Scott Morrison's call for Australia to renovate won't rebuild a broken economy.

Extract from The Guardian

Opinion

Australian economy

Van Badham

The Coalition pivot beyond neoliberal business as usual was unsurprisingly inauthentic and the sabre-rattling at unions continues

@vanbadham

Thu 4 Jun 2020 16.38 AEST

‘Despite the government’s rush to consult McManus, the Liberals’ fundamental disbelief in the politics of a subsidy have warped its design.’ Photograph: Bianca de Marchi/AAP

On Wednesday, Australia’s Liberal treasurer, Josh Frydenberg, acknowledged Australia is in economic recession. The economy shrunk by 0.3% in the March quarter. June is expected to be worse. It’s our first acknowledged recession in 29 years.
The situation is unsurprising. Earlier in the year, Australia had to contend with the destruction and expense of summer’s devastating fires. Then it felt the impact of the coronavirus lockdown, with its fallout of suspended activity, lost jobs and changed consumer spending priorities.
And it’s going to get worse. The Age reports that economists, the Treasury and the Reserve Bank are “resigned to the June quarter showing the economy experiencing its worst three-month period since the 1930s”.

That’s not a period of which Australia, in any way, should wish to be reminded. During the Great Depression, unemployment in Australia hit a staggering 32%. The only country to supersede this index of misery – fatefully – was Germany.
And yet there are features of that awful time that have disturbing parallels to now. Firstly, there were structural problems in our economy pre-existing the onset of external disaster. Before the last election, statistics were sounding loud alarms about instabilities fomented by government policy inaction. A year ago there was already a retail slump, attributed to ongoing low wage growth. Indicators like a 16% drop in first-homebuyer loans and a 7.9% drop in new vehicle sales were read as a “warning sign of impending [economic] doom”.
It’s unfortunate that a pre-election declaration by the Australian Bureau of Statistics chief economist that “soft household spending” lay underneath Australia entering “a per capita recession” weren’t heeded at the time. Because the second sad parallel of the Depression-era past to now is that Australia has a government ideologically ill-equipped to manage the crisis.
It’s the Liberal-Nationals’ committed neoliberal policy habit of low-wage labour exploitation that has eroded spending capacity within the economy. The tracts of Milton Friedman have been literally gripped to the chest of Morrison’s parliamentarians as they’ve made business-generous “trickle-down” economic decision-making flow. Alas, the free-market-purist logic of allowing people to just – y’know – die in the service of economic growth turned out to be unpopular when government-friendly stalking horses gave this idea their best neigh in the media.

Morrison – brand-damaged by his Waikiki vacation and stumbling clown act in the bushfires – has been obliged by the shocked new recruits to Centrelink queues to pivot beyond neoliberal business as usual. Hence the unexpected, apparent glasnost between the hardline, neoliberal front of Morrison’s boyos with their long-chosen enemy, the trade union movement.
What a spectacle it is to see a neocon IR minister, Christian Porter, now desperate as a teenager before a dance to claim an iron socialist like the ACTU’s Sally McManus is his “new BFF”, despite her conspicuous refusal to do the same. The Liberal leadership have realised that only the application of Depression-ending Keynesian economic strategies can ameliorate their vulnerable political situation. They’re trying to glean economic concepts and grab some policy ideas from McManus and the unions because they cannot risk elevating and vindicating parliamentary Labor’s own Keynesians in the public policy conversation. Nor can the Liberals do nothing – they’d just cede an economic leadership platform to Labor’s Anthony Albanese.
This was the framework that informed the creation of jobkeeper – the income subsidy that originated from explicit union demands. Yet despite the government’s rush to consult McManus, like any inauthentic contribution to a project, the Liberals’ fundamental disbelief in the politics of a subsidy have warped its design. Jobkeeper has been slow to start, cumbersome to access, has not helped all those who needed help and is contributing to unemployment as opportunistic businesses exploit staff on the subsidy rather than create new jobs to meet demands.

