What's in the budget for sparkies?

Tuesday night's Federal Budget has included several positive policies and announcements that will drive economic activity for the electrical contracting sector. 

Below, MEA has unpacked these announcements to help demystify them and unpack what they mean for the electrical contracting industry. 

Housing

MEA has welcomed initiatives to support increased building activity. Especially regarding the rental accommodation shortage with $7.5b available for social and affordable housing projects.

The budget has also promised to expand eligibility for the Home Guarantee Scheme those who have not owned a property in Australia in the last 10 years.

The effect of these measures will be to support demand for construction in the building sector even if higher interest rates lead to a slowing down in other parts of market. This will help ensure Master Electricians working in the residential housing market will have a pipeline of work.

Energy policy

The budget includes initiatives that will create work for electrical contractors. This includes the already announced Electric Vehicle Strategy and the investments in energy infrastructure.

New policies include:

• The Small Business Energy Incentive will encourage businesses to invest in energy efficient heating and cooling, batteries, and other energy efficient appliances. With business turning over less than $50m have access to a 20 per cent tax deduction on eligible assets up to $100,000.
• The Household Energy Upgrade Fund that has $1.3b of funding for householders to make energy saving investments in their own homes.
• Changes to the investment trust withholding tax concessions for the construction of energy efficient commercial buildings such as warehouses and data centres, any buildings commenced after budget night will be eligible.
• The Energy Price Plan Relief will provide more than 1 million eligible small businesses with direct bill relief.

These plans aim to help increase the uptake in electrification and may directly benefit contractor businesses. 

Small business support measures

The main elements of the Instant Asset Write-off concessions have been retained. Up to $20,000 write-off available for small businesses from 1 July 2023 till 30 June 2024.

The government has also moved to alleviate cash flow pressures by halving the increase in quarterly tax instalments for GST and Income Tax from 12 per cent to six per cent.

Cyber security for small businesses has been boosted with millions to be spent on training in-house cyber wardens to build small business resilience and help mitigate and reduce harms associated with attacks on business.

Skills support

The electrical contracting sector is feeling the pressures being caused by skills shortages. The budget has included some positive announcements in to fund increased training.

A further 300,000 TAFE and vocational education training places will become fee-free. The government has responded to industry’s concerns with Apprenticeship Support Services and have committed to redesigning the network.

The new model will look at individual assessments to support success and have a stated goal of increasing completions, with an emphasis on mentoring.

There are initiatives that broadly support increased apprenticeship uptake and completion, including specific pathways for women, Indigenous Australians and other cohorts currently underrepresented in the electrical industry.

As part of the overall review of the migration system in Australia, there is some targeted initiatives and funding for pilots to boost skilled migration and streamline skills recognition of qualifications from other national jurisdictions. MEA is committed to a strong and safe licensing system and would support changes to the system to speed up the recognition of qualifications along as safety and quality is not compromised.

Could more have been done?

MEA will continue to advocate for a more integrated Distributed Energy Resources landscape, that incentivises the average Australian to be part of the energy transition in concrete ways like utilising the take up of EV’s in concert with tariffs that preference bi-directional charging enabled vehicles.

MEA would also like to see a shift in our school system to lift the status of VET pathways to equal that of the ATAR/tertiary stream to encourage young Australians to take up a career in the electrical industry.