Investing in the essential services Australians rely on

The Government is guaranteeing the essential services that Australians rely on, now and into the future.

A stronger economy has enabled the Government to deliver record investment in Medicare, hospitals, schools and disability services.

This means Australians have guaranteed access to high‑quality hospitals and schools, a strong Medicare system and vital services for those with permanent and significant disability.

The Government is providing more choice for older Australians to live healthier, more independent and safer lives, so they can take advantage of the opportunities that a longer life brings.

The Government’s record investment in schools will give teachers the tools to lift the performance of our students and prepare them for the jobs of the future.

The Government supports the recommendations of the Review to Achieve Educational Excellence in Australian Schools and will work with states and territories to ensure student outcomes are lifted.

From 2 July 2018, the Government will ease cost of living pressures for nearly one million Australian families by implementing the New Child Care Package.

Commonwealth health funding will reach a record $78.8 billion in 2018‑19. Record levels of funding will be provided for public hospital services while funding for the Medicare Benefits Schedule and Pharmaceutical Benefits Scheme is guaranteed through the Medicare Guarantee Fund announced in last year’s Budget.

The Government is committed to building sustainable regional communities with access to high quality healthcare, education and housing.

This includes delivering on the recommendations of the Independent Review into Regional, Rural and Remote Education by supporting more regional students to access tertiary education; improving the delivery of healthcare through the Stronger Rural Health Strategy; and alleviating overcrowding in remote Indigenous communities through a new agreement for remote housing with the Northern Territory Government.

Australians living with permanent and significant disability will have certainty that they can exercise choice and control over the services they need through the fully-funded National Disability Insurance Scheme.

The Government will continue to support those who selflessly serve our nation and protect our interests overseas, and their families, when they come home.

Measures to unlock the supply of affordable housing remain on track, including the establishment of the $1 billion National Housing Finance and Investment Corporation and the release of more land suitable for housing.

The Government is continuing to take action to address energy price pressures. The National Energy Guarantee will see $400 off the average Australian household’s annual power bill and places a focus on the affordability, reliability and sustainability of our energy supply.

The Government will maintain pressure on big energy companies to give Australians a better deal on their gas and electricity prices.

There is no more important essential service than keeping Australia safe. The Australian Government continues to place a high priority on protecting Australians from the threat of terrorism and is giving our defence forces what they need to do their job. This Budget includes significant funding to: enhance Australia’s aviation, air cargo and international mail security; continue Operation Sovereign Borders; and strengthen national police and security agencies.

Health services

Guaranteeing essential health services

Guaranteeing Medicare and providing record health funding

The Government’s strong budget management and plan for a stronger economy is ensuring continued record investment in health care for Australians.

Health funding is expected to increase from $78.8 billion in 2018‑19 to $85 billion in 2021‑22, ensuring the delivery of the essential medical, pharmaceutical and hospital services Australians rely on.

Investing in public hospital services

This Budget fully funds a new five‑year public hospital agreement with the states and territories that will deliver more than $30 billion in additional funding between 2020‑21 and 2024‑25 — a 30 per cent increase over the previous five years.

Commonwealth funding to Australia’s public hospitals is on track to more than double from $13.3 billion in 2012‑13 to $28.7 billion in 2024‑25.

Guaranteeing Medicare

The Government has guaranteed funding for the Medicare Benefits Schedule (MBS) and the Pharmaceutical Benefits Scheme (PBS) through the Medicare Guarantee Fund, as announced in last year’s Budget.

For 2017‑18, $34.4 billion has been credited to the Fund. A further credit of $35.3 billion will be made to meet estimated MBS and PBS expenditure for 2018‑19.

This Budget includes new and amended items on the MBS, including cystic fibrosis testing, 3D breast screening and MRI tests for prostate cancer.

Bulk billing for GP visits in Australia remains at record levels with 84.3 per cent of GP visits in 2016‑17 being bulk billed, or 3 million more visits than the previous year.

