.
Taking care of our communities is another factor that gives Tasmanians a sense of health and wellbeing.
The administration of crime and criminal justice, in addition to rehabilitating criminals, has been a hot button issue over this year. Just recently, it was reported in the Mercury that due to underfunding, prosecuted criminals are walking free - due to the office of crown prosecutions being underfunded. This is not an outcome we should accept in a developed country.
The criminal jurisdiction of the Supreme Court - the Budget papers indicate there was a total of 688 non-appeal matters pending as at 30 June 2020, of which 195, or 28.3 per cent, were between 12 and 24 months old.
For the Supreme Court's appellant jurisdiction, a total of 19 appeal matters were pending as at 30 June 2020, of which four, or 21.1 per cent, were between 12 and 24 months old, with none being greater than 24 months.
I should note that the papers also state that this is below the national average, which is 25.3 per cent. However, I would call this a dubious honour, considering that 21 per cent is still about one in five cases facing a delay such as this. This is not fair to our court system, those affected by crime, our police, the Director of Public Prosecutions, or those who are awaiting trial.
I note that the Crown Law budget is seeing greater investment over the forward Estimates - up from $6.9 million in 2019‑20, to $8 million in 2020‑21, with increases each year up to 2023‑24.
I further note, however, that these increases are primarily a reflection of additional funding for Crown Law legal risk management - a measure to enable Crown Law to meet the increasing demand for services to the Government and agencies as a function of the greater infrastructure program being implemented by the Government. It is not greater funding to ensure the DPP is better resourced to manage a perpetually increasing case load. I will certainly be asking questions relating to this in Budget Estimates, because this should be a top priority for the Government.
Moreover, the management of our prisoners and prison system is a much vexed issue, and one I know the member for Windermere will raise.
Mr Dean - What?
Ms ARMITAGE - Prison and prisoners.
Mr Dean - Yes, maybe.
Ms ARMITAGE - Over recent months the $5.7 million budget blowout of prison staff overtime has been highlighted equating to an average of $16 000 per employee.
No-one would say this is an efficient way to run a prison system. Cost per prisoner per day is set to rise from $335 per day from this financial year and this does not even factor in prisoner health costs borne by the Department of Health on behalf of Corrective Services.
The prison system has a foundation on high fixed costs, which are strongly affected by prisoner numbers, so properly managing this in concert with the high case load of the DPP will have significant effects on the Department of Justice bottom line in years to come.
I know $3.5 million per annum has been allocated in the Budget to assist with increasing cos