The Treasurer handed down Budget 2018-19 at 7:30pm on Tuesday 8 May 2018. On the back of this announcement BUSY At Work examines the impacts to your business hiring practices and the services you receive from the BUSY team.
Overall this budget had a positive focus on employment, up-skilling and skilled migration, with vocational studies and education remaining much the same. Small business continues to attract funding focus which comes as no surprise considering the most recent NAB Quarterly SME Business Survey has found that it’s becoming more difficult for SMEs to find suitable labour. In fact, finding suitable labour is now the second biggest constraint on output for SMEs (just behind demand), continuing the upward trend that started in mid-2015.
So what are the Budget highlights for employers who are utilising government funding and support in employment?
The Government will provide $189.7 million over five years to support mature age workers that are registered with a JobActive provider and $19.3 million over three years to help workers aged 45–70 to transition into new roles.
More apprenticeships for Australians via the Skilling Australians Fund
The budget announcement also included a commitment to growing the number of apprenticeships in Australia. An estimated $1.5 billion will be committed through the Skilling Australians Fund to achieve this goal, with funding extended through to 30 June 2022. A level of funding for states and territories will be guaranteed, while extending the program from four to five years provides a longer timeframe to deliver more apprenticeship and other employment-focussed training.
The national partnership with the states will now commence on 1 July 2018 and provide an estimated $1.2 billion to support states and territories to deliver projects that will arrest the decline in apprenticeships. The Government is also making available around $300 million in 2017-18 to support states and territories to participate and those already helping to increase the supply of apprenticeships.
There was little in the way of new funding for the education sector in this year’s budget – with headline spending of an additional $24.5 billion over ten years in needs-based funding already announced in the 2017-18 MYEFO.
Other impacts to business that impact employment
The promise of massive infrastructure investment for road, rail, and project building could be a boon for small business by creating potential work for SMEs involved in construction, building and associated services. New infrastructure spending could provide further opportunities for many small businesses as more money is spent in areas where projects are being undertaken (e.g. food retailers, hospitality etc.). Longer-term benefits of new infrastructure for SMEs will also include improved access to retail and other services.
The Government has legislated tax cuts for around 3.3 million small and medium Australian businesses employing 6.8 million workers with annual turnover up to $50 million, as part of the Ten Year Enterprise Tax Plan.
The Plan has also increased the unincorporated small business tax discount rate from 5 per cent to 8 per cent (up to a cap of $1,000). This rate will increase to 16 per cent by 2026‒27.
Enterprise Tax Plan will reduce the company tax rate to around the median of the OECD. With the aim to keep Australia competitive.
Contained within the budget announcement is the fact that internationally, we are at risk of falling behind. Australia’s high business taxes has potential to become a drag on investment. Comparatively almost every other OECD country has lowered its effective tax rate on investment. So the focus on tax is an important one.
Changes for BUSY At Work customers?
Overall the strong focus on continued support for employment and up-skilling Australians ensures that BUSY At Work can continue to help your business source the right employees while providing support across the full lifecycle of your staffs employment journey. Find out how we can help you find the right person and access government funding and support by calling 13 28 79.