It is great to be back in Adelaide and have the opportunity to talk to you about our Budget. I have been speaking as I move around the country about the opportunities that the Asian Century presents and the importance of getting the policy settings right to take advantage of these opportunities. This Budget has rightly focused on managing the mining investment boom and the job opportunities that come with it for the benefit of all Australians.
This morning I was down at Christies Beach High School where I visited the school's new science learning centre that was built as part of the Building the Education Revolution program. It was great to see the passion that the teachers and students there had for looking after the local environment around Christies Beach, Seaford and Aldinga. They're also learning real skills that they can take into the workplace. Many of the students are studying for foundation qualifications in land management so that they can get a head start in finding a job.
Giving our kids the best start in life through great schools, better training and more support services was a central theme of the Budget I handed down last week. Today, I want to talk about how this Budget is focused on getting the fundamentals right so we turn the opportunities of the mining boom into enduring prosperity. And so we can make sure that more Australians have access to the services and support that they need. But first I want to say something about the economic backdrop to this year's Budget.
Strong Fundamentals
Our economy has been hit in the short term by the recent natural disasters which have devastated families and communities. But while these events have shaken our economy, they have not knocked it off course. Our fundamentals are strong and our medium-term growth prospects are very bright. Growth is strengthening as an investment pipeline gathers pace. Unemployment is low and is set to fall even further. We've seen over 700,000 jobs created since we came to Government and we expect to see a further half a million jobs added by mid 2013. Our public finances are in relatively good nick. We'll be back in the black in 2012‑13 well ahead of our peers. And we are set to benefit from an historic transformation in our region.
For the first time in our history we are situated in the right part of the world, with global economic weight moving towards us. Importantly, Asia's re-emergence this century is not a short-run thing - it has been a long time coming, and will play out for many years to come. And it's not just a China and India story. It's as much about countries like Vietnam, Indonesia, and Korea. This has very big implications for our economy and brings very big opportunities for our businesses.
We've already seen our terms of trade reach their highest sustained level in 140 years. This is boosting incomes and driving an unprecedented investment boom. ABARES projects an extraordinary pipeline of $380 billion in resources investment - the biggest mining investment boom in our history. Right here in South Australia, BHP Billiton are looking at a dramatic expansion of Olympic Dam which would result in billions of dollars being invested in the state's economy.
But we know that not every corner of the country is feeling the immediate benefits of the investment boom. Consumers are cautious in their spending, credit conditions are still tight, and many of our industries are doing it tough with the high dollar. But history shows that we're a nation that can and does adapt with changing global conditions. The opportunities of the Asian Century will not just flow to our mining industry; they will spread across a host of industries in this country.
By the end of the decade some analysts are predicting an Asian middle class that is as large as that of the middle class across the rest of the world put together. Think what that means for producers of high quality goods and services - for Australian education providers, health providers, food, wine, travel. South Australia is perfectly placed to take advantage of the opportunities flowing from the growing Asian middle class. Already, South Australia's wine industry is a force to be reckoned with on the international stage, with the Barossa and Clare Valleys, McLaren Vale, the Adelaide Hills and the Coonawarra all recognised among the best wine regions in the world.
Combined with a comfortable Mediterranean climate and beautiful landscapes, these regions are becoming as popular with tourists from China and India as they already are with tourists from Europe and the United States. South Australia is also emerging as a leader in gourmet food and fresh produce which will be in increasing demand across Asia. Whether it's jam from Beerenberg, chocolate from Haigh's or a Vili's pasty, Made in South Australia is a byword for high quality fresh produce.
So we start with some tremendous advantages, but the opportunities that will flow from strong growth in our region won't just fall into our lap. If we are to secure full advantage from what will be the Asian Century we need to keep getting the fundamentals right. During the GFC, we chose to take the necessary action to keep our economy strong, to keep businesses open, and to keep families in work. That action helped position our economy as one of the strongest in the developed world. And we want to keep it that way. But just as it was right for the Government to step in during the global crisis, it is right to step back as private activity resumes, to budget for surpluses, and to pay down net debt.
Australia's strong growth outlook and low unemployment makes a return to surplus by 2012-13 essential to ensure that we are not compounding the inevitable price pressures of the investment boom. That's why we are getting back to surplus in record time, delivering a fiscal consolidation of almost 4 per cent of GDP over two years. And we're delivering this despite the overhang from the GFC which is still impacting on revenues. The rapid return to surplus is made possible because we have taken difficult decisions with $22 billion in savings this Budget. These were hard but necessary decisions to ensure we stay within our strict fiscal rules and to limit overall growth in spending.
The savings decisions in this Budget were also necessary to make room for vital investments in our economy, our businesses and our people. Every extra dollar we're investing in skills, education, health care and supporting families and businesses was fully funded out of savings from elsewhere in the Budget. We chose to pursue these priorities in this Budget not just because we believed that it was important for our economy, but because we also believe that they are critical to providing opportunities for more Australians.
At the end of the day economic statistics alone are not the measure of success; it's about delivering tangible improvements to people's lives. That's why getting the fundamentals right is so important - so we have the capacity to invest in the things that all Australians rely on - better health care, better education, and greater job security.
