State Budget
Earlier today WA Treasurer Ben Wyatt delivered his fourth State Budget within which he detailed $27 billion worth of infrastructure spending over the next four years and a $1.2 billion surplus this year.
UDIA WA welcomed the budget which includes the previously announced $600 electricity credit, the freeze on household fees and charges this year and the initiatives within the Government’s $5.5 billion WA Recovery Plan.
Also included in the budget is the extra $30 million being added into the Building Bonus scheme following the higher than anticipated demand for the incentive and $170.5 million for the Perth City Deal including $150 million to help establish inner city university campuses.
In welcoming the budget, UDIA WA CEO Tanya Steinbeck said that leveraging infrastructure investment is a key avenue for boosting economic growth and creating jobs.
However, Ms Steinbeck noted that while building stimulus measures have had a fantastic impact on the market, the development industry is hopeful that the Treasurer will consider extending the scheme timeframes as previously requested to allow industry to delivery high quality product in a safe and sustainable fashion.
For more information, click here and to view UDIA WA’s media release here.
Federal Budget
On Tuesday the Federal Government released its 2020 Budget, which has been designed to fast track Australia’s recovery from the economic effects of COVID-19 featuring tax cuts, infrastructure investment and importantly, new stimulus measures for the housing sector.
UDIA National was particularly pleased to see initiatives consistent with our advocacy priorities – including revisions to the First Home Loan Deposit Scheme designed to boost new housing construction.
Key statistics from this year’s budget include:
- The Budget Deficit is forecast to be $213 billion in 2020-21 – with total net debt to rise to $966 billion by 2023-24
- Net Overseas Migration is forecast to remain in negative for the next two years – contracting by 71,600 this year and another 21,600 in 2021-22, before returning to more normal numbers in 2023-24. The total Australian population is expected to contract by 0.4% by 2021-22.
- Dwelling investment fell by 7% in 2019-20, will fall by a further 11% in 2020-21 and then recover to a growth of 7% in 2021-22
Among the key initiatives impacting the development industry, the announcement of 10,000 additional places made available on the First Home Loan Deposit Scheme was most noteworthy.
In addition the Federal Government have committed to lifting the cap on the price of housing under this tranche of the scheme which means the cap in Perth or a regional centre is now $550,000, up from $400,000 and across the rest of the State the new cap is $400,000, up from $300,000.
UDIA National believes the initiative is a major plus for the sector. In addition to this support, UDIA will also be continuing our advocacy to see the HomeBuilder initiative expanded and redesigned before its current expiry on December 31 this year. This is an important element for the overall industry targeting non first homebuyers which make up most of the purchase activity in the housing market.
For more information, read UDIA’s media statement here or see the Federal Budget in detail here.
UDIA WA AGM next week
The UDIA WA AGM will be held next Wednesday 14 October at 2pm at the UDIA WA offices, followed immediately after by the UDIA WA State Council meeting.
This AGM will be the last one with Alf Lay serving as Treasurer as after a decade on the Council Alf will be stepping down. We would like to extend our sincere gratitude to Alf for his dedication and service to the UDIA WA Council.
Any members not able to attend this year’s AGM are invited to complete a proxy form on their behalf to ensure their voice is heard in their absence.
For more information or to obtain a proxy form, contact udia@udiawa.com.au.
We look forward to seeing many of our members on Wednesday.
Environmental regulations discussed over breakfast
Yesterday morning UDIA WA hosted our Future Proofing the Urban Environment Breakfast featuring Darren Walsh and Tom Hatton sharing their insightful knowledge around the potential impacts of future environmental regulation.
UDIA WA has long advocated for a more streamlined approach to environmental approvals as we recognise the impact of climate change, and the increasing interest of the community in ensuring that our future is sustainable and sensitively developed for future generations.
The current review of the EPBC Act and the intent by both the Federal and State Government to enter into a bilateral agreement provides a promising platform for positive change – however could easily result in a more costly outcome for development if not well designed.
