Statement by Live Performance Australia, sent to Members on 7 Oct.
The Federal Government handed down the 2020-21 Budget on 6 October 2020.
An underlying cash deficit of $213.7 billion is forecast in 2020-21 (11% of GDP) and will reduce to a forecast deficit of $66.9 billion in 2023-24, resulting in an accumulated deficit of $480.5 billion over the forward estimates.
There were no new initiatives announced for the live performance industry, but this Budget confirms previously announced arts and entertainment funding:
- $250 million JobMaker plan to restart Australia’s creative economy
– $75 million: Seed Investment to Reactivate Productions and Tours – competitive grant funding in 2020-21 to provide capital to help production and event businesses to put on new festivals, concerts, tours and events. Grants will range from $75,000 through to $2 million.
– $35 million: Supporting Sustainability of Sector-Significant Organisations – direct support to Commonwealth-funded arts and culture organisations facing threats to financial viability.
– $90 million: Show Starter Loans – concessional loans to assist businesses to fund new productions and events that stimulate job creation and economic activity. To be delivered through commercial banks, backed by a 100 per cent Commonwealth guarantee.
– $50 million: Kick-starting Local Screen Production – a Temporary Interruption Fund to support local film and television producers secure finance and start production.
- $27 million of funding for Indigenous Arts, Regional Arts and Support Act
– $10 million to help regional artists and organisations develop new work and explore new delivery models. The funding will be delivered through Regional Arts Australia’s Regional Arts Fund.
– $7 million to support Indigenous artists and arts centres. The funding will be delivered under the Indigenous Visual Arts Industry Support program.
– $10 million to Support Act to provide mental health services.
- Perth City Deal, where the Federal Government is contributing $327.5 million over 11 years from 2020-21 to support projects.
The Minister for Communications, Cyber Safety and the Arts, the Hon Paul Fletcher MP, has issued a joint media release in response to the 2020-21 Budget.
The 2020-21 Budget outlines a range of economy-wide measures, including:
- Tax Relief
– Personal income tax relief: Stage 2 personal tax cuts brought forward to 2020-21. A one-off additional low to middle income tax offset in 2020-21.
– Temporary full-expensing (instant asset write off) – estimated at $200 billion worth of investment.
– Temporary loss carry-back – allowing companies with a loss of up to $5 billion to offset losses against previous profits on which tax has been paid.
- JobMaker Hire Credit – supporting 450,000 positions for young people at a cost of $4 billion.
- JobTrainer Skills package to further support and encourage apprentices and trainees with $1.2 billion Apprenticeships Wage Subsidy.
- Supporting Regional Australia – a $550 million package to support regional Australia recover from the impacts of COVID-19. This includes more than $250 million for a Regional Tourism Recovery Package and $100 million over two years will go towards Regional Recovery Partnerships.
LPA’S RESPONSE TO 2020-21 BUDGET
The Budget announced last night was very much as expected. It is macro focused with some pretty optimistic forecasts. The Budget included the already announced $250 million arts and entertainment package plus some new incentives for business investment and loss carry back provisions.
While a lot of these measures are obviously going to be important in helping people through the economic crisis caused by COVID-19 and kick-starting the broader economy, our industry potentially faces a very long road to recovery. The Federal Government will absolutely need to consider extending support and provide more industry investment in the longer term. The cut to JobKeeper at the end of March 2021 will have a significant impact on many companies. It is unlikely our industry will be anywhere near full capacity by then, so we will need a targeted wage subsidy to support jobs. The industry needs a shared risk fund in partnership with government to underwrite business interruption risk. We will also need support to attract investment, drive consumer confidence and create jobs.
The forecasts in the Budget assume there will be a COVID-19 vaccine widely adopted across Australia by late 2021 and that social distancing requirements will be in place until then. The Budget also notes the risk of further outbreaks and containment restrictions. As the first industry to be shutdown by the pandemic, and potentially the last to reopen, these ongoing risks underscore the importance of a longer term and structural support plan for our industry.
In most states, except Victoria, we are operating at reduced capacity. Companies are losing money and those presenting shows are losing even more. The 50% density cap is not financially viable and we need to further lift restrictions and open borders; so much of what we do is national touring plus we need to be able to bring international artists in.
The next 12 months are going to be extremely challenging. If we are to protect our cultural assets, companies and skills base, and play our important part in the nation’s economic and social recovery, the Government will need to step up and provide further structural support in early 2021. It also needs to ensure the $250 million crisis package gets money out the door before Christmas. Come the May Budget, we will be expecting those industry sectors significantly impacted by COVID-19 (i.e. arts and entertainment and tourism) to be centre stage with targeted support and investment in a major Domestic and International Cultural Tourism strategy.
ADDITIONAL BUDGET INFORMATION
Further information on the 2020–21 Federal Budget can be found via:
- Federal Budget 2020–21 Papers
- Department of Infrastructure, Transport, Regional Development and Communications (including portfolio budget statements)
- Australian Chamber of Commerce and Industry Media Release
LPA will communicate any additional Federal Budget details relevant to Members.