Introduction

The State economy is much stronger than forecast at the 1 December State Budget – debt and unemployment are lower providing confidence for the 2021-22 year. The Budget builds on policies and programs that formed the Queensland Economic Recovery Plan.

Economic Statistics                                      

Deficit:

A General Government operating deficit of $3.803 billion is forecast in 2020–21, an improvement compared to the $8.633 billion deficit forecast in the previous Budget and a return to an operating surplus is forecast in 2024–25 – $153 million.

General Government Revenue for 2021-22 is $63.664 b; Expenses $67.148 b; deficit $3.485 b.

Total debt:

The budget papers reveal Queensland’s total debt will now be $122.3 billion in 2023-24 – $7.7 billion better off than initially forecast. Debt, at this stage, is forecast at $127.7 billion by 2024-25, as the government’s budgetary outlook improves courtesy of increased revenue from a recovering economy and a reduction in government expenditure.

Net worth:

General Government Sector net worth was $193.731 billion at 30 June 2020. It is expected to increase to $204.691 billion in 2020–21, over $13 billion higher than expected in the 2020–21 Budget.

GSP:

Robust ongoing growth of 2¾ per cent is forecast for 2021–22 and in each subsequent year across the forward estimates. The strength of the Queensland economy has been underpinned by elevated activity in consumer spending and the housing sector.

Unemployment rate:

Ongoing strong employment growth of 3 per cent in 2021–22 is expected to drive down the unemployment rate to 5¾ per cent by June quarter 2022, with the unemployment rate steadily improving across the forecast period to be 5 per cent by June quarter 2025.

Public Service Expenses:

$27.474 billion

In 2021–22, employee expenses are expected to be $27.474 billion, $1.189 billion or 4.5 per cent higher than the 2020–21 estimated actual. This reflects the increase in key frontline service areas of health and education due to demand for health services, and student population growth.

Revenue:

Revenue estimated to be $63.664 billion in 2021-22 – up from $60.396 (actual) in 2020–2021.

State Taxation revenue:

No new or increased taxes. The money flowing back to government coffers is forecast to grow by 9.4 per cent in 2021-22.

Taxation revenue is forecast to be $1.492 billion (9.4 per cent) higher in 2021–22, primarily driven by continued strength in transfer duty and a rebound in payroll tax as employment and business conditions improve.  Taxation revenue will increase from $15.907b in 2020-201 to $17.399b in 2021-22.

Vehicle transfer duty budget for 2021-22 $663 up from the low of $533m in 2019-20 resulting from the fall in new car sales.

Motor vehicle registration budget for 2021-22 is $2,044 m; the estimated budget for 2020-21 is $1,987 m.  Motor Vehicle Registration contributes 11.7% of State Taxation categories.

Payroll tax budget for 2021-22 is $4,192 m and for 2020-21 was $4,192 m. Payroll tax contributes 25.8% of State Taxation categories.

Royalties:

Royalties and land budget for 2021-22 is $ $3,341 up from the 2022-21 budget of $2,667.

Waste disposal levy:

The levy commenced at $75 per tonne for general waste and is regulated to increase by $5 per tonne per annum for the first 3 years. The first annual increase of $5 per tonne was deferred by 6 months to 1 January 2021 to provide financial relief from the impacts of COVID-19. Seventy per cent of proceeds from the waste levy will be used for resource recovery and other programs that reduce the impact of waste and protect the environment and local communities

Revenue from the waste disposal levy is estimated to be $291 million in 2020–21. Revenue is forecast to grow by 8.9 per cent in 2021–22 and 5.3 per cent in 2022–23, reflecting expected growth in waste disposal as well as regulated levy rate increases.

Capital Works Program:

In 2021–22, $14.688 billion will be invested in  capital works across the state.  Capital program directly supports around 46,500 construction-related jobs in 2021–22, including 29,800 jobs outside of the Greater Brisbane region.

Business:

As part of the COVID-19 Fiscal and Economic Review released in September 2020, the government announced the Backing Queensland Business Investment Fund (BQBIF). This support is continuing through the $100 million Business Investment Fund, which is part of the BQBIF, to drive investment in established small and medium sized businesses to help them innovate, build scale, realise their potential, and promote job creation in Queensland.

Up to $140 million in additional funding over 4 years for a revitalised Back to Work program, helping provide businesses with the confidence to employ Queenslanders facing labour market disadvantage

Small Business:

A target of 25 per cent of all government purchases to be from Queensland small and medium size businesses from July 1 which will be extended to 30 per cent by June 2022.

$140 million Big Plans for Small Business commitment, which has a strong focus on helping small business to innovate, grow and access new markets. This includes $100 million from the Business Investment Fund (BIF) to support established small and medium businesses innovate and realise their potential.

