Justine Elliot (Richmond, Australian Labor Party) Share this | Hansard source

I rise today to speak in support of the debate on the Appropriation Bill (No. 1) 2026-2027 and related bills. This Labor budget is focused on relief, resilience and reform that delivers for all Australians. That's why this budget is delivering more tax cuts, a stronger Medicare and a fair go at homeownership. It's delivering more cost-of-living relief and helping build an economy that works for more people. We know that people are doing it really tough right now. Cost-of-living pressures have been compounded by the conflict in the Middle East, while at the same time we face longstanding challenges when it comes to productivity, intergenerational equity and access to housing.

Over the past two decades, house prices have risen by around 400 per cent, and incomes have not kept pace. We can't just ignore this problem and the impact that it's having on Australians, particularly young people with aspirations of homeownership. So we are taking action and overhauling the rules for negative gearing and capital gains tax. These changes have been carefully designed to help more Australians into homes and encourage the kind of market activity that leads to more supply.

We're also making other very important changes to Australia's tax system. The package of tax reform and relief in this budget will reduce the tax burden for over 13 million workers, support 75,000 more homeowners into the housing market, deliver over $3.5 billion in new measures to lower taxes for businesses and reduce compliance costs by $540 million a year. This is an ambitious Labor budget because the Albanese Labor government is committed to building resilience, bolstering the economy and delivering for businesses, first home buyers and future generations of Australians. The budget's about more cost-of-living relief, more Medicare, more aged care and more housing.

The budget contains the most significant tax reform package in more than a quarter of a century. This package of tax reform and tax relief is about making our economy work in the interests of more Australians, more Australian businesses and all those future generations. It's a package that's pro aspiration, pro worker and pro investment. The budget delivers a new and permanent tax cut for Australian workers. Every working Australian will benefit from the $250 working Australians tax offset, along with the $1,000 instant tax deduction. The working Australians tax offset will begin to apply for income earned from work for the second half of 2027 and will automatically reduce workers' tax liability for the 2027-28 income year. It will lift the effective tax-free threshold for eligible workers by almost $1,800. This is the largest permanent increase to the effective tax-free threshold since 2012-13. This new offset will provide responsible cost-of-living relief and help make the tax system much fairer for workers. It will help Australian workers to keep more of what they earn, incentivise participation for lower income workers and, very importantly, help with the cost of living. The $1,000 instant tax deduction will allow workers to deduct up to $1,000 from their taxable income without having to keep receipts. What a big difference that will make. These measures all build on the legislated tax cuts starting in July 2026 and July 2027. The combined benefit to an Australian worker on average earnings from our three tax cuts, new tax offset and instant tax deduction will be up to $2,816 from 2027-28.

We're also making changes to ensure more equal and sustainable treatment between workers earning a living from wages and those with income from assets held in trusts. Currently, discretionary trusts allow some Australians, often high-wealth individuals and families, to plan their tax affairs in ways that aren't available to most people. From 2028-29, a minimum 30 per cent tax rate will apply to discretionary trusts. This will make the tax system fairer and more sustainable by aligning tax paid by trusts more closely with the income tax rates paid by the vast majority of Australians. Importantly, primary production income earned through discretionary trusts will remain exempt, recognising the unique income volatility and seasonal nature of farming businesses.

In this budget we're creating a fairer system for first home buyers and future generations. Our reforms are about helping more Australians buy a home, encouraging investment in new housing supply and helping to fund new tax cuts for workers. Fixing the tax treatment of capital gains is necessary so that it operates as originally intended, by helping to ensure investment flows to where it's most productive. We're replacing the 50 per cent capital gains tax discount with inflation adjusted indexation to restore the taxation of real gains. We're also establishing a minimum tax rate of 30 per cent on realised gains. Importantly, income support recipients, including pensioners, will be exempt from the minimum rate. These changes apply from 1 July 2027 to all assets except new builds, where both new and old arrangements will be available to choose from. Any gains made up to 1 July 2027 will be treated under the old rules. We know that early-stage and startup businesses, particularly in the tech sector, have unique features, and further consultations are being undertaken with stakeholders to clarify the details for implementations for these kinds of businesses. We're also limiting negative gearing for residential properties to new builds that add to the supply of housing that we desperately need. For properties purchased after 12 May 2026, negative gearing can be used until 2027-28. For all existing investments made before 12 May 2026, negative gearing arrangements will remain absolutely unchanged.

These changes to the tax system will help around 75,000 Australians get into the market over the next decade. This is the equivalent to reversing around a decade of decline in Australia's homeownership rate. All of these changes, when combined with our other massive housing reforms in the budget, will boost supply of housing by another 30,000 homes over 10 years, which are all desperately needed.

The budget, really importantly, also includes an investment of a further $2 billion in a new local infrastructure fund for enabling infrastructure. Enabling infrastructure refers to roads, water, power and other systems required for all these housing projects to go ahead. This funding will be provided to local governments and our state utility providers responsible for this infrastructure. Access to the fund will require state based reforms to improve productivity in the housing sector. This means faster and simpler approvals, freeing up more land to build new homes and the delivery of a consistent National Construction Code. The local infrastructure fund will support up to 65,000 more homes over 10 years, and reforms to cut red tape have the potential to support tens of thousands of additional homes, as well as reducing regulation costs by up to $3 billion a year. This brings the value of our Homes for Australia Plan to more than $47 billion—a massive investment. We're also committing $59.4 million of funding to community housing providers to help secure social housing for more than 4,000 eligible young people at risk of homelessness.