So too have union demands for local procurement and investment in paid local jobs been contorted into the government’s unhinged “home improvement” stimulus scheme. A real “tradie-led” economic recovery would entail restarting government departments of public works and committing to the great projects of infrastructure-building with which the Curtin-Chifley Labor governments of the 1940s rebuilt Australia in the wake of the Depression and the second world war. This country is crying out for public housing, among many other things – but state enterprise and public services are anathema to the neoliberal DNA. Instead, Scott Morrison’s bizarre cash grants for home improvements have the conditions and restrictions of a wine club discount voucher where you have to buy more of what you don’t want at a price you can’t afford before the savings kick in at all.
Despite everything, the Liberals have continued their sabre-rattling at unions, repeating ancient threats of further “IR reform”, and a cartoon appeared the other day depicting the union negotiations with Morrison as the allegorical scorpion asking for a ride from a frog in a union T-shirt.
Given that the unions have presently negotiated Morrison’s government into progress on their demands, the removal of the union-busting “Ensuring Integrity” legislation and vindication of their most fundamental economic politics, I’d politely suggest that the famously birdwatching McManus is more sensibly depicted as an owl.
Owls have long memories. They hunt moving targets. Oh, and owls eat scorpions - don’t you know?

• Van Badham is a Guardian Australia columnist

Covid commission chief distances himself from leaked report on massive gas expansion.

Extract from The Guardian

Australian politics

Nev Power answers Senate inquiry questions about a ‘perceived conflict’ given his corporate interests

Katharine Murphy Political editor

@murpharoo

Thu 4 Jun 2020 17.46 AEST Last modified on Thu 4 Jun 2020 17.48 AEST

Nev Power told a Senate inquiry the leaked report should not be considered the view of the Covid commission but stood by his view that Australia needs a competitive gas supply to preserve and create jobs. Photograph: Mick Tsikas/AAP

The former Fortescue Metals chief running Scott Morrison’s Covid-19 coordination commission, Nev Power, has distanced himself from a controversial leaked report recommending Australian taxpayers underwrite a massive expansion of the domestic gas industry.
Appearing on Thursday before a Senate committee, Power said the report, revealed by Guardian Australia late last month, should not be considered the view of the National Covid-19 Coordination Commission. He intimated the report was a draft from the manufacturing taskforce that had been superseded by later advice.
The leaked report from the taskforce headed by Andrew Liveris, a former Dow Chemical executive and current Saudi Aramco board member, recommended the government underwrite an increased national gas supply, that government agencies partner with companies to accelerate development of new fields such as the Northern Territory’s vast Beetaloo Basin, and states introduce subsidy schemes for gas-fired power plants.

It also proposed a role for government in helping develop gas pipelines between eastern states and the north, and potentially a $6bn trans-Australian pipeline between the east and west, by either taking an equity position, minority share or underwriting investments.
But Power told the Senate inquiry the commission was not recommending the government subsidise gas.

He did indicate, however, that the commission was looking at subsidised infrastructure. “The commission is not recommending any subsidised delivery of gas or any other energy system, but we have talked about the provision of infrastructure to reduce the costs of transportation and deliver lower costs,” the NCCC chairman said.
Power’s role leading the NCCC has raised concerns among a range of civil society groups about potential conflicts of interest because the commission has heavily promoted gas development as a way to boost economic growth after the coronavirus crisis. The escalating public controversy about commercial conflicts prompted Power to step aside from his position as deputy chairman of a gas company, Strike Energy.
The NCCC chairman told Thursday’s hearing he stood by his view “that we should be looking at competitive gas supply for its potential as a raw material for both existing and new manufacturing industry to preserve and create jobs”. He said he agreed with Alan Finkel, the chief scientist, “that there is a role for gas in firming up renewables as we transition to lower emissions”.

But Power acknowledged there was a “perceived conflict”, given his corporate interests.
He said he had not attended a board meeting of Strike Energy since he joined the commission and “I have not voted on any operational or strategic matters and will not while I am at the NCCC”. But in response to questions from the Labor senator Murray Watt, Power said he “probably” was still being paid a director’s fee.
Asked whether the development of a trans-continental pipeline would benefit Strike Energy, an oil and gas exploration company, Power replied “no, not necessarily”.
Power was asked to confirm whether he remained a shareholder in Fortescue, and whether the proposed pipeline would benefit that company. He confirmed he remained a shareholder in Fortescue, and he acknowledged that FMG had lobbied for a trans-continental gas pipeline when he was the chief executive. But Power said Fortescue would not benefit from the pipeline now, because it had not developed gas interests.
Asked whether he had recused himself from discussions among commissioners about developing gas as part of the Covid-19 recovery, Power replied: “No, I haven’t.”

