We also welcome the NSW Government’s commitment to making improvements to the NSW Planning system, including upgrades to the NSW Planning e-portal and technology investments, and the funding of more local government planning positions. These investments should help to speed up the planning process within NSW, with the goal of increasing delivery of residential dwellings, along with other asset classes. The Government will also leverage its own land to support the delivery of housing across private, social and key worker housing segments.
This State Budget makes major efforts to deliver equitable outcomes to Greater Sydney’s burgeoning population westward, ensuring that communities are well-serviced. The NSW Government has allocated $3.6 billion over four years for the redevelopment and upgrading of hospitals across Western Sydney, including Bankstown Hospital, Nepean Hospital, Fairfield Hospital, and Blacktown Hospital. Ensuring that people have access to high quality medical facilities will only become more important as more people live longer. Investment in new and upgraded schools throughout Western Sydney and Regional NSW, in addition to the expansion of recruitment programs for hard-to-staff schools, demonstrates the NSW Government’s continued focus on investing in education. Funding for the continuation of the $60 weekly toll cap supports long distance commuters, notably impacting a higher number of key workers who live in Sydney’s outer suburbs. This ultimately mitigates barriers to choice and opportunity in the labour market and in people’s everyday lives, making the Greater Sydney economy more dynamic.
While the 2024-25 NSW Budget contains significant and important funding measures, some issues remain unanswered. The Government’s investment in housing, social infrastructure and transport delivery comes during a historically tight labour market. With an extremely low statewide unemployment rate of 3.8% for May 2024, an increase in employed people and a decrease in the underemployment rate, there will likely be difficulties in sourcing appropriate construction, education, and transport labour. Limited investment in innovation means that that there may be difficulties in delivering these services in a cost-effective or timely manner. As such, innovation and productivity in these sectors will heavily impact the deliverability and inflationary impact of these Budget measures.
The tax increases for foreign investors and landowners may also have a counterproductive effect, with increased costs potentially impacting feasible of projects. The Government has also frozen the tax-free threshold for land tax at the 2024 level of $1.0755 million (excluding land used for owner-occupied residences). These measures have the potential to disincentivise investment in NSW from foreign and domestic investors, compared to less tax-intensive states. Given that the supply of housing is one of, if not the most, pressing issues faced by the State at this time, disincentivising investment in the NSW built environment is a clear risk.
On another note, we note that there has been a need to allocate funding to the Aerotropolis Precinct and its surrounds, with the new Western Sydney Airport due to open in mid-2026. Funding for the delivery of roads, public transport and enabling works for the Bradfield City Centre was ultimately necessary and inevitable to ensure operational readiness of the precinct in line with the opening of the airport. It is appreciated, however, that funding has been dedicated to these items to ensure this is achieved.
Overall, Minns’ NSW Budget for 2024-25 puts the key needs of the State’s people at the forefront. While there are potential risks related to funding, the AAA credit rating and delivery of the Budget, the intentions of the Minn’s Government are well-placed and will be favourable if delivered.
