In his budget reply speech, Anthony Albanese has flicked the switch from “we’ll have policies before the next election” to “here, have three policies”.
So what were the big ideas the Labor leader unveiled on Thursday night?
Rewiring the nation
Labor will invest $20bn (off budget) to establish a government-owned entity, Rewiring the Nation Corporation, to rebuild and modernise the electricity grid.
Think of it as the NBN Co of the electricity grid, a government body to make investments in infrastructure we all use that delivers an economic benefit but may not be built quickly (or at all) by the private sector.
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The corporation will make investments and partner with industry to deliver the Australian Energy Market Operator’s integrated system plan – a blueprint promising to transform the grid from one designed to deliver coal-fired electricity from centralised power plants to one that integrates a higher mix of renewables.
The system plan, released in July, identified projects such as the Marinus Link interconnector to Tasmania, the HumeLink transmission line and the Central-West Orana renewable energy zone transmission link as priorities.
It suggested that renewable energy may at times provide nearly 90% of electricity by 2035; and that 26 gigawatts of new large solar and wind farms and six and 19 gigawatts of dispatchable power will be needed to replace 15 gigawatts of coal-fired generation that is scheduled to shut.
According to Labor, fixing transmission is technology neutral but the grid will deliver “renewables as the cheapest new energy source” – lowering costs for electricity consumers.
Albanese said by “using the commonwealth’s ability to borrow at lower interest rates, it will be done at the lowest possible cost”. The corporation will have a mandate to recover its real costs, not to deliver a commercial return or profit to government.
Albanese said the policy will deliver a boost to the economy of “up to $40bn and create thousands of new jobs”.
According to AEMO, that $40bn benefit will be realised under the fastest-paced “step-change scenario” in which “consumer-led and technology-led transitions occur in the midst of aggressive global decarbonisation and strong infrastructure commitment”.
Childcare subsidy boost
Albanese said the childcare system “penalises the families it’s meant to help” because “for millions of working women, it’s simply not worth working more than three days a week”. That’s because the combination of tax and the cap on childcare subsidies can mean an extra day’s care costs more an extra day’s earnings.
Scrap the $10,560 annual childcare subsidy cap.
Lift the maximum childcare subsidy rate to 90%.
Increase childcare subsidy rates and taper them for every family earning less than $530,000.
Under Labor’s plan, families earning less than $80,000 will get the full 90% subsidy, down to 35% for those earning $356,700 and finally $0 for those earning $530,000.
It calculates that this will deliver an average saving of $600 for families earning below $72,406; $2,000 for those earning up to $177,406; and $2,900 for those earning up to $346,696.
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Albanese said the Australian Competition and Consumer Commission will “design a price regulation mechanism that will ensure every taxpayer dollar spent flows directly through to savings for Australian families”, 97% of who will be better off after the maximum subsidy is lifted.
Labor will also ask the Productivity Commission to “investigate moving to a 90% subsidy for childcare for every Australian family” as a “long-term goal”, Albanese said.
If that rate were adopted, it’s not quite free childcare – families will still have to pay 10% of the cost of care – but it’s about the closest thing to it.
Draw up a national rail manufacturing plan to encourage more trains to be built in Australia.
Devise a defence industry development strategy to leverage $270bn in defence investments to develop Australia’s sovereign industry.
Make a skills guarantee to give apprentices, trainees and cadets work on commonwealth projects.
These ones aren’t exactly new. Former Labor leader Bill Shorten promised a rail manufacturing plan before the last election and committed that 10% of jobs on major infrastructure and defence projects would be filled by an apprentice or trainee.