In response to questions about his remuneration, Power confirmed he was being paid $267,345 to cover his expenses. He said the money was paid into a trust, and he said the trust paid tax in according with tax office rules. Officials from the Department of the Prime Minister and Cabinet said Power was not required to keep receipts to demonstrate expenses.
Power commutes to Canberra on a private aircraft. He told the hearing he piloted the plane, and had periodically given Perth-based government ministers a ride home to the west during the Covid crisis. He had sought and been granted an exemption for travel, because WA has closed the border. Power was also granted an exemption to fly to Queensland to manage his private agricultural interests.
Malcolm Thompson, the deputy chief executive officer of the NCCC, told the hearing commissioners had procedures to declare conflicts of interest. At a hearing of the Senate committee in mid-May, NCCC officials said Liveris was not required to make a disclosure because he was an adviser to the commission, not a commissioner.
But on Thursday, Thompson told the committee Liveris had now been required to make a conflict of interest declaration. He said declarations had also been sought from the chair and all the members of an industrial relations taskforce appended to the commission.

Thompson also indicated the budget for the NCCC had increased from $3m to $5.4m.

The homebuilder scheme is simply pork-barrelling to the Coalition's electoral base.

Extract from The Guardian

Opinion

Australian politics

Emma Dawson

It’s a terrible use of public funds, will exacerbate inequality and do little to create new jobs

@DawsonEJ

Thu 4 Jun 2020 13.00 AEST Last modified on Thu 4 Jun 2020 21.28 AEST

‘There can be no justification for pumping public money into the hands of homeowners with the capacity to take on six-figure loans for renovations.’ Photograph: Dan Peled/AAP

The government’s “homebuilder” program is surely in the running for the most mendacious piece of public policy since Peter Costello decided to give tax refunds to people who don’t pay income tax.
To kickstart what prime minister Scott Morrison calls a “tradie-led recovery”, the government will provide grants of $25,000 to eligible home owner-occupiers, through a temporary program that will deliver an estimated $688m over six months to individuals who earned up to $125,000 last financial year or couples who earned up to $200,000.
To get the grant, they must enter into a contract between now and December to build a new home worth up to $750,000 or to “substantially renovate” an existing one valued at up to $1.5m, with a minimum renovation cost of $150,000.

If you set out to design a fiscal stimulus measure that would fail to meet any objective economic criteria, you couldn’t do much better than this.
How many Australian families with a combined income of less than $200,000 per year do you think are planning a $150k renovation in the next six months? If they are, do you think they wouldn’t have gone ahead anyway without a cash grant of no more than 16.66% of their costs?
Anyone able to start this kind of large-scale renovation by the end of the year either already has their finance lined up and hasn’t suffered an income cut during this crisis that would make them reconsider, or has the cash to do it without borrowing.
The impact on new housing construction will almost certainly fall short. New home buyers are overwhelmingly younger workers. According to the most recent labour force data, their incomes have been smashed by the Covid-19 economic shutdown, with unemployment and underemployment amongst those under 35 at record highs. How many of them will decide to take on a loan of up to $600,000 in the middle of the greatest economic downturn in a century, just because the government is chipping in around 5%?
Even if the government’s expectation of 27,000 grant applications is realised, it is likely that a significant proportion of the grants will go to projects that would have proceeded without an injection of public funds.

In economic terms, this package is, to use a technical term, nuts.
The grants are so poorly targeted to increase construction activity, it’s necessary to question whether that is in fact their intention. The outcome is more likely to inflate house prices, or at least to soften the widely expected fall in the value of existing homes. That might improve the nation’s headline GDP figures, but it does nothing to create new jobs or increase household living standards.
Australia has some of the highest levels of private (household) debt in the world, at over 200% of annual household income. This is almost entirely due to years of rampant speculation in the housing market, which has inflated home prices to the point at which they are among the most unaffordable in the world. Contrary to widespread belief, which has been deliberately fuelled by years of “debt and deficit” fearmongering by politicians, it is private, not public, debt that poses the greatest risk to our recovery.

