2021 Federal Budget looks to drive growth

The Australian Government’s 2021/22 budget has announced an expansion of tax cuts for business and workers to drive economic recovery while also making a record investment in the health of Australians with $503 billion to be spent over the next four years.

Federal Treasurer Josh Frydenberg’s budget promises $30 billion in tax breaks and boosts financial support for COVID-hit industries including the arts and tourism as the Australian Government looks to drive post Coronavirus growth in the economy and drive down unemployment.

Banking on a resurgence in household spending and business investment after Australia’s first recession in 30 years, Frydenberg said Australia was bouncing back from a downturn as a result of the global pandemic that could have been “so much worse”.

Overall, the Budget revealed a deficit set to reach $161 billion this year - $52.7 billion lower than expected six months ago.

The budget has also backed school sport while elite sporting bodies have secured funding commitments until Paris Olympics in 2024.

Tourism and Travel
Despite ongoing COVID outbreaks and delays to its vaccine strategy, the budget banks on Australia’s internal borders remaining open, domestic activity restrictions being lifted, and migration gradually resuming from mid-2022.

However, the budget steered clear of prescribing a date for the resumption of overseas travel, mentioning only that the risks posed by the international scale of the COVID-19 pandemic could continue to delay Australia's border reopening.

To support Australia’s airlines, the budget commits to maintaining an international airline capability through a new $200 million investment, supporting up to 8,000 jobs and enabling international flights to resume "when borders open".

The budget also confirms the delivery of the $1.2 billion package for aviation and tourism businesses, including 800,000 half-price airfares to domestic destinations, of which more than 660,000 have been sold already.

An allocation of $274.6 million will expand and extend current programs that are supporting businesses hard-hit by border shutdowns, including travel agents, zoos and aquariums.

Arts and Culture
The arts and culture sector received little new funding in the budget other than an additional $125.6 million over two years from 2020/21 to expand the Restart Investment to Sustain and Expand (RISE) Fund to provide financial support to support events or productions.

A further $11.4 million in funds has been allocated to support tourism in regional areas by providing further funding for the Regional Arts Fund, Festivals Australia program and the Indigenous Visual Arts Industry Support program and providing financial support for community museums, galleries and historical societies through the Australian Museums and Galleries Association (AMaGA).

In addition. $28.1 million over five years from 2020021 has been allocated to the Indigenous Visual Arts Industry Action Plan, to provide additional funding for the Indigenous Visual Arts Industry Support program and to support Indigenous arts centres and fairs through the impacts of COVID-19.

The budget also advised that the Australia Council for the Arts budget will remain unchanged while the National Archives, which needs $67.7 million to save its most urgent and at-risk materials will only receive an operating increase of $700,000.

Sport
The Federal Government’s Sporting Schools program has been boosted with almost $20 million committed for the next two years.

The 2023 FIFA Women's World Cup will receive $2.4 million towards setup costs with more to come pending confirmation of state government contributions while the Australian Sports Foundation will receive $4.7 million to support community sporting clubs through enhanced IT and cybersecurity to grow their fundraising capabilities.

Student Working Visas
The budget also contained a measure that will help international students who remain in Australia to work in industries including tourism and hospitality.

While continued international border closure until 2022 generally mean students cannot come or return to Australia to study, the Federal Government is allowing those who are already here to work more hours.

Adding tourism and hospitality to sectors eligible for the subclass 408 COVID-19 Pandemic event visa, the previous fortnightly limit of 40 hours of work for international student visa holders with jobs in hospitality and tourism is going to be scrapped temporarily.

Advice from the Federal Department of Home Affairs states "for the tourism and hospitality sector, the definition also includes work for employers whose primary purpose is to directly provide a service to tourists."

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