Delayed for five months due to the COVID-19 pandemic, the 2020-21 Federal Budget was delivered by Treasurer Josh Frydenberg this week, including funding for infrastructure projects and a focus on manufacturing to help drive Australia’s economic recovery.
Australians have been “tested like never before” in 2020, with “flood, drought, fires and a global pandemic”, Frydenberg said in his Budget speech on Tuesday night.
Acknowledging the more than one million Australians who lost their jobs or saw their working hours reduced to zero in the space of a single month, Frydenberg said there was a “monumental task ahead” to rebuild the economy and secure Australia’s future.
Engineers Australia CEO Dr Bronwyn Evans HonFIEAust CPEng said the Budget represented an important milestone in Australia’s comeback from COVID-19.
“This week’s Budget marks the beginning of a new phase in national recovery from the pandemic and includes several initiatives that will rely on our profession for success,” she said.
Here are the areas that will most affect the engineering sector and related fields.
Infrastructure
The Budget allocates $14 billion for new and accelerated infrastructure projects, including $7.5 billion for transport infrastructure projects across every state and territory.
The initiatives will support more than 30,000 direct and indirect jobs over the life of the projects, according to the government.
Prime Minister Scott Morrison said the funding for infrastructure would support the government’s JobMaker plan and help the nation recover from the impact of COVID-19.
“We have been working closely with state and territory governments to invest in the infrastructure that is ready to go and can help rebuild our economy and create more jobs,” Morrison said in a statement.
“As part of the COVID-19 economic recovery plan we have invested an additional $11.3 billion focused on shovel-ready projects across the country.”
The importance of ‘shovel-ready’ and ‘screwdriver-ready’ maintenance projects, as well as the need for long-term planning, was highlighted in Engineers Australia’s COVID-19 Recovery: A 9-Point Plan report.
Released in May, the report set out key challenges and opportunities for economic recovery and discussed how Australia’s engineering profession could be a driving force.
“Investment in infrastructure is important because it is an economic multiplier,” Evans said.
“It creates jobs today, which puts new money into circulation, and delivers productivity gains for generations to come.”
Investing in local communities was another key point of Engineers Australia’s plan, in order to support local councils that had suffered significant revenue reductions.
The Budget addresses this with $1 billion in funding for local governments for the Local Roads and Community Infrastructure Program.
“Our community-led recovery plan empowers local governments nation-wide to deliver roads and community infrastructure,” Deputy Prime Minister Michael McCormack and Minister for Population, Cities and Urban Infrastructure Alan Tudge said in a joint statement.
“This will build shovel-ready local priorities, supporting local jobs and local business.”
Manufacturing and supply chains
The release of the Budget followed the Prime Minister’s announcement of a new Modern Manufacturing Strategy last week, which aims to make Australian manufacturers more competitive, resilient and able to scale up.
“The COVID crisis opens a new chapter for Australian manufacturing as a revitalised source of high-wage jobs, valuable exports and national income,” Morrison said.
“Through this strategy, we are determined to ensure government, industry and the research and education sectors are all working in the one direction to build scale in our manufacturing sector.”
The centrepiece of the strategy is the Modern Manufacturing Initiative, a $1.3 billion plan that will see the government invest in projects that help manufacturers grow and create jobs.
“COVID-19 has reinforced the importance of Australia’s sovereign manufacturing capability,” Frydenberg said.
“Almost overnight, resourceful Australian businesses adapted.”
The manufacturing initiative will focus on six priorities: space, defence, resources technology, medical products, recycling and clean energy, and food and beverages.
Challenges (and opportunities) within the supply chain were also revealed due to the COVID-19 crisis. The government will address these through a new $107.2 million Supply Chain Resilience Initiative to support projects that address an identified supply chain vulnerability.
It will also provide $460 million for the CSIRO over four years to address the impacts of the pandemic on its commercial activities and ensure it can continue essential scientific research.
As business leaders told Engineers Australia’s CEO Dr Bronwyn Evans during a series of roundtables held from June to August this year, a focus on Australia’s onshore capability in strategic areas has the potential to grow and support local manufacturing, and provide the nation with a competitive edge.
Energy
As part of its Economic Recovery Plan for Australia, the government aims to provide reliable, secure and affordable energy to all Australians.
To do this, it will accelerate the development of low-emission technologies to help reduce emissions, strengthen energy security and support jobs, Minister for Energy and Emissions Reduction Angus Taylor said.
The Budget includes up to $250 million to accelerate major transmission projects, such as Marinus Link, Project EnergyConnect and VNI West, as well as a $53.6 million microgrid program to support the development of pilot projects in regional Australia.
The Australian Renewable Energy Agency will also get $1.4 billion over 10 years to support the government’s Technology Investment Roadmap, by accelerating the development of new and emerging technologies to reduce emissions.
A further $70.2 million will be delivered over five years to activate Australia’s first regional hydrogen export hub, while $50 million will be invested in the Carbon Capture Use and Storage Development Fund to pilot carbon capture projects that will help dramatically cut emissions from large industrial facilities.
Women in STEM
It is well documented that women have been disproportionately economically affected by the COVID-19 crisis, with women making up the majority of those who lost their jobs.
These jobs have started to come back as lockdown restrictions have eased, but challenges remain, Frydenberg said.
In order to help female workforce participation reach pre-COVID levels, the Budget includes the government’s second Women’s Economic Security Statement.
This includes $240 million in measures to support new cadetships and apprenticeships for women in science, technology, engineering and mathematics, as well as to support women’s safety at work and home, and promote job creation and entrepreneurialism.
While the detail of the measures remains to be seen, Evans said the funding came at the right time.
“Women make up just 14 per cent of the engineering workforce and, at a time when the pipeline of new graduates and experienced migrants is at great risk due to the response to the pandemic, the workforce capability and resilience delivered by diversity is even more important,” she said.
A further $2 million has been allocated to extend the Women in STEM Ambassador initiative, $35.9 million to expand the Boosting Female Founders Initiative, and $10 million to extend the Women in STEM and Entrepreneurship grants program.