Federal Budget, Inflation, Workforce & IR Omnibus Bill

On Tuesday this week the new Federal Labor Government released its 2022/23 budget. The budget outlined a national economic picture which will continue to grow throughout the period up to 2025-26, although the pace of growth will slow to 1.5% during 2023-24 before picking up.

One of the biggest takeaways from the Budget speech is the announcement of a new National Housing Accord, which was struck between government, investors and industry (including MBA Australia). The Accord’s main goal is to create 1 million new homes over the five-year period starting in 2024. By signing up to the Accord, state, territory and local governments have committed to expedite zoning, planning and land release in a way which lowers the hurdles in the way of new housing supply, a high priority MBA advocacy issue.

The Federal budget contained new spending for Light Rail and various small infrastructure projects, however federal funding was also cancelled for other local infrastructure projects.

On Thursday the Government tabled its IR Omnibus Bill. The Bill contains 23 separate matters including the abolition of the ABCC and a number of new enterprise bargaining streams. The MBA urges caution to the Government to consider the inflationary impacts and added cost layers to businesses in the industry. At a time where builders and small sub-contractors are already struggling with a long list of economic pressures, including material supply and labour shortages, this Bill will only make things worse and risks undermining national economic prosperity and future job creation. The Government should resist the temptation to pursue industrial relations policies that will have an adverse effect on low unemployment, productivity and impact real wages in the long-term. We will update members on the progress of the Bill over the coming weeks and months.

Later in the week inflation data was released showing the worst may be over for building material inflation. The inflation data showed:

• The cost of home building materials rose by +16.0 per cent over the year to the September 2022 quarter.
• While this still represents strong cost pressure, it is a slightly lower rate than in the June 2022 quarter (+17.3 per cent).
• For timber and steel, there are signs that cost pressures have become a bit less acute.
• However, pressures appear to be mounting for some materials like ready mixed concrete, sand and some plumbing products.

Labour force data released on Thursday indicate that the construciton workforce in the ACT has increased to 15,977 (as at August 2022), however remains 2,564 workers less than the pre-COVID period (February 2020).

The proportion of females in the ACT’s construction workforce has increased from 11.1% to 13.% over the past year. Construction remains the number 1 employer of apprentices compared with any other industry.

Next week we look forward to welcoming members at our inaugural Sustainability Conference and Annual Dinner.