How the budget affects you – from Gen Z to retirees

Gen Z

The government wants to boost the number of Australians who complete apprenticeships, as completions dropped from 57,000 in 2012 to just 20,000 last year.

Younger Australians will be able to apply for one of 180,000 fee-free TAFE places from January 2023, as part of a total commitment of 480,000 places over four years targeting aged care, early education, IT, hospitality and other areas with critical skill shortages.

Younger Australians will be able to apply for one of 180,000 fee-free TAFE places.Credit:iStock

An extra 20,000 university places will also be created over the next two years for students from disadvantaged backgrounds looking to study in an area of skills shortage.

The government will also spend $203.7 million on student wellbeing, including school mental health support and social activities.

It has also created the Startup Year program, providing 2000 income-contingent loans a year to allow eligible students to participate in a university-based accelerator program in a bid to foster the next generation of Australian entrepreneurs.

Families

Parents can expect more financial support.Credit:Peter Braig

The government has poured billions into supporting families. That includes $531.6 million over the next four years to expand the Commonwealth paid parental leave program from 18 to 26 weeks – but the full six subsidised months won’t be available to new parents until 2026. The government is also spending $4.6 billion to increase childcare subsidy rates for all families with annual incomes below $530,000 up to a maximum of 90 per cent.

Treasury estimates the child care subsidy changes will increase the number of hours worked by women with young children by up to 1.4 million hours a week – the equivalent of an additional 37,000 full-time workers.

The government has also unveiled a housing agreement between all levels of government, and has set a target for one million homes built in five years to help ease the housing crunch and provide affordable housing across the country to those who need it, including women fleeing domestic violence, and essential workers.

Some families may also get assistance buying a home, including through the Regional First Home Buyer Guarantee, which will provide 10,000 places each financial year for homebuyers to get into the market with a 5 per cent deposit.

A separate Help to Buy shared equity scheme will also assist some home buyers to purchase a new or existing home with a smaller deposit.

Retirees

More retirees will have access to the Commonwealth Seniors Health Card, with the income threshold for access to be lifted from $61,284 to $90,000 for singles and from $98,054 to $144,000 (combined) for couples, at a cost of almost $70 million over four years.

There has been an extension of an existing tax break allowing one-off post-tax contributions to superannuation of up to $300,000 from the sale of family home, with the minimum eligibility age lowered from 60 to 55 years of age.

More retirees will have access to the Commonwealth Seniors Health Card.Credit:Peter Braig

Medicines will be cheaper for about 3.6 million Australians. General patient co-payment for treatments on the Pharmaceutical Benefits Scheme will be reduced from $42.50 to $30 on January 1, 2023.

Age pensioners can access a one-off $4000 credit to their work bonus income banks in 2022-23, to give older Australians the option to work and keep more of their money.

The temporary income bank credit will increase the amount pensioners can earn this financial year from $7800 to $11,800 before their pension is reduced, enabling pensioners who want to work to immediately boost the supply of labour to help meet shortages.

Those retirees in aged care facilities will benefit from new requirements for a qualified registered nurse on site 24 hours a day, seven days a week from July 1, 2023. Average care minutes will increase to 215 per resident, per day, from October 2024.

High-income earners

There are no changes in the budget to the legislated stage three personal income tax cuts, which will see the 37 per cent tax bracket abolished, the 32.5 per cent bracket reduced to 30 per cent, and the 40 per cent bracket lifted from earnings over 180,000 to earnings over 200,000 from July 2024.

Taxes on electric vehicles will be reduced to help encourage uptake. Exempting electric vehicles from fringe benefits tax and the 5 per cent import tariff will cost the government $345 million.

Taxes on electric vehicles will be reduced to help encourage uptake.

Small businesses

Small business owners will be able to access free mental health and counselling services under a $15.1 million investment in support services.

Businesses desperate for skilled workers also stand to benefit from the increase to the permanent migration cap to 195,000 for this financial year, and $42.2 million to help reduce the visa backlog. The additional TAFE and university places will also benefit businesses, with many of the spots focused on industries that have experienced skills shortages, including hospitality and teaching.

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