Greater access to medicines

This Budget includes $1.4 billion for new and amended listings on the PBS, including medicines to treat spinal muscular atrophy, breast cancer, relapsing‑remitting multiple sclerosis and a new medicine to prevent HIV.

Record hospitals funding

This chart shows that funding for public hospitals will increase from nearly $14 billion in 2013-14 to nearly $29 billion by 2024-25. In 2013-14 public hospitals funding is about $13.8 billion. In 2014-15 public hospitals funding is about $15.5 billion. In 2015-16 public hospitals funding is about $17.2 billion. In 2016-17 public hospitals funding is about $18.6 billion. In 2017-18 public hospitals funding is about $20.7 billion. In 2018-19 public hospitals funding is about $21.2 billion. In 2019-20 public hospitals funding is about $22.3 billion. In 2020-21 public hospitals funding is about $23.5 billion. In 2021-22 public hospitals funding is about $24.7 billion. In 2022-23 public hospitals funding is about $26.0 billion. In 2023-24 public hospitals funding is about $27.3 billion. And in 2024-25 public hospitals funding is about $28.7 billion.

Record Medicare funding

This chart shows that funding for medical benefits will increase from $23.3 billion in 2017-18 to $28.2 billion in 2021-22. In 2017-18 funding for medical benefits is about $23.3 billion. In 2018-19 funding for medical benefits is about $24.1 billion. In 2019-20 funding for medical benefits is about $25.5 billion. In 2020-21 funding for medical benefits is about $26.8 billion. In 2021-22 funding for medical benefits is about $28.2 billion.

For more information visit the Guaranteeing the essentials section

Education and child care

Supporting working families and giving children the right start

Investing in our teachers and schools

Equipping students to grow and succeed

Legislated, fairer funding for schools

The Government’s legislated needs‑based funding for schools delivers an additional $24.5 billion for Australian schools over the next 10 years ‑ that is a 50 per cent increase in per-student funding, on average, over a decade.

By supporting the recommendations of the Review to Achieve Educational Excellence in Australian Schools led by David Gonski AC, the Government is ensuring that this genuine needs-based schools funding is delivering the best outcomes for Australian students.

The Government has given in-principle support to the 23 recommendations of this landmark review, setting out a clear plan for the future. The Government will work with the states and territories to deliver reforms in the Review’s key areas:

  • reforming the curriculum to deliver at least one year’s growth in learning in every student every year;
  • online progression and learning tools for teachers; and
  • better supporting teachers and parents to help students achieve their individual best.

For the first time, a national blueprint will be available for every government, every teacher and every family to help tackle declining school performance in Australia. This will ensure the Australian Government’s record levels of schools funding under the Quality Schools Package will be invested in maximising outcomes for Australian students.

Those students with the greatest need will continue to receive the highest level of funding from the Government.

National Schools Chaplaincy Programme

The Government is providing permanent funding for the National Schools Chaplaincy Programme, providing an additional $247 million over four years from 2018‑19.

The Programme supports the wellbeing of students through the provision of pastoral care services and strategies that support the wellbeing of the broader school community. The renewed Programme will have an enhanced focus on addressing bullying in schools.

The Programme assists more than 3,000 schools to engage the services of a school chaplain.

Investing in preschools and child care

Supporting working families and giving children the right start

Universal access to preschool

The Government will support access to preschool education through a $440 million investment to extend the National Partnership Agreement on Universal Access to Early Childhood Education until the end of 2019.

More than 348,000 young Australians will have access to 15 hours a week of quality early learning in the year before school.

Together with the funding extension provided in the 2017‑18 Budget, this takes total Australian Government preschool funding to around $870 million for the 2018 and 2019 school years.

Delivering affordable, accessible child care

From 2 July 2018, the Government’s New Child Care Package will come into effect, providing more support for families who need it the most.

The Government is delivering on its commitment to ease household budget pressures for nearly one million Australian families by providing more affordable access to child care.

Families on incomes of around $187,000 or less a year will not have an annual limit on the amount of Child Care Subsidy they receive ‑ that is more than 85 per cent of families with children in child care.

