ALGA Analysis of the 2021-22 Federal Budget

Fact sheet 3: 2021-22 Budget Overview

1. General overview and economic outlook:
Deficit will reach $161b this year
Forecast growth of 1.25% 2021-22, 4.25% 2022-23
5.6% unemployment falls to 5% in 2022-23
International border closures until 2022-23

2. Budget priorities:
Secure Australia’s economic recovery
Build for the future
Job creation

3. Key initiatives and savings measures:
Health services – vaccine roll out
Tax relief
Housing and small business
Skills. training and childcare

4. ALGA Board priorities

ALGA Board PrioritiesCoalition Budget 2021-22 Measures
Financial Assistance Grants
In 2021-22 the Australian Government will provide $2,652.2b in Financial Assistance Grants funding. This includes $1.3b which was brought forward from the 2021-22 estimate and paid to States and Territory Governments in 2020-21. The remainder is $1.326.1b in 2021-22. (Budget Paper 3 p89)

Commonwealth estimated taxation revenue (on accruals basis) for 2021-22 is $445.6b (Budget Paper 1, Statement 5 Table 5.1 P129).

The Financial Assistance Grants as a proportion of Commonwealth Tax Revenue in 2021-22 is therefore estimated to be 0.6 %. This is unchanged since 2020-21 because. In 2022-23 it is expected to be 0.6%.

Local Roads and Community Infrastructure ProgramLocal Roads and Community Infrastructure – extension – further $1b over two years, $400.7m in 2021-22 and $600.7m in 2022-23 (BP2 P161). Total expenditure is $2.5b.

Stronger Communities Program Round 7 for small capital projects – $28.2m over two years (BP2 P167)

Building Better Regions Fund Round 6 – $256.5m over four years (BP2 P169)

Local Roads Investment Program
National Freight and Supply Chain Strategy – additional funding $28.6m over four years including end to end performance evaluation for freight system and $12.1m over three years to fund engineering assessments for local government roads.
(BP2 P163)
Roads to Recovery
$499.5m in 2021-22 (BP3 P59)
$499.5m in 2022-23
$476.7m in 2023-24
$499.5m in 2024-25
Black Spot Program
Office of Road Safety – additional resources – $5.1m over four years (BP2 P165)

Road Safety Program – extension – $1b in 2022-23 includes small scale projects – primarily to State/Territory Governments (BP2 P166)

$137m in 2021-22 (BP3 P55)
$117m in 2022-23
$110m in 2023-24
$110m in 2024-25

South Australia Road Funding$20m per year over two years (BP2 P156)
Disaster Mitigation Program
Drought Response, Resilience and Preparedness Plan – $212.2m over four years including funding for local government (BP2 P56)

Building Australia’s Resilience – $1.2b over five years for improving preparedness and response to natural disasters (BP2 P65) – various measures including $4.5m over two years for resilience capability including at local level.

Disaster Recovery Funding Arrangements – $275.9m over three years (BP2 P130)

Stronger Regional Digital Connectivity Package
Digital Economy Strategy – $1.2b over six years (BP2 P73) – includes Peri-urban mobile program of $16.4m over three years for bushfire prone areas (BP2 P74)

Regional Connectivity Program – $84.8m over 2 years (BP2 P169)
Local Government Arts and Culture COVID-19 recovery
COVID-19 Response Package – additional arts sector support – $229.9m over two years (no direct local government funding) (BP2 P148)

Indigenous Visual Arts Industry Innovation – $28.1m over five years (BP2 P150)

Circular Economy
Incentivizing recycling behaviors – $11m over 4 years (BP2 P57) includes $5.9m over four years for a further grant round of National Product Stewardship
Investment Fund (BP2 P57) and $5m over three years for Recycling Label (BP2 P57)

Organic waste – Food Waste for Healthy Soils Fund $59.8m over four years and $7.2m over four years for a community and education program (BP2 P53)

$5.4 million towards the Southern Adelaide Materials Recovery Facility in South Australia (BP2 P147)

Local Government Climate Response Partnership FundSee Disaster Mitigation Funding above

5. Other measures of interest for Local Governments in the Coalition Federal Budget:

• Home Ownership – First Home Super Saver Scheme (BP2 P17) and First Home Super Saver Scheme (BP2 P17) Home Builder Extension (BP2 P187)
• Managing burden of feral animals, pests and weeds – $29.1m over four years (BP2 P52)
• EPBC Review Response – $29.3m over four years (BP2 P57) includes independent Envt Assurance Commissioner, extra resources and protection of indigenous cultural heritage.
• Murray Darling Basin, managing water resources – $1.5b over four years (BP2 P58)
• Oceans Leadership Package – $100.1m over five years (BP2 P59)
• Roadmap for respect – sexual harassment $9.3m over four years (BP2 P61)
• COVID-19 Response Package – aviation and tourism support $1.8b over four years (BP2 P69)
• Women’s Economic Security Package – $1.8b over five years (BP2 P81)
• Women’s Safety – $998.1m over four years to reduce and support victims of domestic violence (BP2 P83)
• Newcastle Airport Improvements – $66.1m over two years (BP2 P86)
• Addressing workforce shortages on key areas – Job Trainer Fund extension – $506.3m over two years (BP2 P88)
• Boosting Apprenticeships Commencements wage subsidy – $2.7b over four years (BP2 P88)
• Child Care – $1.6b over four years (BP2 P91)
• Aged Care – Royal Commission Response – $698.3m over five years (BP 2 P99)
• Aged care – home care – $7.5b over five years (BP2 P100)
• Guaranteeing Medicare – rural workforce strengthening – $80.9m over five years (BP2 P111)
• Mental Health – $2b over four years (BP2 P117)
• Emissions Reduction and New Investments – $1.6b over ten years (BP2 P138)
• Northern Australia – next five year plan $189.6m over five years (BP2 P142)
• Community Development Grants Program – $55.5m over three years – specific projects identified (BP2 P147)
• Infrastructure Investment – by State/Territory (BP2 P 151 – 160)
• National Water Grid – $160m over two years includes specified projects (BP2 P164)
• Registration of Remotely Piloted Aircraft Systems and Fee Reform – $28.3m (BP2 P165)
• Rebuilding Regional Communities – $6.1m over 2 years (BP2 P169)
• Scoping public service hubs in Regional Australia – $0.6m in 2021-22 (BP2 P169) and regulatory barriers for business relocation in regional Australia
• Indigenous Skills and Job Advancement – $243.6m over five years (BP2 P173)
• National Strategy to prevent and respond to child abuse – $146m over four years (BP2 P174)
• Cyclone and related Flooding Insurance Pool for Northern Australia – $2.4m in 2021-22 to establish a task force (BP2 P186)
• National Housing and Urban Research Program $5.8m over three years and Housing Data Dashboard (AIHW) – $1.2m over four years (BP2 P188)