QLD 2024: Budget sets tone for cost-of-living election campaign

11 June 2024

Queensland’s Miles Labor Government today delivered a pre-election budget firmly aimed at giving it the best possible chance of victory in October by spending big on a range of cost-of-living measures.

The strategy comes with a significant price tag. Last year’s record surplus of $13.9 billion (the largest budget surplus of any state or territory) was reduced to an operating surplus of $564 million in the current financial year and is forecast to tumble to a deficit of $2.6 billion in 2024-25.

SEC Newgate’s most recent Mood of the Nation research found Queenslanders are feeling the greatest pinch from cost-of-living pressures, so it is no surprise the State Government has already announced a range of broad cost saving schemes, including electricity rebates, 50 cent public transport fares and car registration discounts.

In delivering Labor’s 10th budget, Treasurer Cameron Dick emphasised that the Government’s commitment to easing financial pressures for Queensland families would take precedence over maintaining a surplus. The Treasurer said, “Not only will it be the greatest cost of living budget in Queensland history, it will be the greatest cost of living budget that any state government has ever done in Australia”.

Opposition Leader David Crisafulli has already committed to honouring the Government’s budget commitments if the LNP wins October’s election, a continuation of his small target election strategy and an attempt to negate the populist appeal of Labor’s cash splash.

SEC Newgate’s budget note focuses on the headline numbers and important initiatives in the crucial election campaign battlefields of cost-of-living, health, crime, and housing.

Cost-of-Living

• Electricity Rebates: A $1,000 rebate for all households, with seniors and people in vulnerable groups receiving up to $1,372.
• Transport Subsidies: Introduction of 50 cent public transport fares and half-price Brisbane Airtrain fares.
• Car Registration Discount: A 20% discount on car registration for 12 months.
• Free Kindergarten: $645 million to provide free kindergarten from next year.
• Kids Sport Vouchers: $200 FairPlay vouchers to help kids participate in sports.

Health

• Record Health Spending: A $4.393 billion operational budget over four years, representing a 10.6% increase in operating funding.
• Ambulance Recruitment: $269.9 million to recruit 188 ambulance operatives and $30 million commitment to QAS base capital program.
• Emergency Helicopter Services: $142 million injection over four years in vital specialist retrieval and emergency helicopter services.

Crime

• Detention Capacity: $261.4 million to fund new youth workers at the youth detention centre at Woodford and $149.2 million for the Wacol Youth Remand Centre
• Increased Police: 900 additional police personnel statewide; a commitment of response helicopters to service Far North Queensland and the Wide Bay/Sunshine Coast regions.
• Victim Support: $16 million to expand the Victims of Crime community response program and $15.6 million to increase capacity of Victims Assist Queensland to process financial assistance applications.
• Domestic, Family and Sexual Violence: A 20% increase for the state-funded domestic, family and sexual violence sector.

Housing

• First Home Buyer Stamp Duty Concessions: First home buyers can now receive a $30,000 grant. The first home concession on transfer duty will now phase out at $800,000 for home purchases and $500,000 for vacant land. The foreign investor land tax surcharge will increase to 3%.
• Tackling the Housing Crisis: $3.1 billion investment to tackle housing and homelessness, with a target to build one million homes by 2046.
• Renting Support: $160 million towards a renters’ relief package.

Looking Ahead

Despite its ambitious spending plans, the Government acknowledges the financial challenges ahead. The budget projects deficits for the next two financial years before returning to a modest surplus in 2026-27. This is a reversal from previous forecasts, driven by conservative coal price assumptions and revisions in GST revenue.

The Government’s funding strategy includes maintaining the controversial coal royalty scheme, which has significantly boosted state revenue in recent years. However, Treasurer Dick has left the door open for potential tax changes targeting businesses and industry, reinforcing the Government’s stance on not increasing taxes for everyday Queenslanders.

Opposition Leader David Crisafulli and Shadow Treasurer David Janetzki will deliver the LNP’s Budget Reply speech in the Queensland Parliament on Thursday 13 June 2024.

With 137 days to go until the Queensland election on 26 October, the Government will try to use today’s budget to rein in the Opposition’s lead in the polls. Critical to its strategy will be trying to pressure a disciplined Opposition to release more detail about its plans if it wins government. Importantly from a campaigning perspective, Treasurer Dick has put aside a $184 million dollar war chest for initiatives yet to be announced.

To discuss in further detail, including what opportunities it presents for you, please contact:

Jamin Smith, Partner and Brisbane Office Head – [email protected]  |  0451 755 355

Max Dudley, Account Director – [email protected]  |  0437 924 390