Queensland is also continuing to implement the 7 key reforms under the Small Business Regulatory Reform Agreement with the Australian Government. This includes a range of innovative reforms developed and implemented by the Queensland Government including: reforms targeting small business renewal and start-ups; improving information available to businesses on vocational education requirements; and streamlining requirements and permits related to food safety, transport and agricultural activities. The flagship initiative under this program, the Business Launchpad, will reduce the amount of paperwork and approvals that start-up and expanding small businesses are required to obtain from all 3 levels of government

Training:

The 2021–22 Budget outlines additional funding investment in skills and training to meet the needs of the private sector and help individuals to re-engage with the labour market as the economy recovers.

Additional funding provided in this Budget for key initiatives include:

• $320 million over 4 years to extend the Skilling Queenslanders for Work (SQW) program, with the revitalised program assisting up to 15,000 Queenslanders facing disadvantage in the labour market each year. This program is now being permanently funded, embedding the program into the core business of the state
• up to $140 million in additional funding over 4 years for a revitalised Back to Work program, helping provide businesses with the confidence to employ Queenslanders
• $31.2 million to extend the 50 per cent payroll tax rebate for apprentice and trainees for another 12 months to 30 June 2022
• partner with government, industry and local communities to contribute to the economic success of the state
• $100.5 million matching investment as part of the initial national JobTrainer Fund
• Vocational Education and Training (VET) – Certificate 3 Guarantee Tuition Fee Subsidy The Vocational Education and Training (VET) Certificate 3 Guarantee Tuition Fee Subsidy provides a government subsidy to allow eligible Queenslanders to obtain their first post-school Certificate III qualification to help them gain a job or to improve their employment status, including pathways for disadvantaged learners and Queensland school students (VET in Schools). The subsidy is available to pre-approved private and public registered training organisations to subsidise tuition fees paid by students undertaking eligible vocational education and training qualifications (primarily Certificate III qualifications). The value of this subsidy for each qualification ranges from $472 to $6,650, depending on student eligibility and qualification subsidised. The average subsidy value is $3,060.
• User Choice – Apprentice and Trainee Training Subsidy The User Choice – Apprentice and Trainee Training Subsidy program provides government funding towards the costs of training and assessment for eligible Queensland apprentices and trainees, or complementary pathways leading to apprenticeship outcomes. The subsidy is available to pre-approved public and private registered training organisations to subsidise tuition fees to reduce the cost of nationally recognised entry level training for apprentices and trainees. The program provides greater flexibility for apprentices, trainees and their employers to select a preferred registered training organisation and to negotiate the type of training to meet their specific needs. The value of this subsidy for each qualification ranges from $1,180 to $50,720, depend
• VET – Higher Level Skills Tuition Fee Subsidyy provides a government subsidy to eligible students and employers to undertake a priority Certificate IV, diploma or advanced diploma qualification or industry endorsed skill set. This program assists individuals to gain employment in a critical occupation, career advancement in a priority industry or transition to university to continue their studies. The subsidy is available to pre-approved private and public registered training organisations to subsidise tuition fees paid by students undertaking eligible vocational education and training qualifications at Certificate IV or above. The value of this subsidy for each qualification ranges from $1,175 to $10,370, depending on student eligibility and qualification subsidised. The average subsidy value is $4,384.
• Travel and Accommodation Subsidy provides financial assistance to Queensland apprentices and trainees for travel expenses incurred in attending off the job training at a registered training organisation. To be eligible, apprentices must attend the closest registered training organisation that offers the required qualification and travel a minimum of 100km return from their usual place of residence to the registered training organisation. The subsidy provides for:
• return land travel to the registered training organisation of 21 cents per km for distances between 100km – 649km, increasing to 26 cents per km for distances of 650km or more
• a return economy air ticket to the location of the registered training organisation if necessary
• cost of ferry travel if necessary
• accommodation assistance of $30 per day for overnight stay within Queensland and $72 for interstate travellers, if it is necessary to live away from their usual place of residence to attend training

Innovation:

Emphasis on growing the innovation economy

$2.6 million over 2 years to establish the Queensland Hydrogen Taskforce.

Advance Queensland. Advance Queensland has invested a total of $755 million, which has helped over 7,500 innovators and projects to succeed and supported 27,000 jobs across the state. This has included innovative enterprises such as Tritium, the world-leading Queensland based manufacturer of electric vehicle fast charging infrastructure

Transport: 

Continued implementation of The Future is Electric: Queensland’s Electric Vehicle Strategy, including delivery of the Zero Net Emissions Roadmap that will outline how the Department of Transport and Main Roads will lead the transition of Queensland’s transport sector to a low carbon economy.

QFleet will:

• continue the implementation of the QFleet Environmental Strategy for the Queensland Government motor vehicle fleet and QFleet Electric Vehicle Transition Strategy for the Queensland Government motor vehicle fleet increasing the range and number of low and zero emission vehicles available to be leased by customer agencies
• increase the number of electric vehicles in the government fleet by achieving annual targets within the QFleet Electric Vehicle Transition Strategy • complete implementation of the new QFleet fleet management system.

Energy: 

Continuing to regulate and provide strategic oversight of Queensland’s electricity and gas supply industries, and biobased petrol and diesel mandates.

Continuing to maintain the system for fuel price reporting to help motorists shop around and save at the bowser.

16 June 2021