BUDGET REACTION – Master Builders Australia said its members were seeking a Federal Budget that supports the very businesses who have the opportunity to boost economic growth, bring down inflation and build for all Australians but are currently hamstrung by their capacity and increasing costs to deliver: builders.

“The Federal Budget has finally recognised the importance of a holistic, cross-portfolio approach to solving the housing crisis and made some inroads but has fallen short of supporting the businesses required to deliver on those projects,” Master Builders Australia CEO Denita Wawn said. 

“As it walks an economic tightrope, the Federal Budget has made positive steps towards boosting housing supply, but it can’t falter mid-way.

“To ensure the industry can build the 1.2 million new homes under the Housing Accord, government Ministers must sing from the same hymn sheet and focus all efforts on boosting housing supply.

“Building enough homes for Australians requires action beyond the housing portfolio and needs skills, migration, infrastructure, industrial relations, defence, social services, and industry portfolios to pull in the same direction,” Ms Wawn said.

“The housing crisis has been decades in the making with a number of portfolios working at cross-purposes and thwarting the industry’s capacity to build enough homes.

“Recent Master Builders research has found that policies outside of the housing portfolio like workforce shortages, industrial relations and material costs erode Federal Government housing funding.

“We must reduce the time it takes to build and minimise increasing construction cost blow outs in infrastructure, commercial and housing projects.

“There is still a long way to go, and Master Builders will work closely with the government to ensure the industry has the capacity and support to build for Australia’s future and continue to deliver strong economic growth for the country,” Ms Wawn said.

Housing investments

Ms Wawn said targeted measures in social housing, student accommodation and critical infrastructure “all go towards relieving some of the more acute supply pinch points”.

“We support the extension of housing programs and agreements including the additional $2.5 billion to increase the cap on bond aggregator financing,” she said.

“Measures to increase student accommodation by requiring universities to do their fair share of new home building for increasing migration numbers is welcome.

“Master Builders welcomes funding to help builders meet stringent federal safety accreditation standards in order to build through the Housing Australia Future Fund.

“Master Builders strongly supports the work of the Office of the Federal Safety Commissioner and its role to ensure industry participants engaging in federally funded work prioritise improvements in safety practices and culture,” Ms Wawn said.

Infrastructure

“Increased funding for critical infrastructure to support new home building reinforces the important role of commercial and civil construction in building sustainable communities,” Ms Wawn said.

Skills and training

“Master Builders welcomes funding to establish the Building Women’s Careers Program which will complement the work of Women Building Australia,” Ms Wawn said.

“Attracting more women in construction plays a critical role in making sure we can attract the half a million workers needed over the next five years.

“The announcement of Fee-Free TAFE and VET places in construction rightfully recognises the role of not-for-profit industry-led RTOs in training the next generation of tradies.

“It’s now up to state and territory governments to ensure industry-run RTOs are held on equal footing with TAFE.

“Master Builders welcomes the $1,500 per year per apprentice for Group Training Organisations to help them reduce fees for those studying in construction industries. This is a huge recognition of the important role GTOs play in supporting the next generation of apprentices,” Ms Wawn said.

“Industry-run RTOs and GTOs like those run by Master Builders associations around the country have excellent retention and completion rates, provide pastoral care and support to apprentices that help them find success in their trade.”

Migration

Ms Wawn said Master Builders Australia unde3rstood that skilled migration “represents a vital piece of the puzzle”.

“We know in the short-term the domestic workforce cannot keep up with demand,” she said. “The investment into prioritising and streamlining skills assessments in construction for potential migrants and those already in the country is a great start.

“For many migrants, it is simply too hard to have their professional capacity recognised to work in a trade in Australia, and they are instead in roles that present fewer hurdles to obtain.

“The Parkinson Migration Review found skills assessments or qualification recognition can take up to 18 months and cost nearly $10,000 – time and money people simply don’t have in this economic climate.

“We would have liked to see more financial support for migrants in Australia to be able to have their skills qualifications recognised or undertake the necessary gaps training to meet Australian standards,” Ms Wawn said.

Business support

Ms Wawn was pleased that the extension of the instant asset write-off took place, but warned it still “falls short of much-needed support for the 440,000-plus small businesses in the building and construction industry”.

“Overall, we have seen measures to support workers but very little for the businesses who are struggling to keep those very workers employed,” she said.

“It’s accepted across the board that business, including small business, is leaned on to spearhead economic recovery, but there have been minimal measures in the budget to boost business productivity,” Ms Wawn said.

Future Made in Australia

“Efforts to boost local manufacturing capability is something Master Builders has consistently supported together with ensuring more reliable global supply chains,” Ms Wawn said.

“Any innovation needs to ensure it is well-targeted and adds value, not risk to building outcomes.