The Child Care Safety Net supports children from rural and regional areas and those from disadvantaged backgrounds or with additional needs to access early childhood education and care services, ensuring these families receive the support they need.

The Government is also ensuring that families face lower out-of-pocket expenses by reducing the Child Care Subsidy withholding rate to 5 per cent for all families.

For more information visit the Guaranteeing the essentials section

Preparing for the future

More choices for a longer life

Australians are now expected to live 10 years longer than they were 50 years ago, with our life expectancy now the fifth highest in the OECD. A longer life presents different opportunities for different people. The Government is acting to support Australians to be prepared to live a healthy, independent, connected and safe life.

Getting ready

Early planning can boost workforce participation, reduce chronic health problems and increase income in retirement, so Australians can get the most out of their longer lives.

 

45 and 65 Year Checks

Assisting Australians to make informed choices on how to live life to the full

  Finances for a longer life

The 2018‑19 Budget delivers measures to boost living standards and expand retirement income options to give retirees confidence in their financial security.

The Government is increasing the Pension Work Bonus to allow age pensioners to earn an extra $50 per fortnight without reducing their pension.

The Pension Loan Scheme will be expanded giving greater flexibility to use home equity to boost retirement incomes, e.g. up to $17,787 a year for a full rate age pensioner (couple).

  Jobs and skills

The Government is helping Australians to work for as long as they want, laying the foundations for a secure retirement.

The Government will provide up to $10,000 in Restart wage subsidies for employing Australians aged 50 and over.

The Skills and Training incentive will provide up to $2,000 to fund up‑skilling opportunities for mature aged workers identified as being at risk.

  Supporting choice and a healthy long life

The Government is supporting Australians to live healthier and longer lives, and to choose how they receive care.

The Government is increasing funding for home care, to support Australians to better access their choice of care, with 14,000 additional high level home care packages by 2021‑22.

The Government is investing in the physical health of older Australians through new funding to boost their physical activity and help them stay connected.

  Safeguarding quality and rights

The Government will strengthen the regulation of aged care services to respect and protect older Australians.

The Government will establish a new independent Aged Care Quality and Safety Commission and regulatory settings will be strengthened and made more transparent.

Funding is being provided to protect older Australians from abuse, including funding trials of specialist elder support services, and the Government will work with the states and territories to develop an online national register for enduring powers of attorney.

For more information visit the Guaranteeing the essentials section

Lower, fairer and simpler taxes

 Lower, fairer and simpler taxes

Rewarding effort, fostering aspiration and helping those in need

Our tax system must be fair for all Australians, one that rewards effort and fosters aspiration.

To build a strong economy, it is vital that workers are rewarded rather than penalised for their effort by our tax system.

Given personal income tax accounts for over half of the Government's tax revenue, it is imperative to get the settings right and build a better tax system while being fiscally responsible.

The tax burden borne by workers has continued to rise. Bracket creep reduces the rewards for effort, undermines the returns to quality education, and blunts the incentive to work hard, take risks, and succeed.

There were 2.4 million Australians with taxable incomes above $87,000 in 2015-16, representing 23 per cent of taxpayers, but paying 65 per cent of personal income tax.

The Government's seven-year Personal Income Tax Plan will improve incentives to strive for success.

Step one: provide tax relief to low and middle income earners to help with cost of living pressures.

Step two: combat bracket creep.

Step three: simplify and flatten the system by removing the 37 per cent tax bracket completely, protecting middle income Australians from bracket creep over their working life.

The plan delivers a tax system that encourages aspirational Australians to get ahead. Individuals will be able to take on additional work and seek advancement, knowing their extra income will not be taxed more harshly.

Number of Australians receiving tax relief in step one

Alt text.

Source: OECD Revenue Statistics and Treasury (May 2018)
Note: All listed rates are combined central and provincial government company tax rates (inclusive of surcharges).
All listed rates are current as of 1 May 2018.