As we emerge from this crisis, the ability of highly indebted households and businesses to spend money into our economy will be severely curtailed by reduced incomes and uncertainty about job security. Encouraging people to borrow more money to invest in their family home, in a market that is already losing value, is breathtakingly irresponsible.
That the government is fuelling household debt during a recession, while boasting that a $60bn underspend on its stimulus package is “a saving for taxpayers”, should put the lie once and for all to the Coalition’s claim of being superior managers of the Australian economy.
Even if, by the kind of miracle on which the PM seems to rely, this package is fully subscribed, it would remain a terrible use of public funds, and reveals a lack of fiscal discipline in the government’s approach to debt.
There is nothing disciplined about using public debt to increase private wealth. Government borrowing during a downturn should be invested in the productive capacity of the economy: to build public infrastructure that will make a financial return to the common wealth, or to invest in skills and training for Australian workers, which both increases individual opportunity while boosting productivity and economic growth.
To use borrowed, public money to increase the value of private property is a deliberate transfer of our common wealth to private asset holders. Most egregiously, this is unfair on younger Australians who will contribute to paying off the nation’s debt in their future working lives, without seeing any benefit from the money being pumped into the value of private homes today: indeed, it will actually make those homes less affordable for them.
There are around 150,000 applicants on the waiting list for a public housing unit in Australia. Over a quarter of those deemed to be of greatest need wait more than a year for a home. Investment in public and community housing is desperately needed. It would provide a genuine and immediate stimulus for the construction sector, building housing that otherwise would not have come to market, while increasing housing affordability and addressing homelessness.
There can be no justification for pumping public money into the hands of homeowners with the capacity to take on six-figure loans for renovations while hundreds of thousands of Australians go to sleep each night without a secure roof over their heads.
The mistaken belief that the government has abandoned ideology and found a new pragmatism in the face of Covid-19 should be firmly quashed by the announcement of “homebuilder”. It will exacerbate wealth and income inequality in Australia, and do little to create new jobs or improve living standards for lower and middle-income households.
It is, quite simply, pork-barrelling to the Coalition’s electoral base in a time of economic crisis, using money borrowed against our collective future. There’s nothing pragmatic about that.

• Emma Dawson is executive director of public policy thinktank Per Capita

Renovation grants: Morrison government to offer $25,000 in home builder stimulus.

Extract from The Guardian

Australian politics

The homebuilder scheme will run between June and December and aims to create a pipeline of construction work

Katharine Murphy Political editor

@murpharoo

Thu 4 Jun 2020 09.18 AEST First published on Wed 3 Jun 2020 22.30 AEST

Construction workers at Kellyville in Sydney’s west. Scott Morrison’s government is set to unveil homebuilder grants for building and renovations to help stimulate Australia’s post-Covid economy. Photograph: Dan Himbrechts/AAP

The Australian government will fund grants worth $25,000 for eligible singles and couples planning to build or renovate homes between June and the end of December, with the uncapped program estimated to cost taxpayers $688m.
With the March quarter national accounts indicating that Australia has entered the first recession in nearly three decades, the new tranche of economic stimulus designed to create a pipeline of work for the construction sector will be unveiled by the Coalition on Thursday.
To be eligible for the grants, singles need to earn $125,000 a year or less based on a 2018-19 tax return or later, and couples need to earn under $200,000. Building contracts need to be executed between 4 June and 31 December 2020.
To qualify, people need to be intending to build a new home as a principal place of residence valued up to $750,000 including the land, or planning to renovate an existing property, with the upgrade valued at between $150,000 and $750,000.

Existing properties need to be worth less than $1.5m before the renovation, and construction must be contracted to commence within three months of the contract date.

