State Government Treasurer Tim Pallas handed down a Budget that has four step medium-term fiscal strategy to rebuild the Victorian economy after an economically ravaged 2020. These steps include:
1. Creating jobs, reducing unemployment and restoring economic growth
2. Returning to an operating cash surplus
3. Returning to operating surpluses
4. Stabilising debt levels
Our Budget Snapshot
Advanced manufacturing, engineering and design
The former General Motors Holden site at Fishermans Bend will be turned into a global innovation hub housing the University of Melbourne’s School of Engineering from 2024. The hub is expected to become a world-renowned centre for innovation by 2051, supporting up to 30 000 high-value science, technology, engineering and mathematics jobs.
A $33 million investment in the agriculture industry to grow and protect the sector so it continues to be a cornerstone of the state’s economy, in line with the 10-year Agriculture Strategy.
That includes investing $12 million to deliver the establishment of a traceability information hub, the development of new systems to prove the origin and quality of Victorian produce, and campaigns to promote the paddock‑to‑plate journey of Victoria’s produce.
Construction & Property Services
A minimum mandate of 90 per cent local content on major government infrastructure projects and mandated use of local apprentices, trainees and cadets.
The Government will spend $1.6 billion for new schools and upgrades to existing schools, including:
• $492 million to build 13 brand-new schools;
• $340 million to upgrade 52 schools;
• $188 million to deliver maintenance upgrades at schools across the state;
• $105 million for relocatable buildings.
A further $294 million will be allocated to development, upgrade or expansion of 9 hospitals.
• $21 million to improve the safety and access of walking and cycling network;
• $5 billion for the Melbourne Airport Rail Link and $2.2 billion for the Suburban Rail Loop;
• $5.3 billion in social and affordable housing.
Health, Medical Devices & Technology
$103 million to upgrade medical equipment, technology and infrastructure.
$850 million in additional funding to mental health programs.
Textiles, Clothing & Footwear
Ethical Clothing Australia will be funded to ensure government uniforms and PPE are bought from accredited ethical and local sources.
CBD Arts, Tourism & Hospitality
A $7.4 million voucher scheme to entice Melburnians and visitors to city cafes and restaurants, and support CBD arts and cultural events.
$200 million Melbourne City Revitalisation Fund – jointly funded with the City of Melbourne – to help renew city spaces and support CBD arts and cultural events.
A $10 million distillery door grant scheme.
Training & Learning
The establishment of the Victorian Skills Authority to bring together industry, providers and other stakeholders to identify priority training areas, culminating in an annual Victorian Skills Plan.
• Up to 12 200 extra subsidised training places in our TAFE and training;
• Providing 4 800 additional places in digital literacy and employment skills courses;
• Increasing the funding provided to TAFEs and other registered training providers.
$986 million to build 25 X’Trapolis 2.0 trains and supporting infrastructure for the metropolitan train network.
The Zero Emissions Vehicle Roadmap includes a vehicle purchase subsidy incentive for household and business buyers.
For Small & Medium Business
New Jobs Tax Credit, which supports small and medium businesses to rehire staff, restore hours and create new jobs. Under the initiative, a business with e Australia-wide annual taxable wages of less than $10 million for the 2020-21 and 2021-22 financial years will receive a tax credit of 10 cents for every dollar of Victorian taxable wages that is additional to those paid for the previous financial year. Eligible employers will receive the benefit of the New Jobs Tax Credit automatically through their payroll tax account with the State Revenue Office.
Eligible small and medium-sized enterprises claiming the Commonwealth Government’s R&D Tax Incentive will have access to low interest loans for up to 80 per cent of their forecast refundable tax offset.
The Government will bring forward tax cuts for businesses to 1 July 2021. The payroll tax‑free threshold will be increased to $700 000. The regional employer rate will also reduce from 2.02 per cent to 1.2125 per cent from 1 July 2021.
• A rate of 0.5% will apply for businesses with national payrolls above $10 million, and businesses with national payrolls above $100 million will pay an additional 0.5%;
• A concession of up to 100 per cent of stamp duty for new dwellings worth up to $1 million in the Melbourne local government area;
• Temporarily increasing the eligibility thresholds for off‑the‑plan purchases;
• Extending the vacant residential land tax exemption for new developments.
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Did you see our Federal Budget Update? Read it here