More Opportunities for Better Education and Training
This Government has always believed in the transforming power of a good education and good training. Getting more Australians into more rewarding jobs lies at the heart of this Budget - it's what we're all about. That's why we are so determined to invest in our people to build the bigger and better workforce our economy so desperately needs. Australia has a huge demand for skilled workers. Not just in the mining industries, but across the country. It's what I hear from employers every day in many industries right around the country.
So we'll work with employers - we'll co-fund training places, to lift the skills of our workforce and deliver the workers our industries need. We know that scarcity applies to trades, so we want to find as many new apprentices as we can. Apprenticeship completion rates are too low - whether young people haven't found the right trade for them, or they get discouraged by training that just takes too long.
We help fund 400,000 apprentices each year, but around half of these won't complete - that's bad for the apprentices and bad for the economy. So we'll spend $101 million to help more apprentices finish their training through improved mentoring - a great investment in our future workforce. And we'll invest a further $100 million to encourage and support them to complete their apprenticeship more quickly, by recognising what they've learned, rather than the time they've served.
We're reforming vocational education and training to ensure it delivers the skills our economy needs. We're pulling down the barriers that often prevent people who are otherwise willing and able to work from taking the next step. Too many Australians are missing out on work now, because they missed out on learning basic foundation skills that most of us take for granted. Around 40 per cent of working age Australians don't have the literacy and numeracy skills to participate in a high-skilled economy. That's why we're investing $263 million to expand programs which help people bring their basic job skills - including reading, writing and maths - up to the standard that's needed in the modern workplace.
I have always believed in the idea that no matter where you were born or whatever your parents did for a crust, everyone is entitled to get the best start in life. So we're making more than $800 million in additional investments in our schools in this Budget, so that every student, in every school, in every city can get a great education. This includes $425 million to reward the very best performing teachers right around the country with bonuses of up to 10 per cent of their salary. Here in South Australia, around 1,800 teachers are expected to share in these special bonus payments. By investing in great training and top quality education we're making sure that more Australians can reach their full potential.
Opportunities for More Australians
We also want to draw more Australians into our workforce, not just to help industries get the skilled workers they need but to give more Australians the enduring benefits of a rewarding job. It's unacceptable that 80 per cent of teenage mums haven't gone through to Year 12. And that today, more than half a million Australian children live in jobless families. I'm not prepared to accept those sorts of figures.
It's why in areas of entrenched disadvantage we're introducing new participation requirements matched by new services for jobless families and for teenage mums. In South Australia, we will be adopting these approaches in Elizabeth, which has an unemployment rate of 12.7 per cent. Elizabeth is also one of the five sites where we will extend income management, which is something that the local Member, Nick Champion, has strongly advocated for.
We're also offering incentives for employers to provide new opportunities for the very long term unemployed. In South Australia alone there's something like 20,000 very long term unemployed, many of whom would jump at the chance of regular work. And we're cutting effective tax rates for single parents, investing in their skills, and transitioning more parents with high school kids onto job search payments. Step by step we're breaking down the barriers that prevent disadvantaged Australians from participating and sharing in the benefits of a growing economy. And one of those barriers relates to the access people have to the quality health services they need.
Delivering World Class Health Care
That's one of the reasons we're investing $3 billion in better health services, better hospitals and better care for the mentally ill. We know that nearly one-third of Australians will experience a mental illness at some stage in their lives. Without treatment, mental illness can lead to disengagement from society, unemployment, family breakdown and suicide. That's why our investment of $2.2 billion for the National Reform of Mental Health to ensure that no one with a mental illness misses out on an opportunity to participate in society.
A key focus of our reform is on prevention and early intervention. We know that one quarter of people with a mental illness experience their first episode before the age of 12 and the majority before the age of 21. Our investments in new headspace centres, and new Early Psychosis Prevention and Intervention Centres will provide more support to young Australians in their vulnerable years. And we're providing additional funding to Helpers and Mentors for the mentally ill, to provide intensive assistance for 1,200 people to seek employment, education or training.
These steps build on the initiatives in our participation package to expand opportunities for employment for the mentally ill and people with a disability. We are doubling the number of hours people can work before they lose disability support payments, and providing new incentives for employers of people with disability. In a wealthy society like ours, faced with the challenges we have, we simply can't afford to ignore the potential of so many Australians.
Conclusion
I'd like to thank you for listening to me today about some of the key themes and initiatives in my fourth Budget. This Budget was first and foremost about continuing to get the fundamentals right. So we can maximise the benefits of the mining boom and put the opportunities that flow from a strong economy within the reach of more Australians.
We count ourselves among the strongest economies in the developed world not just because of our macroeconomic performance, but also for the improvements we can make to people's lives - through delivering better services and more opportunities to get ahead.
We're a country that's sitting on the cusp of something truly special if we continue to get the policy settings right. That means harnessing the talents of all of our people. It means investing in their skills, training and education. It means making sure all Australians have access to the same opportunities. It means taking everyone along with us, not wasting a single pair of capable hands. Which is why this Budget focused on getting the policy settings right not just for today, but for the future economy as well.
Thanks.