By 2024-25 around 94 per cent of taxpayers are projected to face a marginal tax rate of 32.5 per cent or less compared with 63 per cent if we leave the system unchanged

The plan is affordable and funded and will be made law to give Australians certainty about their future tax relief, now.

Together our reforms to company taxes, tax integrity and personal income taxes build a simpler tax system, reward hard working Australians and drive a stronger economy.

 

The Government’s seven–year Personal Income Tax Plan means more Australians will face lower rates of tax.

 

Proportion of taxpayers in each tax bracket in 2017‒18 under the current system

Proportion of taxpayers in each tax bracket in 2024‒25 under the current system

Proportion of taxpayers in each tax bracket in 2024‒25 under the Government’s Plan

* Average full–time earnings includes both males and females, and excludes earnings from overtime work

Tax Relief Calculator
For more information visit the Stronger growth section

Jobs growth

More jobs and stronger wage growth are expected

The Government’s economic plan has delivered a record number of new jobs for Australians.

More than 1,000 jobs have been created every day on average over the past year, according to the Australian Bureau of Statistics. There were around 415,000 new jobs created in 2017, of which around three quarters were full-time.

The 16 consecutive months of net job creation to January 2018 was the longest positive run since official statistics began. In less than five years, almost a million jobs have been created under a Coalition Government.

Jobs growth has been broad-based across regions and industries, with the improved employment prospects encouraging more Australians to look for work.

This strength in the economy and jobs market is expected to continue, in line with leading indicators of employment growth such as job advertisements and business survey measures of hiring intentions.

Consistent with continuing jobs growth, the unemployment rate is forecast to decline further and, as the labour market tightens, wage growth is expected to increase.

However, this renewed strength in our economy cannot be taken for granted.

We are sticking to our plan for a stronger economy because it is only through a stronger economy that more jobs and opportunities are created for Australians.

A stronger economy also supports a stronger Budget, which guarantees funding for essential services, supports lower taxes and allows the Government to build new infrastructure across Australia.

Source: ABS cat. no. 6202.0.
Note: Over the year to December.

Making Australian businesses more competitive

Empowering businesses to grow, invest and support a stronger economy

Lower taxes to support growth

Lower taxes help Australian businesses to invest, grow, create more jobs, pay their workers more and remain competitive in a global economy.

The Government has already delivered tax relief for 3.3 million small and medium sized businesses, employing 6.8 million workers, under its Ten Year Enterprise Tax Plan which is delivering investment and creating jobs. And it remains committed to extending the tax cuts to all businesses.

Building a smart economy by investing in science and technology

The Government is investing around $2.4 billion to boost Australia’s public technology infrastructure, including supercomputers, world class satellite imagery, a national space agency, research into artificial intelligence and more accurate GPS.

This investment supports businesses to grow and employ more Australians in a smarter economy.

Delivering major transport infrastructure

This Budget includes $24.5 billion in new projects and initiatives that benefit every State and Territory. These form part of the Government’s $75 billion transport infrastructure investment over the next decade.

This investment in road, rail and public transport projects will bust congestion, boost productivity and improve safety.

A world health industry leader

A new 21st century Medical Industry Growth Plan will deliver $1.3 billion to fund revolutionary genomic research projects investigating medicines that can be tailored to individual patients, clinical trials of new drugs and development of new medical technologies.

This will ensure Australia remains a global leader in medical technology, biotechnology and pharmaceuticals while improving the health of Australians by investing in medical research.

Securing access to export markets

The Government has secured landmark export deals that will allow Australian businesses to access new markets. The Government has signed export trade deals with China, South Korea and Japan and has also signed on to the Trans-Pacific Partnership (TPP-11).

Backing our farmers

The Government is backing our farmers by enhancing water infrastructure, upgrading GPS capabilities for regional Australians and increasing funding to manage and protect against pests, weeds and disease. The Government will also fund additional agricultural trade experts to help farmers export Australian products to the world.

