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NSW 2020 State Budget and what it means for you from a practical perspective...

Thursday November 19 2020

The NSW 2020-21 State Budget was delivered with a focus on assisting recovery in our State.  There were many initiatives some relevant to business and others to the residents of our state more broadly.

 

The initiatives of relevance in our everyday lives are:

 

Business Recovery

Businesses in the hospitality industries are set to benefit from a voucher program designed to encourage people to get out and spend.  NSW resident's aged 18 and over will receive $100 worth of digital vouchers to spend at restaurants, cafes, bars, performing arts venues, cinemas, visitor sites, cultural attractions, or amusement parks.  The vouchers will not be available to pay for accommodation services or alcohol (as announced but not yet legislated).

The program will be trialled in Sydney's CBD in December and is anticipated to be rolled out across the rest of the state in the new year.

 

Job Creation

Payroll tax is set to be overhauled again with the threshold for payroll tax increasing from $1 million to $1.2 million.  It is anticipated this tax cut will ensure businesses feel more confident to hire more staff and, in turn, stimulate the economy.

Other small businesses that do not pay payroll tax will receive $1,500 of digital vouchers to help pay for government fees and charges.  Further information regarding the application of this system is yet to come.

When the Federal Government's JobKeeper program runs out in March, the aim is to transition as many people as we can into paid regular employment.  The current unemployment rate sits at 7.2 per cent and is expected to peak at 7.5 per cent in the December quarter.  The Government's measures aim to reduce unemployment to 5.25 per cent and put 270,000 people back into work by June 2024.

The Jobs Plus program aims to create up to 25,000 new jobs by mid-2022 by encouraging interstate and international businesses to relocate to NSW.  Under the program, businesses that create at least 30 new jobs will receive payroll tax relief for up to four years.

 

Home Buyers

Home buyers in could be winners under a major overhaul of the state's stamp duty tax aimed at addressing our inefficient property tax system.  The proposed reforms mean buyers would be given the choice of paying stamp duty or a smaller annual property tax with the aim of getting more first home buyers into the property market.

This is a proposal and community feedback will be sought on the proposed model.

 

Childcare

Parents of young children will get a helping hand with the extension of the free preschool scheme for all of 2021.

The budget provides 15 hours of free preschool each week for children aged three to five.  It applies to children who attend community preschools across the state and should save each family about $2,000.

This measure is an extension of the Government's response to the pandemic from April and an attempt to provide certainty to family budgets.

 

Education

Students are set to receive free tutoring in 2021 under a landmark program aimed at providing extra support after a disruptive school year.  Up to 5,500 additional staff will be employed to provide small group tuition at every NSW public school and non-government schools with the most need.

In addition, this will provide casual or retired teachers, university tutors and final-year teaching students with employment opportunities.

 

Women - Return to Work

It has been identified that women have been more affected by unemployment during the pandemic.  To counter this women who have lost their jobs because of the pandemic will now have access to up to $5,000 in grants to help them get back to work.  The grants will be available in varying amounts and applicable to training, transport, childcare, equipment, and other applicable expenses.

Any woman who has been out of work for a month can apply.

 

Health

With no sign of the pandemic ending, NSW's COVID-19 health response has received additional funding.

Funding has been allocated for COVID testing clinics, quarantine hotels, increased contact tracing and pathology testing.  Additional resources are available for personal protective equipment for health workers, and for fast-tracking research and clinical trials.

The state's elective surgery lists are also to be addressed after delays during the height of the pandemic.

The budget also includes funding for life-saving gene therapies. The highly specialised treatments are some of the most expensive in the world.  The new funding means some people with genetic diseases and rare cancers will soon have access to previously unaffordable treatments.

As the mental health impacts of the pandemic become more obvious, funding has been made available employ 100 nurses to service 2,000 public schools across the state.  The aim is to embed a dedicated health professional who can look holistically at the health and wellbeing of students.

In addition, mental health services, Headspace and Lifeline, have been granted funds to set up 12 community-based programs to reduce suicide rates.

 

As with any budget these are announcements and are not yet fully legislated.  They are accompanied by a host of other announcements aimed at stimulating economic recovery in NSW and assisting those who find themselves in need.