WHILST avoiding the controversy that plagued last year's Budget, the 2015-16 Federal Budget is light on the structural reforms necessary to drive Australia's future economic growth, according to the Urban Development Institute of Australia (UDIA).
In its response to the Federal Budget, which was handed down last week, the UDIA said greater focus must be placed on reforms to boost productivity, investment and the nation's standard of living.
UDIA National Vice President Michael Corcoran said that investment in new housing and productivity-enhancing infrastructure in major cities would be central to Australia's future prosperity.
"The unwinding of the mining boom is placing a heavy toll on government finances and the broader economy, and that's clearly reflected in the 2015-16 Budget," Mr Corcoran said.
"Development and new housing construction is currently doing much of the heavy lifting in the Australian economy, and with most of Australia's capital cities still suffering from a chronic housing shortage, it's an area that still has plenty of room to grow.
"Unfortunately barriers such as inadequate investment in urban infrastructure, red tape, and high and inefficient taxes and charges on new housing are still holding back new housing construction, and contributing to worsening housing affordability."
The Budget has projected dwelling investment to hold steady at 6.5 per cent in 2015-16 before decreasing to 4.5 per cent in 2016-17. The UDIA said this demonstrates the critical need for the government to take action to remove the barriers holding industry back if growth is to be maintained.
With no major new reforms to enhance productivity or drive new investment in the Budget, the UDIA said the spotlight will now be on the government's White Papers on Tax Reform and Reform of the Federation, which are currently under way and due to be released next year.
"Given the significant challenges facing Australia, the Government needs to get serious about making the difficult changes necessary to support future growth. Failure to do so soon will put Australia's future prosperity at risk," Mr Corcoran concluded.
Photo: 'Australia seen from space at night' / Craig Mayhew and Robert Simmon, NASA/GSFC / Licensed under Public Domain via Wikimedia Commons.