For more information visit the Stronger growth section

Secure, reliable and affordable energy

Affordable, reliable and sustainable energy

Reducing electricity bills for households and businesses

The Government is taking action to reduce energy costs for Australian families and businesses. The National Energy Guarantee will see a $400 reduction to the average Australian household’s annual power bill, placing a focus on affordability and reliability, while meeting our emissions targets.

The Guarantee will also provide much needed certainty in energy markets, ensuring the lights stay on and businesses have the certainty to invest. The Guarantee will deliver affordable and reliable energy for households and businesses, without relying on subsidies, taxes, emissions trading schemes or carbon prices. Greater certainty and a technology‑neutral framework will lead to lower energy bills. The estimated savings generated by the Guarantee have been modelled by the independent Energy Security Board.

Helping consumers

Over the past year, the Government has also progressed a range of other initiatives to lower prices and help consumers access better deals. In August 2017 the Government secured agreement from major electricity retailers to make sure Australians get the best deal on their electricity bills.

Retailers have since contacted approximately 1.6 million customers to inform them of better deals. Already, 180,000 customers have moved to a better deal, saving potentially hundreds of dollars each year. The Limited Merits Review regime, which allowed electricity network businesses to appeal regulatory pricing decisions and charge more for electricity, has been abolished, limiting future network price increases on consumers’ bills.

The Government is also helping customers find the best deal and better manage their energy use through the creation of a Consumer Data Right for energy. Being able to share their data safely with comparison services or alternative energy suppliers will make it easier for consumers to get the best deal, including by switching providers. This builds on $8.1 million previously provided to enhance the Government’s Energy Made Easy price comparison website. Since 1 July 2017, there have been more than one million visits to Energy Made Easy.

The Government has also directed the ACCC to investigate the electricity and gas market, to identify any further steps that can be taken to promote competition and lower prices.

Government action

  • National Energy Guarantee to deliver reliable and sustainable energy and lower prices
  • Electricity retailers have committed to help customers get a better deal
  • Consumer Data Right to enable new services that find the best deal for the consumer
  • ACCC investigating competition in the electricity market
  • Snowy Hydro 2.0 could power 500,000 homes for a week
  • Gas exporters have agreed to make more gas available to domestic users
  • ACCC is monitoring the gas market
  • Promoting gas supply and improving the functioning of gas markets
For more information visit the Stronger growth section

Securing Australia

Keeping Australians safe

At home and on our border

Australia is facing complex and rapidly‑evolving security challenges. The Government is committed to making the necessary investments that will guarantee the safety of all Australians, while supporting the free movement of people and goods.

Maintaining strong borders

Under Operation Sovereign Borders, the Government has halted the people smugglers, ended the deaths at sea and removed all children from detention. The Government is investing $62.2 million to maintain Australian Border Force Cutter Ocean Shield at surge capacity, and provide ongoing investment in international engagement activities to prevent and disrupt people smuggling.

Strengthening aviation security

The Government is investing $294 million to strengthen aviation, air cargo and international mail security, including:

  • $50.1 million to enhance security arrangements at 64 regional airports with new and upgraded screening technologies and associated infrastructure;
  • $122 million to enhance screening capability for inbound air cargo and international mail with new and upgraded equipment and advanced technology; and
  • $122 million to increase the presence and specialty capabilities of the Australian Federal Police and Australian Border Force at nine major domestic and international airports.

Investing in national security agencies

The Government is committed to ensuring that our national security agencies have the resources to keep Australia secure. This Budget will provide:

  • more than $37 million to support our federal police and security agencies fight crime and terrorism;
  • $68.6 million to establish the Australian Centre to Counter Child Exploitation;
  • $59.1 million to create the National Criminal Intelligence System, which will provide a national repository of criminal intelligence and information; and
  • $130 million to upgrade Visa systems to improve screening of arrivals.

Protecting Australia

Backing our defence forces

The Government continues to give our defence forces what they need to defend our values and keep the Australian community safe.

Increasingly complex threats to Australia’s regional security mean that growing demands are placed on the Australian Defence Force. The Government is meeting these challenges by implementing strategies in the Defence White Paper 2016.

