On Tuesday, as Queensland opened its borders to New South Wales and Victoria, the Treasurer handed down the much anticipated 2020-2021 Queensland State Budget.

The Budget, which is usually delivered earlier on in the year, had been pushed back in light of the COVID-19 crisis and the State election.

It’s no surprise that the Budget follows the path outlined in the COVID-19 Fiscal and Economic Review and the Government’s Economic Recovery Plan. These focused on protecting our health, creating jobs and working together.

As anticipated, the budget demonstrates the Government’s willingness to take on debt so it can fund job creation and business expansion. However, a notable absence for business owners is that further tax relief wasn’t provided as part of the Budget.

The budget looks to stimulate the Queensland economy through various measures. There are opportunities in the manufacturing and agricultural industries, and for small businesses (being over 97% of all Queensland businesses).

Below we’ve highlighted some of the main initiatives that will impact on Queensland businesses and may assist in their post-COVID recovery.

small business funding

small business adaption grants

A $196 million funding pool providing up to $10,000 per business for small and medium-sized existing businesses based in Queensland that are creating new jobs.

backing queensland business investment fund

A $500 million funding pool dedicated to direct investment in Queensland business and industry, managed by QIC, has been set up for Queensland based businesses with significant growth potential that satisfy the following criteria:

1. have significant growth potential (i.e. growing operations in Queensland, expanding in Queensland or relocating to Queensland) and demonstrate continued economic growth in Queensland;
2. will utilise the funds to create significant Queensland-based jobs;
3. have a proven product and defined market opportunity but require significant capital to build scale or grow market share;
4. are relatively mature, well beyond proof of concept and are generally profitable or approaching profitability (i.e. not start-ups);
5. are seeking capital to expand or restructure operations, enter new markets or finance significant acquisitions;
6. are not an investment fund; and
7. are not conducting any of the following as their primary business activities:
   1. finance (other than finance technologies);
   2. insurance (other than insurance technologies); and
   3. property development, land ownership, or construction (other than construction technologies).

A key to being successful in obtaining the funding is a business’ ability to also secure a third-party investor that will co-invest with QIC, in addition to the above.

Legal advice this funding will cover (and has been earmarked for) is restructuring costs to implement the expansion in Queensland or overseas, provided the restructuring meets the above criteria.

A subset of this fund is the Big Plans for Small Business strategy which will support the private investment with an initial $100 million to invest in small to medium-sized businesses that have significant growth potential and will create Queensland based jobs.

This fund can support businesses to grow and expand into new markets – including export markets and will support restructuring costs to implement expansion.

We will provide you with further details on these initiatives as they come to hand.

queensland manufacturing

made in queensland initiative

The Budget allocates an additional $15.4 million for the Made in Queensland program for 2020-2021.

This will be the third round of funding in this program and is anticipated to be allocated prior to 30 June 2021. We expect the opening of Round 3 to be early in 2021.  We will let you know when Round 3 opens.

We anticipate the eligibility criteria to be similar to Round 2 and is likely to provide matched funding up to $2.5 million.

This is a more generous funding initiative than the Federal Government’s Modern Manufacturing Initiative opening on Monday 7 December 2020, which only provides 25% of funding up to $1 million and is limited to six priority sectors (Resources Technology & Critical Minerals Processing; Food & Beverage; Medical Products; Recycling & Clean Energy; Defence; and Space).

manufacturing skills queensland

The Budget allocates $16.5 million to establish Manufacturing Skills Queensland to drive development of advanced manufacturing skills, including the establishment of two regional manufacturing hubs to support the growth of local manufacturers: being on the Gold Coast and in Mackay.

queensland trains

A $1 billion investment pipeline will provide jobs in the Maryborough region and enhance Queensland’s manufacturing expertise through an injection of:

1. $600 million for 20 new Queensland trains and the infrastructure needed to build them in Maryborough;
2. $1 million for a business case to replace carriages for the Westlander, Inlander and Spirit of the Outback long-distance services
3. continuing the $300 million, 10-year pipeline of manufacturing work to refurbish and maintain the existing Queensland Rail fleet; and
4. continuing an $85 million investment for Maryborough workers to repair incompatible internationally built trains.

hydrogen industry

The Budget allocates $10 million for the development of Queensland’s hydrogen industry over the next four years.

ensure your business capitalises on these opportunities

This year’s State Budget is clearly geared towards boosting Queensland’s economy through job creation and the expansion of established businesses.

Many small and medium sized businesses, and regional businesses, will benefit from the targeted initiatives.

We have proven experience in assisting with business expansion and guiding businesses through grant program compliance requirements. If you or your business would like to explore whether you are eligible for any of the newly announced funding, please get in contact with us.

The information contained in this article is general in nature and cannot be relied on as legal advice nor does it create an engagement. Please contact one of our lawyers listed above for advice about your specific situation.