The homebuilder grants can be used for kitchen and bathroom renovations carried out by licensed contractors, but cannot be for used for add-ons like swimming pools, tennis courts, outdoor spas and saunas, and detached sheds or garages. The grants cannot be claimed for investment properties, and owner-builders are also ineligible.
The new stimulus program comes as the government has delayed a planned mini-budget to July, and the treasurer, Josh Frydenberg, has also signalled that the jobkeeper wage subsidy might be reduced from the current flat payment of $1,500, or paid at differential rates depending on a worker’s income, after a review.
Wednesday’s March quarter national accounts showed dwelling investment in Australia fell 2.9% in the quarter and by more than 15% over the past 12 months. The contraction is expected to be worse in the June quarter and construction lobby groups predict new dwelling commencements will decline by 50% by the end of 2020.

While government grants programs have been shown to drive up housing prices and construction costs, the government contends this won’t happen with the homebuilder package, because the slump in construction makes pricing competitive, and because the program is a short-term pump prime rather than a fixture, which makes it more difficult for developers to price the grant into their contracts.
The government has made it a rule that stimulus designed to counter the economic shock associated with the Covid-19 pandemic be delivered through existing mechanisms rather than new programs, to minimise the risk of fraud or administrative disasters.
The housing grants scheme is clearly a new program, but the government claims the same criteria will apply because it will be implemented through “existing systems, being the states’ respective revenue offices”.

In a statement before Thursday’s announcement, Scott Morrison said the new program was about job creation, and about supporting 1 million workers in the sector, including builders, painters, plumbers and electricians.
The prime minister said the jobkeeper wage subsidy had already helped Australia’s construction sector weather the opening months of the economic shock associated with Covid-19, and “now we’re helping fire it up again”.
“This is about targeted taxpayer support for a limited time using existing systems to ensure the money gets used how it should by families looking for that bit of extra help to make significant investments themselves,” Morrison said.
Before Thursday’s announcement Labor called for the government to include social housing in the construction stimulus. On Wednesday, the shadow treasurer, Jim Chalmers, said the government needed to address flaws in previous interventions to ensure the recession wasn’t a deep one.
“We need to see in that at least these three things,” Chalmers said. “We need them to fix up their blunders with jobkeeper so that fewer workers are unnecessarily excluded and we need to see social and public housing as a key part of any package of measures to support the building industry.”

Chalmers said the government needed to deliver “a comprehensive plan for jobs in this long and patchy recovery”.

Former president Barack Obama says US protests after George Floyd death can 'change America'

Extract from ABC News

US Election 2020

Posted Yesterday

Former president Barack Obama has urged leaders to harness momentum from protests to enact police reform.

Former US president Barack Obama says the nationwide protests following the death of George Floyd in police custody have provided the opportunity for people to be "awakened" and "change America".

Key points:

• Barack Obama said he was hopeful good could come from the protests
• He urged cities around the United States to review their police use-of-force policies
• Mr Obama directly addressed young people of colour, saying they "matter"

In his first remarks since Mr Floyd died in Minneapolis on May 25, Mr Obama said the US had been experiencing a "tragic", "difficult" and "uncertain" time as police and protesters clashed in cities across the United States.

But the country's first black president said he was hopeful about what could be achieved out of the demonstrations.

"In some ways, as tragic as these past few weeks have been, as difficult and scary and uncertain as they've been, they've also been an incredible opportunity for people to be awakened to some of these underlying trends," Mr Obama said.

"And they offer an opportunity for us to all work together to tackle them, to take them on. To change America and make it live up to its highest ideals.

"And part of what's made me so hopeful is the fact that so many young people have been galvanised and activated and motivated and mobilised."

Amid the peaceful protests, there has been looting and rioting in cities across America.(AP: Julio Cortez)

Mr Obama's speech offered a contrast in tone to the way his successor, Republican President Donald Trump, has responded to the protests, some of which have devolved into violence.

Mr Trump has threatened to deploy the US military to quell demonstrations and told governors to get "tougher".

This week, former presidents George W Bush, a Republican, and Jimmy Carter, a Democrat, issued statements that also adopted a more measured tone than Mr Trump has.

Mr Obama said this mobilisation of young people was sparking a change in mindset across the country.