“In the past, we have seen risks emerge with the rush to innovate that contribute to poor building systems and quality outcomes (an example she used was flammable cladding).

“Industry and government need to work closely together on innovation in building and construction to ensure risks are mitigated and for better quality buildings to be delivered.

“We are already seeing good progress on timber innovation, with timber mills boosting structural timber manufacturing capacity thanks to government-supported investment,” Ms Wawn said.

Industrial relations

Master Builders felt that while there were some positive steps in the Budget, the industrial relations landscape “continues to hold the industry back and stops thousands of new homes from getting built” according to Ms Wawn.

“New industrial relations laws will see at least 15,000 fewer homes, almost 8,000 fewer jobs and cost the economy over $113 billion over the next five years,” she said.

“The Budget missed an opportunity to provide adequate resources for the Fair Work Ombudsman to clean up the industry and stamp out unlawful union behaviour on construction sites.

“When the ABCC was abolished, the industry was reassured by the Federal Government that the FWO would be given the resources and support it needed to uphold workplace laws, but we have not seen that happen,” Ms Wawn said.

“Master Builders Australia now calls on the Federal Government to introduce an industry-specific regulator with real teeth to clean up increasing disruption and unlawful behaviour on construction sites which ultimately blows out construction costs and timeframes.”

Measures highlighted by Master Builders Australia in the Federal Budget

• $1 billion directed towards crisis and transitional accommodation for women and children fleeing domestic violence, and youth under the National Housing Infrastructure Facility. This includes increasing the proportion of grants for this investment from $175 million to $700 million in the Budget to be able to support crisis and transitional housing.
• $1 billion to get homes built sooner – funding for states and territories to build the roads, sewers, energy, water and community infrastructure that we need for new homes and for additional social housing supply.
• A new $9.3 billion five-year National Agreement on Social Housing and Homelessness – for states and territories to combat homelessness, provide crisis support and build and repair social housing. This includes a doubling of Commonwealth homelessness funding to $400 million every year, matched by states and territories.
• Increasing the cap on the government’s guarantee of Housing Australia’s liabilities by $2.5 billion to $10 billion with an associated increase in the line of credit that supports the Affordable Housing Bond Aggregator of $3 billion to $4 billion.
• Reimbursement for GTOs of up to $1,500 per year, per apprentice to allow them to reduce fees for those studying in the clean energy, manufacturing and construction industries.
• $55.6 million over four years to establish the Building Women’s Careers Program.
• Work with the higher education sector on new regulation to require universities to increase their supply of student accommodation for domestic and international students.
• An additional $265.1 million over four years in financial support for apprentices and their employees. Apprentices and employers in priority occupations will receive an extra $2,000 to $1,000 respectively.
• $62.4 million for additional 15,000 Fee-Free TAFE and VET places in construction over two years from 1 January 2025.
• $26.4 million for approximately 5,000 places in pre-apprenticeship programs in construction over two years from 1 January 2025.
• $1.8 million to streamline skills assessment for around 1,900 potential migrants from countries with comparable qualifications.
• Prioritise the processing of around 2,600 Trades Recognition Australia skills assessments in construction.
• $7 million to help residential builders get accredited through the Office of the Federal Safety Commissioner when applying for Housing Australia Future Fund funding.
• $6.2 million for peak industry bodies to provide support and assist residential builders in obtaining accreditation under the Federal Safety Commissioner scheme.
• 12-month extension of the $20,000 Instant Asset Write-Off for businesses with turnovers capped at $10 million.
• $19.7 million over six years to support housing research, fast-track feasibility studies on the release of Commonwealth land to support social and affordable housing.

www.masterbuilders.com.au

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BUDGET REACTION -- The Federal Budget has reinforced the urgent need to tackle the escalating costs of infrastructure nationwide or more projects will be put at risk, according to the Australian Constructors Association (ACA).

ACA CEO Jon Davies said the $10.1 billion allocated to cover cost increases on existing projects, rather than new projects, was a wake-up call.

“We can’t afford to continue with business as usual. Planning needs to be improved and construction costs need to be lowered to ensure the country can afford the infrastructure it needs,” Mr Davies said.

The Australian Government's Future Made policy could be used to dramatically lower the cost of construction by investing in modern methods of construction (MMC), he said.

“MMC has the potential to revolutionise project delivery by shifting more work to controlled factory environments. This standardised approach not only significantly boosts productivity but also mitigates site-based risks such as inclement weather, and offers safer, more flexible working environments.

“MMC also aligns seamlessly with Australia’s ambitions for net-zero emissions. 

“By reducing waste and minimising reliance on fossil fuels, MMC presents a pathway toward decarbonising the construction industry and meeting global emission targets.”

Mr Davies said the government had an important role to play in laying the groundwork for MMC adoption.

