Brendan Coates

Brendan Coates

Legal changes for 2020 bring winners and losers

Families eager to buy their first home, dairy farmers and those on some welfare payments can look forward to January 1, when a host of changes will come into effect implementing some of the Morrison government’s responses to issues that dominated politics in 2019.

In Victoria, there will be slight increases in public transport fares and electricity bills, new levies for builders and gold miners and financial relief for domestic violence victims.

Home loan guarantees

Among the changes is the First Home Loan Deposit Scheme, which the federal government announced in the lead-up to the May election amid a debate over housing affordability.

From the New Year, it will mean a saving on mortgage insurance for borrowers with deposits as low as 5 per centby providing a government guarantee over their loans. Only the first 10,000 eligible borrowers who apply for the scheme will get it.

There is a property price cap of $600,000 in Melbourne and $700,000 in Sydney. Single applicants cannot be earning more than $125,000 a year and couples no more than $200,000.

From January 1 the only lenders able to access the scheme for their clients will be the Commonwealth Bank and NAB, but a group of 25 smaller lenders will be able to make guaranteed loans from February 1.

Those interested in the scheme, which will cut the time required to save for a deposit, have been warned they could face paying tens of thousands extra in interest over the life of their loan as a result of having a lower lump sum to begin with.

Dairy code

After a hard year for Australians in rural areas – particularly dairy farmers who have had to cope with a drought and low milk prices – a new code of conduct for the industry will start operating.

Dairy farmers will be told what they will be paid over the life of their contracts under the new code, and processors will be barred from changing the contract price or conditions.

Welfare payments

There will be modest changes to the welfare system too. Some payments including the carer allowance, youth allowance and Austudy will rise through indexation.

And the government’s changes to ABSTUDY eligibility rules for the families of Indigenous children who move away to study will come into effect, increasing payments to the families of more than 2000 Aboriginal and Torres Strait Islander students who need to live away from home to go to secondary school by, on average, $5900 each year.

Whistleblower protections

It is the deadline for public companies and large private companies to have whistleblower policies in place that set out who whistleblowers can disclose inappropriate conduct to (including, in some limited situations, to journalists), how the company will respond and the steps it will take to protect the whistleblower.

Companies that miss the deadline will face penalties from the Australian Securities and Investments Commission.

Cheaper medicines

Sick people will be able to access cheaper medicines more quickly, with the government reducing the threshold to receive free or further discounted medicines through the Pharmaceutical Benefits Scheme by 12 scripts for pensioners and concession card holders and the equivalent of two scripts for non-concession card holders.

Some workers who salary-sacrifice to boost their super will get a further benefit, with employers required to pay super on their employees’ full salary rather than the reduced amount post-sacrifice.

IN VICTORIA, some state laws, regulations and fees will also change on January 1.

Public transport fees

Public transport users will pay an extra 20¢ a day, with the daily full fare in zone 1 to cost $9. The 1.7 per cent hike, in line with the consumer price index, is the lowest increase to public transport fares since 2010, but it follows several annual rises.

Electricity prices

Your next power bill could look a bit steeper. Households can expect to pay an extra $50 and small businesses an additional $200 because of transmission and state land taxes.

The Victorian Default Offer is set to rise by 7.8 per cent, so energy regulator the Essential Services Commission has urged consumers to check their bills.

“We are concerned at some reports some retailers are justifying big post-Christmas electricity rises on an unrelated moderate rise in the energy safety net,” the commission recently warned.

Flammable cladding

From January 1, builders will pay a new levy to fund rectification works for high-risk buildings covered in flammable cladding. The levy applies to new permits for multi-storey buildings, valued at more than $800,000, but does not include single dwellings, developments in regional Victoria, schools and hospitals.

Foreign purchaser taxes

Foreign property owners will start paying more on their land tax, with the absentee owner surcharge to rise from 1.5 per cent to 2 per cent. This is set to affect about 3000 owners.

Principal place of residence exemption

The principal place of residence tax exemptions will no longer apply to contiguous land in metropolitan Melbourne, as the state government seeks to reduce “land banking”. The exemption still applies where the principal place of residence is an apartment or unit with a separately titled car park or storage space, and for land in regional and rural Victoria.

Domestic violence financial hardship

Energy retailers will be required to recognise domestic violence as a form of financial difficulty and consider the victim’s circumstances before pursuing debt, as part of an updated retail code.

Gold royalty

Gold miners will pay a 2.75 per cent royalty from New Year’s Day. Under the Victorian legislation, gold was the only mineral exempt from royalties, but the state government argued Victorians were not receiving the full benefit of the state’s mineral assets. The royalty will not apply to the first 2500 ounces (about 70 kilograms) of gold mined by smaller producers.

Changes to the Broken River system


There will be a temporary change (from January 1 to June 30) to water sharing arrangements in the Broken River system, in the Goulburn Valley. The state government says changes to the way water is allocated, also known as qualification of rights, will give a lifeline to farmers battling dry conditions.