"That's a direct result of the activities and organising and mobilisation and engagement of so many young people across the country, who put themselves out on the line to make a difference," he said.

"And so I just have to say thank you to them for helping to bring about this moment."

He also addressed a message directly to young people of colour, saying that they "matter".

"I want you to know that you matter, I want you to know that your lives matter, that your dreams matter," Mr Obama said.

Barack Obama says the mobilisation of young people is changing mindsets across the country.(AP: Nam Y Huh)

'This country was founded on protests'

Mr Obama was in office in 2014 and 2015 when US cities experienced riots and protests due to black deaths in custody.

His comments came in a virtual roundtable meeting with a program called My Brother's Keeper, which he founded in response to the death of Michael Brown in Ferguson in 2014, to reduce racial inequalities.

The former president also urged mayors across the country to work with their communities to review the police use-of-force policies and questioned the notion that one must choose between "voting versus protests" or "participation versus civil disobedience".

"This is not an either-or," he said. "This is a both-and."

Mr Obama says he is hopeful of what can be achieved out of the protests.(AP: Yuki Iwamura)

Mr Obama also implicitly rejected those, like Mr Trump, who have focused criticism on the demonstrators.

"For those who have been talking about protests, just remember: This country was founded on protests," he said.

"It is called the American Revolution."

AP/ABC

Australia's vocational education system faces further criticism as Government looks to overhaul sector.

Extract from ABC News

Politics

By political reporter Jade Macmillan

Posted 5hours ago

The Government is planning an overhaul of Australia's vocational education and training system.(PEXELS: BURST)

Australia's multi-billion-dollar vocational education and training (VET) sector has come under more criticism, with calls for major changes to overhaul a complicated and underperforming system.

Key points:

• The Productivity Commission has found substantial scope to reduce waste in the VET system
• Prime Minister Scott Morrison has vowed to overhaul the "clunky" system
• The Australian Education Union federal president has called for TAFE to be central to any reforms

The Productivity Commission found the skills-funding agreement between the Commonwealth and the states was overdue for replacement, saying targets had not been met and government funding could be better spent.

It also suggested students should be able to access loans for a wider range of VET courses.

"We hope the report will provoke a broad discussion of big reform," Commissioner Jonathan Coppel said.

"There is substantial scope to reduce waste and better target the $6.1 billion in government spending."

The interim report comes after Prime Minister Scott Morrison flagged an overhaul of the skills sector, which he labelled clunky and unresponsive, as part of Australia's economic recovery from the coronavirus pandemic.

Subsidies criticised, loans could be expanded

The report was critical of a lack of transparency about how government funding was used, and highlighted large differences in subsidy rates across the states and territories.

For example, standard subsidies for a popular course taken by students wanting to work in the aged care sector could vary by more than $3,500 across the country.

Scott Morrison announced a planned overhaul of the system in a speech last week.(ABC News: Tamara Penniket)

"It is time to think about shifting the focus from funnelling subsidies to training providers to giving students more help to choose the training they need," Commissioner Malcolm Roberts said.

The Commission said poor design was to blame for rorting under the previous Labor government's VET FEE-HELP scheme and that expanding student loans, with proper risk management in place, would make training more affordable.

It also called for government incentives encouraging employers to train apprentices to be reassessed, arguing there was little evidence they boosted enrolments.

"These payments offset only a small share of the total costs to employers of taking on a trade apprentice," it said.

"The Commission estimates that the Australian Government's employer incentives [which have remained fixed in nominal terms for many years] account for less than 2 per cent of the full costs of hiring, remunerating and training a trade apprentice."

Findings reinforce government strategy, Minister says

Skills Minister Michaelia Cash welcomed the findings, saying they reinforced the Government's argument that the National Agreement for Skills and Workforce Development (NASWD) needed to be replaced.

"We need a new funding model to better link funding to actual forward-looking skills needs, based on what businesses need," she said.

"It needs to simplify the system, reduce distortions and achieve greater consistency between jurisdictions, and between VET and universities."

The federal president of the Australian Education Union, Correna Haythorpe, said any overhaul of the VET sector needed to include a renewed focus on the TAFE system.