“By optimising project designs for manufacture and assembly and by standardising components of schools, hospitals, metro stations, bridges and other types of infrastructure across jurisdictions, a viable market will be created to support private sector investment in MMC manufacturing facilities. This investment could be accelerated by matched investment from State and Federal governments and by underwriting demand in the short term.

“The potential economic benefits are substantial. Closing the productivity gap between construction and other industries could boost the economy by $56 billion annually. This could fund essential services like the NDIS and build new schools and hospitals nationwide.

“Investing in MMC might not be as glamorous as quantum computing or solar farms, but it could transform Australia’s construction sector. This would ensure the country not only gets the infrastructure it needs, but when it needs it, and at a cost it can afford.”

The Australian Constructors Association is the representative body for contractors delivering vertical and horizontal construction projects, as well as undertaking infrastructure asset management. ACA’s members construct and service the majority of major infrastructure projects built in Australia every year and the organisation’s goal is to create a more sustainable construction industry.

www.constructors.com.au

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BUDGET REACTION – The 2024 Federal Budget confirmed a ‘super-sized’ investment in Australian parents through the landmark reform to pay superannuation on Government Paid Parental Leave from July 1, 2025.

This represents ‘a major stride forward’ to help close the gender super gap and deliver a financially stronger retirement for Australian women, according to the Super Members Council.

Alongside a pledge to fund anticipated pay rises for workers in highly feminised industries in childcare and aged care, the paid parental leave superannuation plan will deliver millions of Australian women more money while they are working and in retirement.

According to the Super Members Council, Women in Australia still retire with about a third less super than men, despite living longer and retiring earlier on average. Retirement savings for women in their 30s is also going backwards proportionally.

Super Members Council CEO Misha Schubert said paying super on parental leave would boost the savings of a mother-of-two by about $14,500 by retirement – with 180,000 Australian families set to benefit each year.

“The historic announcement to pay super on parental leave takes Australia another major stride closer to ending the financial motherhood penalty many women face when they have children,” Ms Schubert said. 

“It’s a watershed reform that will powerfully strengthen retirement savings for Australian mums and help to narrow the gender gap at retirement.

“The anticipated pay rises for the highly feminised early childhood education and aged care workforces are also key changes to help close the retirement savings gap for Australian women.

“These are big steps on the road to gender equity – and the government has signalled it intends to continue that work. Australia cannot rest until all women have a financially secure retirement.”

Lower rates of pay for feminised industries are a key driver of the gender super gap, Ms Schubert said.

Anticipated pay rises for Australia’s female-dominated workforces in aged care and early education – expected to flow from imminent decisions in the Fair Work Commission – will help tackle gender inequity at retirement.  

Last year’s Federal Budget announced a commitment to deliver payday super reforms from July 1, 2026. An estimated 2.8 million working people in Australia are underpaid a total of $4.7 billion a year in super. 

Ms Schubert said those reforms would require super to be paid to people’s super accounts when they are paid their wages – rather than just four times a year.

“Consultation on the design of these important reforms is ongoing,” she said.

The 2024 Federal Budget pledges $60 million over four years to boost the Productivity, Education and Training Fund – to bring employer and worker representatives together to work on measures to boost productivity – and help workplaces prepare to implement policy changes such as payday super.

Ahead of payday super commencing, the 2024 Budget includes support for new small business cashflow, with $25 million to speed payment times and $290 million in cashflow support.  

“Unpaid super costs workers $1,700 a year on average – and our modelling shows payday super reforms could add up to $36,000 to the retirement balances of the lowest 20 percent of wage earners,” Ms Schubert said.

The 2024 Budget unveils a further $6.2 billion investment in social and affordable housing, including $1 billion to help States and Territories to deliver new housing by connecting essential services such as water, power, sewerage and roads, plus 20,000 new fee-free TAFE places in building trades.

Expanding the supply of housing is urgently required to get more Australians into their own home, Ms Schubert said

“This Budget announces a $2.7 million lift over four years – and $700,000 a year ongoing – to governance of the system that transmits data on super contributions between employers and super funds,” Ms Schubert said.

The Budget also provides for a 12-month extension to freeze deeming rates for people on Government support payments – including 450,000 retirees reliant on a part aged pension.

The Super Members Council provides a strong voice advocating for more than 11 million Australians who have over $1.5 trillion in retirement savings managed by profit-to-member superannuation funds. The council’s aim is to protect and advance their members’ interests throughout their lives, advocating on their behalf to ensure superannuation policy is stable, effective, and equitable.

“We produce rigorous research and analysis and work with Parliamentarians and policy makers across the full breadth of Parliament,” Ms Schubert said.

www.smcaustralia.com

Table 1: Gender super gap by age and median balances (2020/21)

 Source: SMC analysis of the ATO 2020-21 2% sample file.

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