The Federal Government will spend $22 billion on infrastructure projects and $4.5 billion on clean energy initiatives, while Australia will be plunged into a record $57.6 billion deficit, Treasurer Wayne Swan revealed in the 2009-10 Budget.
With close to one million Australians expected to be jobless by next year as the economy contracts by 0.5 per cent, unemployment was predicted to rise to 8.5 per cent in 2011. However, Swan said 210,000 jobs had been supported in the budget.
Infrastructure projects around Australia will include $8.5 billion for roads, rail and ports, $4.6 billion for metropolitan rail projects and $3.4 billion for road networks with 35,000 building sites set to emerge around the nation.
The private health insurance rebate will be means tested for singles earning more than $75,000 and couples earning more than $150,000. Higher income thresholds for family payments will be frozen at current levels for three years until July 2012.
Swan said the global economic downturn had been a "brutal, uncompromising force" on growth, employment and Government revenue, and that the budget was required to offset this with a program of responsible borrowing.
"This is a budget about nation building for recovery," he said.
The caps on superannuation concessions will also be lowered from $50,000 to $25,000 and from $100,000 to $50,000 for over those aged over 50.
As flagged, the Government will fund an 18 week paid maternity leave scheme from 2011 at $544 a week, at a cost to the Government of $731 million over five years.
An investment of $2.7 billion for higher education, research and innovation was also allocated in the budget.
As part of the clean energy initiative, funding will include $2.4 billion in low emissions coal technologies which included solutions for carbon capture and storage of coal fire at an industrial scale. There was also $1.6 billion allocated to position Australia as a world leader in solar energy technology which included four solar power flagship projects. The Renewables Australia body was also established by $465 million in funding to support research into renewable energies.
The single aged pension will be increased by $32.49 a week for singles and $10.14 for couples, while the qualifying age for the pension will be raised to 67 progressively over six months from 2017.
The first home owner's grant will also continue for the next six months, but only at the full rate until 30 September.