Research Briefing | May 29, 2024

Australian federal budget delivers no surprises

The 2024-25 federal budget affirmed the forecast changes we made in the April 2024 edition of our Engineering Construction in Australia (ECA) service. We continue to expect publicly funded activity to average $54.1bn over the five years to FY28, compared to an average of $42.1bn over the five years to FY23.

Access the research report to learn more about the key points outlined below:

  • The Treasury’s updated outlook for engineering construction spending brings the publicly announced pipeline of projects in line with our forecasts. However, capacity constraints and rising construction costs continue to pose downside risks to the pipeline of work.

  • The budget announced support for the development of Australia’s critical minerals and hydrogen industries – including funding to map Australia’s resource endowments. These announcements do not materially change our forecasts. Investment in mines for critical minerals is only a small portion of total mining investment, and we continue to expect a hydrogen industry will begin to develop over the second half of this decade.

  • The federal budget also confirmed our strong outlook for publicly funded maintenance expenditure as published in our Maintenance in Australia report. Overall, we continue to expect maintenance expenditure in Australia to averagge $58.7bn over the five years to FY28, 9% higher than the average over the five years to FY23.
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