"Right now, TAFE is the only institution ready to meet the challenge of rebuilding Australia's workforce," she said.

"TAFE must be the Government's preferred solution for providing high-quality vocational education, helping people to get back to work and getting the economy moving again."

The Government's HomeBuilder scheme offers $25k for home renovations — but not everyone will qualify.

Extract from ABC News

Politics

By political reporter Jordan Hayne

Posted 1hour ago, updated 18minutes ago

You'll need to be planning on more than a backyard deck to access the scheme.(Pexels: NTWRK)

The Federal Government has unveiled its HomeBuilder package, offering $25,000 for people to upgrade or build their homes — but access to the scheme's free money won't come cheap.

The eligibility criteria are reasonably tight, with the Government expecting about 27,000 homeowners or builders to access the scheme.

For comparison, there are 7.7 million private dwellings in Australia, according to the Australian Bureau of Statistics.

The scheme's primary goal is to supply work for the residential construction sector, but some people planning a big project are set to benefit.

Here are the conditions you'll need to meet to access HomeBuilder, and how the scheme will work.

Am I eligible?

On a basic level:

• You need to be an adult Australian citizen with a taxable income less than $125,000 a year. If you live with your partner, your combined income has to be less than $200,000 per year
• Before the end of the year, you need to enter a contract to renovate or build your main place of residence, with construction to begin within three months of the contract date (no investment properties)
• For renovations, you need to spend between $150,000 and $750,000 of your own money, and the house you're renovating must be valued at less than $1.5 million prior to renovations
• Renovations need to improve the accessibility, safety or liveability of the home and don't include external work like swimming pools, tennis courts and sheds
• For new builds, the total value of the completed home needs to be less than $750,000, including land

Should you meet the criteria, there is still a handful of requirements on the contract side.

For instance, your contract needs to be negotiated at a fair market price, to prevent people from asking their builder to puff up the costs so you can access the grant.

There are fears forward contracts in the building industry could plummet.(ABC News: Dean Faulkner)

You can't ask your favourite uncle to do the work, with the scheme requiring you have no special relationship with your contractor, such as being related.

All works need to be conducted by a registered or licensed builder, depending on your state or territory.

If you have concerns your builder is increasing prices in light of these grants, you can ask them to demonstrate the cost is the same or lower than a comparable project in July 2019.

$150,000 seems like a lot...

It's fair to say you'll need to do more than a cosmetic bathroom renovation to qualify for the grant.

According to the Housing Industry Association (HIA), the average cost of a bathroom renovation in 2018-19 was $19,553, while a new kitchen would set the average household back $26,280.

Even combined, those projects wouldn't cost half of what the Government is encouraging renovators to spend.

But the HIA's Graham Wolfe said many renovations would be large enough to qualify.

The Prime Minister's main goal with the scheme is to keep builders in work.(AAP: Mick Tsikas)

"The thresholds provide for renovation works over $150,000 [and] our initial estimates suggest there would be in the order of 7,000 to 10,000 over the 6-month period of the package," Mr Wolfe said.

The goal of the program is not so much to get Australians' kitchens and bathrooms looking schmick as it is to keep tradies busy through a projected "valley of death" period over the back half of the year.

Mr Wolfe said he believed the program would help.

"Having a $150,000 minimum project spend ensures that there will be jobs retained in the industry," he said.

But Opposition Leader Anthony Albanese suggested that to meet the criteria, a bathroom renovation would require a "gold bath and pearl taps".

"There aren't too many battlers out there who have a lazy $150,000, who will see this announcement today and say, 'I'm going to go between now and December 31 and sign a contract for a project which is worth more than $150,000'," he said.

Housing Minister Michael Sukkar said the minimum spend of $150,000 would make sure that renovators have "skin in the game" when it comes to works on their homes.

More on offer than just HomeBuilder

Provided you have the money and meet the criteria, you can apply directly to your state or territory's revenue office for the new grant.

The Government says the states and territories will wear the cost of administering the program through existing systems, and the package can be paired with other benefits offered at the state and territory level.

Earlier today, Tasmania and the ACT announced concessions for first home builders and people purchasing residential land, respectively.