The Federal Budget is a winner for the middle class and for consumer confidence, according to media agency commentators.
The new government in Canberra is backing growth, while juggling inflationary demons, says Jules Hall (pictured below right), CEO of The Hallway.
"The new Labor heartland is the big winner in last night's budget - Australia's relatively affluent middle classes," says Hall.
"With a red hot economy, record low unemployment and runaway inflation, the Treasurer's tactics were largely as expected; make it easier to get more workers into the economy to reduce pressure on wage inflation (immigration, skilled worker visas, lift caps on student work participation and extend working holiday visas), cap energy bill inflation ($500 rebates from the Energy Bill Relief Fund), and try to contain rental growth (incentivise build to rent incentives).
"Most noticable is the somewhat tokenistic support for Labor's traditional voter base. Increasing the Commonwealth Rent Assistance makes a headline.
"But will they really help those struggling most? Same with the Single Parent subsidies. An important gesture, but is it enough to actually be meaningful?
"For the advertising industry, watch out ... the government is getting into in-housing! They don't call it that of course. It's hidden in two areas.
"The public service has received funding to grow by a whopping 15% compared to the start of the pandemic, getting to its highest headcount ever.
"And a new Treasury evaluation unit is tasked with recouping $200 million in consultant savings. Expect more noise, less action.
"The government, despite its best intent, isn't renowned for the efficiency of its delivery - that's what the free market provides. And what market is freer than the advertising industry of today, with practically zero barriers to entry?!"
Chris Parker (pictured below right), CEO of Awaken, says the 2023 budget had something for everyone, with the 2023 government slogan Back in the Black created to show a stable economy.
"It's hard to deliver a budget with so many groups voicing concerns for the economy and the cost of living," says Parker.
"This budget does look to support those most in need though, with $15 billion towards welfare, energy and medical programs, while banking 80% of the revenue to hopefully keep the RBA from pulling the only trigger they know how to use - a rate increase.
"This budget is a delicate balance signalling consumer confidence with an increase in cash flow for millions of households. But with a new blanket 15% corporate tax threshold on foreign companies, the question will be, is the potential decrease in profits just going to be passed on? Or will the current competitive market affect their P&Ls and not consumers new found increases from government payments?
"While there was not a large mention of the decreased tax rate on the highest tier (a carry over from the last government), it may net off the dissent of the increased tax rate to 30% to super accounts above $3 million.
"Hopefully this great strap line of 'back in the black' with increases to those most in need will strengthen consumer confidence across the board and ease some of the inflation pressure that has caused a flow-on effect to a large decline in advertising spend this quarter.
"Running into EOFY, Q1 of FY2024 will be interesting to see if the economy strengthens and if the RBA can hold on rates."
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