Very importantly, in this budget, we did as we always do—strengthen Medicare and deliver better health outcomes—because we're committed to delivering on all of our plans, like cheaper medicines, a stronger Medicare, more bulk-billing, more doctors and nurses and more urgent care clinics. In this budget, we've committed $1.8 billion over five years and more than $500 million ongoing to make urgent care clinics permanent—a great initiative. These clinics provide fully bulk-billed and accessible care, taking pressure off hospitals and making life easier for so many Australians who use these services.

In my electorate of Richmond, more than 5,400 people have visited the Tweed Heads Medicare urgent care clinic since it opened in December last year, delivering vital reform for access to health care for locals. As part of this budget, we're also delivering a landmark $25 billion in additional funding for state and territory hospitals, to reach a record $220.3 billion over five years. We're investing $5.9 billion in this budget to list new medicines on the PBS, including treatments for cystic fibrosis, chronic kidney disease, some cancers and many more. Since July 2022, our government has funded over 430 new or amended PBS medicines. When it comes to cheaper medicines, across my region we've had more than 2.6 million scripts for cheaper medicines that have been filled. That's making a huge difference to so many people in my region.

Earlier this year, our government took immediate and effective action following the outbreak of the crisis in the Middle East and the absolute disruption of the global fuel supply. We cut the fuel excise by more than half, reduced the heavy-vehicle road user charge to zero for three months and doubled penalties for major breaches of consumer laws. We also secured more than a billion litres of extra fuel from March to June by relaxing the minimum stockholding obligation, underwriting additional cargoes and adjusting fuel standards, and now we're focused on building up reserves for the future and ensuring Australia's energy sovereignty. In this budget we saw our government establish a $3.2 billion government controlled Australian Fuel Security Reserve, and increase Australia's diesel and jet fuel reserves to 50 days. It's so vitally important that we do that. We're also taking action to secure more gas for Australian homes and businesses through a domestic gas reservation scheme. This scheme will require gas exporters to supply around 20 per cent of exports to the Australian market. This will put downward pressure on domestic prices while shielding our market from global price volatility and making us more resilient to any potential supply shortfalls.

As in all budgets, we're backing businesses. We're backing small businesses with this budget, we know that the key to higher wages and higher living standards is lifting productivity, and small businesses and start-ups are an important part of that. This budget contains $3.5 billion in new measures aimed at lowering taxes for businesses, increasing cash flow and supporting growth to boost investment. New measures include making the $20,000 instant asset write-off permanent, which will give businesses more certainty and allow them to invest in themselves with confidence. It's anticipated this change will slash compliance costs for small businesses by around $32 million a year, saving more than 350,000 hours on record-keeping. It will deliver around $890 million in cashflow support over the next five years.

There's so much more in this budget providing assistance to Australians right across the board. There are so many measures that we have, particularly the indexation of many social security payments and more than $3 billion for aged care, including more beds and more packages. We know how vital this is, particularly in my electorate and the large number of senior Australians that we have. This is an issue and we've responded to that with more beds and more packages. We've also got more than $180 million in this budget to make the child support scheme safer and fairer, helping to ensure single parents and their kids get the support they need. Also in the budget is more than $27 million to reduce prices for essential groceries across remote Australia.

Right across the country, wherever that need is, we have really addressed this with this budget. This really is a Labor budget built for resilience in incredibly uncertain times and incredibly uncertain global times, yet at the same time we are reforming for the future and particularly addressing that intergenerational equity that we've spoken about and that people raise all the time. We've done that through our reforms with negative gearing and the capital gains tax. This budget recognises the absolute pressures that Australians are facing today while also taking on the long-term challenges that have, in fact, been ignored for too long, particularly when it came to housing. We saw the previous government just ignore the housing crisis, and it built up worse and worse for years. Since day one, since we've been in government, we've invested a massive amount in all areas of housing. Whether it's that five per cent deposit or whether it's making these important reforms, plus our massive investment in social and affordable housing and massive building right across the country, we are absolutely committed to making sure that Australians—particularly young Australians—can access homeownership.

In this budget we are delivering cost-of-living relief without losing sight of productivity, housing supply, energy security or that really important intergenerational fairness. This budget invests in workers, backs small businesses and strengthens Medicare. One of the biggest issues in my electorate is accessing healthcare. We've seen more than 30 GP clinics that are now fully bulk-billing. It's making a huge difference to locals.

This budget also supports vulnerable Australians and really, at the end of it, also helps more people achieve the security of their own home, because we want to build an economy that works for everyone, no matter where you live. Particularly for areas like mine in regional Australia, this budget really provides a lot of assistance. We want to build an economy that's stronger, fairer and, really importantly, more resilient to the many global shocks that we have seen. We're building that economy not just for today but for future generations of Australians, particularly through our housing reforms to ensure there's an even playing field for younger Australians. And the response to this has been overwhelming because young people have had so many difficulties in accessing housing.

This is a government that acts right across the board in terms of providing support now and building for future generations.

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