What does the 2015 Federal Budget mean for architecture?
The message from the 2015 Federal Budget Impact Survey is clear – some short-term gains for some, but few long terms benefits. John Held considers the results.
The survey of the reaction of heads of architectural practices to the 2015 Budget can be summed up fairly simply – not as bad as last year, and tax breaks might be handy (but only if I need to buy things anyway). The effect of last year’s budget reflected closely the predictions from the 2014 survey, but less than a third believed this year’s budget would have a positive effect on their business or the wider profession
Many commented that it lacked a long-term vision, both in terms of the deficit but more importantly in terms of moving to a sustainable future embracing new housing, transport, environment and renewable energy policies. Many comments focussed on wider concerns about Australian society, rather than their own businesses. Perhaps this is because their work naturally connects them to see a bigger picture than the next project.
“We are a small business, hence will benefit from the reduced company tax rate and opportunity to write off equipment purchases. On the downside, continuing lack of leadership on the environment, housing and transport will continue to erode the profession’s reputation and ability to make positive contributions.”
The larger practices seemed to be more negative about the Budget, as they would not be eligible for the tax breaks but at the same time were concerned about lack of government and commercial investment. Other comments noted that government investment in infrastructure was very limited apart from some road projects which generally do not involve architects. The reduction of state and local government spending on social infrastructure was also a concern.
More respondents this year noted they undertook business planning to help navigate changing economic circumstances. There was a general caution in spending, even with tax breaks available, and many noted they were trying to diversify because of fluctuations in different sectors of the market.
The ACA initiated the survey last year because it was concerned that the cuts signalled in the budget would have a negative impact on many in the profession. This did occur, even though many of the measures did not pass the Senate. We urge practices and the profession to continue to strategise carefully, and with both short- and long-term outcomes in mind. The ACA is continuing to develop further resources and research to assist with this.
The ACA focuses on the business of architecture and firmly believes that good business practices are essential to building a viable, sustainable profession – one that can make a serious contribution to Australian society while also providing a fulfilling, financially sound and equitable career for employers and employees alike. It is essential for the profession to work together to achieve this.
The ACA is committed to helping architectural practices navigate the business context of architectural practice, and works vigorously to deliver the best business environment and conditions for architects. To do this we need as many architects to participate as possible. Please consider joining us if you are not already a member!
The follow charts shpw the answers to questions one and three sorted by the areas the respondents’ practices are active in, and by the size of their practice.
John Held is ACA – SA President and a director of Russell & Yelland.