This breakfast provided a timely and valuable discussion with key environmental commentators and we would like to thank Darren and Tom for their time. Also a big thank you to our Environmental Partner Strategen-JBS&G for sponsoring the event.
To see pictures from the event, click here.
Cash rate kept steady until November
Ahead of the Federal Budget announcement on Tuesday, the Reserve Bank of Australia (RBA) chose to retain the official cash rate at 0.25% for another month.
In a statement following the decision RBA Governor Philip Lowe said the global economy is gradually recovering after a severe contraction due to the pandemic. However, the recovery is uneven and its continuation is dependent on containment of the virus.
He said with the exception of Victoria economic recovery was underway across the country but it will be some time before the level of output returns to its end 2019 level.
Regarding the RBA’s current policy package he said it is working largely as expected and is underpinning very low borrowing costs and the supply of credit to households and businesses.
In closing Dr Lowe said the RBA Board is committed to do what it can to support jobs, incomes and businesses in Australia and addressing the high rate of unemployment remains an important national priority. The Board will maintain highly accommodative policy settings as long as is required and will not increase the cash rate target until progress is being made towards full employment and it is confident that inflation will be sustainably within the 2–3 per cent target band.
The Board will continue to consider how additional monetary easing could support jobs as the economy opens up further.
WA households to receive electricity credit
Within the 2020 State Budget is the confirmation that every WA household will receive a $600 electricity credit to be applied from 1 November 2020.
Around 1.1 million Synergy and Horizon Power customers will receive the one off credit, which is expected to provide the average WA household around four months of relief from having to pay their electricity accounts.
The credit has been funded from the recent Bell Group settlement for losses incurred in the Bell Group collapse in the early 1990s.
The $600 electricity credit will see $644 million delivered back into the pockets of Western Australian households designed to provide a significant boost to the local economy.
With the $600 credit, the average Western Australian household can expect a total saving of $663.52, or a one-off reduction of 10.4% on their household fees and charges this year.
Free training linked to hundreds of construction job opportunities
Yesterday the State Government partnered with industry to launch the Infrastructure Ready TAFE program designed to increase opportunities for jobseekers to be part of Western Australia’s transport infrastructure boom.
Eligible participants will take part in a free four-week intensive training course at TAFE campuses across metropolitan Perth while also gaining an inside look at some of WA’s key construction projects including:
- METRONET Bellevue Railcar facility;
- METRONET Yanchep Rail Extension;
- METRONET Thornlie-Cockburn Link;
- METRONET Denny Avenue Level Rail Crossing Removal;
- Armadale to North Lake Road Bridge Project;
- Karel Avenue Upgrade Project;
- High Street Fremantle Upgrade Project; and
- Roe Highway/Kalamunda Road Interchange Project.
The program aims to increase industry diversity, with young and female jobseekers encouraged to apply. The course forms part of the Recovery Skill Sets initiative, which is free for those people on JobSeeker/JobKeeper payments, or are concession-eligible or aged under 25. Non-eligible participants will need to pay a $191 fee.
It is also an opportunity for mature age jobseekers recently displaced from other industries to enter the civil construction industry, which will be enjoying a sustained pipeline of work on fully-funded projects over coming years.
The Infrastructure Ready Skill Set will teach basic measurement and calculation skills relevant to construction and focus on safe work practices. Participants will also learn skills to operate small plant and equipment used on construction projects.
The training program will begin in late October with the first round of ‘job-ready’ participants given the opportunity to gain entry-level prospects with contractors from the civil construction industry by early 2021 and is supported by a four week TAFE course.
The program is part of a wider initiative designed to drive the sustainability of the civil construction industry by developing an ongoing pool of entry-level workers.
Contractors will be provided with incentives to employ and retain program participants.
Key industry partners include the Civil Contractors Federation, the Construction Contractors Association and the Construction Training Fund.
