By Dr Tony Matthews, Cities Research Institute
The 2018 Queensland budget, the first for Treasurer Jackie Trad, offered some surprises in its treatment of housing, the environment and the regions. As is the tradition with budgets, some people feel cheerful while others are glum. Most are probably neutral this time around.
Changes to the housing portfolio will make some very unhappy, a few will celebrate and many won’t be affected.
The First Home Owner Grant of $15,000 will be extended for another 12 months. But pain comes through its value being reduced from the temporary amount of $20,000, in place since 2016. Those hoping to take advantage of the higher rate will need to do so by June 30 – an unreasonable deadline for most.
House prices are softening slightly in south-east Queensland and across the state as the urgency recedes from the market. The reorganisation of the First Home Owner Grant probably reflects these changes, as well as an argument that falling prices benefit first homebuyers, thereby reducing their need for the higher grant.
The few hundred (by the Government’s estimate) trusts and owners with property holdings over $10 million face a 0.5% increase in land tax. This will be felt as it could add up to tens of thousands, perhaps more, for many of those liable. The public are unlikely to be sympathetic, so the Government can collect more revenue and spin a voter-friendly story with this measure.
Government can do similar with their increase in foreigner acquirer duty, from 3% to 7%. This may limit foreign ownership of housing and apartments, which the public will broadly welcome, while extracting more money from those still determined to invest.
The $339.1 million pledged towards construction and upgrades of social housing in Brisbane is to be welcomed, though details on how the money will be spent remain vague. Still, it is bright news.
The environment played a secondary role in this budget, with attention focused almost exclusively on waste management and the Reef.
Previous pricing arrangements, which made it cost-effective for other states to dump their waste in Queensland, will be replaced with a new waste levy of $70 per tonne from 2019. Less waste is, of course, good for the environment but this budget measure offers added value as $100 million will go towards projects designed to turn waste into energy.
The Local Government Association of Queensland was quick to respond, pointing to their plans for councils to partner in building waste to energy plants. Such developments are commonplace in other countries (Sweden, Germany) and could work well in Queensland.
The Great Barrier Reef was highlighted, with $330 million pledged over the next five years. This will add to Federal Government investment. As welcome as this is, it is limited relative to the scale of the Reef’s problems. Long-term funding and better management, including reduced shipping volumes, are desperately needed.
Two small but welcome environmental grants were tucked away in the budget and could easily go unnoticed. These are $34.6 million for drought relief in the Darling Downs and the $102.2 million pledged to Outback Queensland for recovery and resilience against natural disasters. Both will be widely welcomed on the ground.
Queensland’s regions will be pleased with the strong infrastructure, health and education spending agendas in this budget. There was little of note for the regions outside of those big-ticket items.
Many regional Queenslanders are probably anxious these days about declining employment prospects, environmental problems and tentative local economies. While the budget offers some good news, it is unlikely many will feel the measures will benefit them personally.
So, overall, the 2018 Queensland budget was a mixed bag for housing, the environment and the regions. As ever, there are winners and losers. The Government probably feel happy but it’s likely most people feel pretty neutral. That may be a good result as far as the new Treasurer is concerned.