Investing in Defence

The Government remains committed to providing a stable and sustainable funding growth path for Defence by delivering on its commitment to restore Defence funding to 2 per cent of GDP by 2020‑21.

This Budget will provide Defence with $36.4 billion in 2018‑19 and $161 billion over the next four years.

The Defence Integrated Investment Program allocates $200 billion over the next decade, which will bolster Defence force capability through programs such as the:

  • Land 400 Project, which invests $5.2 billion in 211 Boxer Combat Reconnaissance Vehicles (CRV). The Boxer CRV offers superior combat power, contributing to successful missions and the safety of our Defence force personnel.
  • Future Submarine Program and continuous shipbuilding plan that is contributing to an Australian Naval shipbuilding workforce that is expected to peak at over 5,000 by the late 2020s.

Growing the defence industry

The Government is growing a defence industry that creates jobs and drives economic growth. We have released Australia’s first Defence Industrial Capability Plan, investing $17 million annually to support Australian small and medium enterprises engaging with the Plan.

The Defence Export Strategy will build a stronger, more sustainable and globally competitive defence industry by investing $20 million annually to support Australia’s defence exports.

Ensuring regional security

This Budget will provide $766 million in 2018‑19 for Defence to continue to fight terrorist networks and protect Australia’s borders and offshore maritime interests. Over 2,300 personnel are deployed to major operations, including in Afghanistan and Iraq, fulfilling the Government’s commitment to global security and stability.

For more information visit the Guaranteeing the essentials section

Building Australia

Building Australia

A 10 year national infrastructure plan to reduce congestion, improve safety and create jobs

Major projects underway

National projects

  • $9.3 billion Melbourne to Brisbane Inland Rail

NSW

  • Up to $5.3 billion Western Sydney Airport
  • $1.5 billion of funding and a $2 billion concessional loan for the WestConnex project in Sydney
  • $2.9 billion Western Sydney Infrastructure Plan

VIC

  • $500 million M80 Ring Road
  • $500 million Monash Freeway Upgrade

QLD

  • $6.7 billion Bruce Highway

WA

  • $1.3 billion METRONET, including $490 million for the Forrestfield Airport Link

SA

  • $1.6 billion Adelaide North-South Corridor

TAS

  • $400 million Midland Highway

ACT

  • $67 million for Capital Metro under the Asset Recycling Initiative

NT

  • $192 million for the Northern Australia Roads Program

New national initiatives

  • Roads of Strategic Importance:
    $3.5 billion, including $1.5 billion for Northern Australia Package, $400 million for Tasmanian Roads Package, $100 million for NSW and ACT Barton Highway Corridor Package and $1.5 billion for future national priorities
  • $1 billion Urban Congestion Fund
  • $250 million for Major Project Business Case Fund

Backing regional Australia

Creating jobs in the regions

Regional Australia is home to more than 8 million Australians and is a major producer of our nation’s wealth. While many regions have experienced significant jobs growth, others still face challenges. The Government is committed to supporting regional Australia and ensuring the benefits of economic growth are spread broadly across the nation.

Backing our farmers

The Government is backing farmers by improving water infrastructure and the accuracy of GPS for regional Australians and increasing access to a broader range of agricultural and veterinary chemicals.

New funding of $102 million for biosecurity and $26.6 million to better manage costly pests and weeds will help farmers maintain access to valuable export markets.

Supporting regional tourism

The World Heritage-listed Great Barrier Reef supports 64,000 jobs and many small businesses in regional Australia.

The Government is investing more than $500 million to secure the future of the Reef and the jobs it supports, including through improving water quality, combating crown-of-thorns starfish and conducting scientific research.

Supporting regional communities

The Government is providing $200 million for a third round of the Building Better Regions Fund, which supports regional infrastructure and community investments. This is in addition to the Regional Growth Fund, which is investing $272 million in larger regional infrastructure projects that support long-term economic growth and create jobs in regions undergoing structural adjustment.

For more information visit the Stronger growth section