People interested in signing up to the course can register their interest by emailing irp@dtwd.wa.gov.au
Latest episode of The Urbanist Live featuring Paige Walker
Last week UDIA WA released the fifth episode in The Urbanist Live podcast series showcasing UDIA WA CEO Tanya Steinbeck speaking to Mirvac General Manager Residential Development WA Paige Walker.
In this episode Tanya and Paige discuss a variety of topics including innovation, diversity, the state of the current apartment market and the impact of the recently finalised Perth City Deal as well as providing an insight into Paige’s career journey.
Our thanks go to Paige for providing us with the opportunity to share her extremely useful thoughts through our podcast.
Listen to the fifth episode here.
Paige was also recently featured on the front cover of The Urbanist magazine, as part of an article that focuses on innovation and the importance of implementing a culture of innovation in your organisation.
For more information, click here.
August sees resurgence in job vacancies
For the 3 months to August 2020 national job vacancies were 208,000, an increase of 67.07% QoQ (-8.09% YoY) – reflecting the dramatic drop over the 3 months to May 2020.
Nationally, mining vacancies increased 30.23% QoQ to 5,600 (-12.50% YoY); manufacturing vacancies increased 92.86% QoQ to 13,500 (+16.38% YoY); construction vacancies increased 91.57% QoQ to 15,900 (+6.71% YoY), and real estate vacancies increased 260.00% QoQ to 3,600 (-12.20% YoY).
In WA, job vacancies increased 91.67% QoQ to 32,200 (+21.97% YoY).
WA building approvals on the up but struggling nationally
Across WA the total number of new residential dwelling units approved in August numbered 1,168 representing a 15.38% increase MoM (-16.53% YoY), with the value of new residential dwelling units approved totaling $350,307,000 (+8.40% MoM, -30.02% YoY).
The total number of new houses numbered 1054 (+17.48% MoM, +33.55% YoY), the total number of semidetached dwellings numbered 29 (+62.50% MoM, -58.73% YoY), and the number of new apartments numbered 86 (-21.52% MoM, -89.42% YoY).
Nationally, the total number of new residential dwelling units approved numbered 13,896 representing a -9.73% decrease MoM (-1.42% YoY), with the total number of new houses totaling 9635 (-3.01% MoM, +8.36% YoY).
The value of new residential building jobs totaled $4.74 billion (-6.84% MoM, +1.91% YoY)
Retail Trade down in August
For the month of August, following an increase of 3.2% in July and an increase of 2.7% in June 2020, the seasonally adjusted estimate for national retail turnover decreased 4.0% (+7.1% YoY), largely driven by a 12.6% decrease in Victorian retail trade, and -2% in NSW.
In WA, the seasonally adjusted estimate decreased -0.4%. The only 2 states to experience growth were the NT (+2% MoM) and the ACT (+0.7% MoM).
In original terms WA retail trade decreased -1.5% MoM (+16.2% YoY).
UDIA requests for feedback
UDIA is working on submissions and responses in relation to the following. Members are encouraged to provide feedback and comments to inform our submissions to policy@udiawa.com.au by the specified dates below:
WAPC Draft Operational Policy 2.4 – Planning for School Sites (here), closes 5pm 19 October – review has been an opportunity to improve strategic school site planning, address known issues on locational and physical site requirements for schools, and provide clarity and transparency on the methodology and application of developer contributions for public primary schools.
To review the discussion paper ‘Waste not, want not – Valuing waste as a resource – Proposed legislative framework for waste-derived materials’ and for information about submissions, visit here.
Site Security Update
September has continued to see reduced crime across the industry with a total of 18 crime reports, and 15 illegal rubbish dumping reports.
Of these, 24 reports were from builders, eight from land developers and one from civil contracting. More information can be found here.
With several factors currently impacting reduced crime trends, the possible easing of COVID-19 restrictions may see an upward trend in the coming months.
Ensure you support the building and construction industry in our efforts to reduce crime and illegal rubbish dumping, more information here.