The BFG Report

Welcome to the May 2023 Edition of the BFG Report 

Federal Budget

The 2023 Federal Budget focuses on providing cost of living relief through lower power bills, higher welfare payments and more support for small businesses and housing.

Note: These changes are proposals only and may or may not be made law.


Cost of living  

  • Energy bill relief: An electricity bill credit of up to $500 will be available in 2023/24 for:
    • Commonwealth Seniors Health Card holders and other concession card holders
    • Pensioners, recipients of Carer Allowance and Family Tax Benefit A and B
    • Veterans, and
    • those eligible for existing State and Territory electricity concession schemes.

Eligible small businesses will receive a credit of up to $650. The amount of the credit will vary depending on the location, with no further details revealed in the Budget.

  • Pharmaceutical Benefits Scheme changes: Individuals will be allowed to buy twice as many common medicines for the price of one script under changes to the Pharmaceutical Benefits Scheme from 1 July 2023. This will allow a patient access to 60 days’ worth of medicine for each script.

The change will save general patients up to $180 a year per subsidised prescription. Concession card holders are expected to save up to $43.80 a year per medicine.

  • Increased bulk billing: Children under the age of 16, pensioners and other Commonwealth concession cardholders will have increased access to free healthcare under this measure, with bulk billing incentives being tripled for the most common consultations.
  • Household energy upgrades: A number of low-cost loans will be provided to access energy-saving home upgrades, such as battery-ready solar panels, modern appliances, and other energy efficiency improvements.


  • Reduced tax concessions: The Government will reduce tax concessions on certain superannuation accounts for individuals with a ‘total super balance’ (TSB) of more than $3 million (unindexed). The earnings on any balance that exceeds the $3 million threshold will be subject to an additional tax of 15% (up to 30% in total).

Individuals with a TSB less than $3 million will not be impacted by this change, and investment earnings on the accumulation balance will continue to be taxed at the maximum rate of 15%.

  • Increasing the payment frequency of employer super payments: Employers will be required to pay their employees’ super at the same time as their salary and wages from 1 July 2026.

Social security and Aged Care

  • Increase to working age payments: The fortnightly rate of JobSeeker Payment and certain other benefits will increase by $40 ($1,040 pa) on 20 September 2023.

The minimum age for the higher rate of JobSeeker Payment will also reduce from age 60 to 55 and over for those who have received the payment for nine or more continuous months. Single recipients aged 55 to 59 with nine continuous months on payment will receive an extra $99.40 per fortnight as a result of both changes.

  • Increasing Rent Assistance: The maximum rates of Rent Assistance will increase by 15% on 20 September 2023. This will provide recipients with up to $31 extra per fortnight.
  • Increase to Home Care packages: As part of a package to improve the in-home aged care system, the Government will increase the number of Home Care packages by 9,500 in 2023/24. This may help reduce the wait time for individuals who are waiting for a package to be assigned to them.

Personal taxation  

  • No changes to personal income tax: The Budget did not contain any measures announcing changes to personal income tax. This includes:
    • no changes to the Stage 3 tax cuts which will take effect from 1 July 2024, and
    • no extension of the Low and Middle Income Tax Offset, which ended 30 June 2022.
  • Increasing the Medicare levy low-income thresholds: The Government will increase the Medicare levy low-income thresholds for singles, families and seniors or pensioners from 1 July 2022. This means low-income earners will be able to earn more income before being liable to pay Medicare levy.

Small business taxation  

  • Small Business Energy Incentive: Small businesses with an annual turnover of less than $50 million may receive an additional 20% deduction on spending that supports electrification and more efficient use of energy.

Up to $100,000 of total expenditure will be eligible for the incentive, with the maximum bonus tax deduction being $20,000 per business. Eligible assets or upgrades will need to be first used or installed and ready for use between 1 July 2023 and 30 June 2024.

Examples of eligible assets include electrifying heating and cooling systems, upgrading to more efficient fridges and induction cooktops, and installing batteries and heat pumps.

  • $20,000 instant asset write-off: Small businesses with an annual turnover of less than $10 million will also be eligible to immediately deduct the full cost of eligible assets costing less than $20,000 for assets that are first used or installed ready for use between 1 July 2023 and 30 June 2024.

Small businesses can instantly write off multiple assets as the $20,000 threshold will apply on a per asset basis.


  • Changes to eligibility for home buyer guarantee schemes: From 1 July 2023, joint applications may be made by friends, siblings and other family members under the First Home Guarantee and the regional First Home Buyer Guarantee. Non‑first home buyers who have not owned a property in Australia in the last ten years will also be eligible.

Eligibility for the Family Home Guarantee is also expanding to include eligible borrowers who are single legal guardians of children such as aunts, uncles and grandparents.

The number of guarantees available and other eligibility criteria are unchanged.


Investment Market Review – March 2023


  • Global growth prospects for 2023 have improved significantly since December, says Fitch Ratings in its latest Global Economic Outlook report, but the impacts of rate hikes on the real economy still lie ahead and are likely to push the U.S. economy into recession later this year
  • Fitch has now lowered their global growth forecast for 2024 to 2.4% from 2.7% to reflect the lagged impact of rapid U.S. Fed and ECB interest rate hikes.


  • Share market performance in both the U.S. and Australia was positive for March. The S&P 500 rose by 7.03% for the quarter, while the Australian S&P 200 rose by 1.98%.
  • Within Fixed income markets, both government bonds and credit gained ground this quarter. The main Australian fixed interest index, the Bloomberg AusBond Composite 0+ Years Index gained 4.6%, while the Bloomberg AusBond Credit 0+ Years Index gained 3.4%
  • Global High Yield bonds, as measured by the Bloomberg Barclays Global High Yield Total Return Index Hedged into AUD gained 2.3% for the quarter.
  • Given the whole Australian Government yield curve is now lower than it was one month ago, composite Australian Fixed Interest funds are now looking somewhat less attractive, when compared to a month ago, but are still significantly more attractively priced than they were at the start of 2022.


Asset class performance to 31 March 2023 (total returns in AUD)

Asset Class 1-mth 3-mth 6-mth 1-yr 3-yr 5-yr 7-yr 10-yr 15-yr 20-yr
Australian equities (S&P/ASX 200) -0.20% 3.50% 13.20% 0.10% 16.50% 8.70% 9.40% 8.20% 6.5% 9.2%
International equities 3.90% 9.20% 13.50% 4.30% 12.90% 11.00% 12.00% 14.00% 8.9% 8.3%
Australian REITs -6.80% 0.50% 12.10% -13.90% 13.60% 4.80% 4.10% 7.70% 3.7% 5.2%
Australian bonds 3.20% 4.60% 5.00% 0.30% -2.40% 1.30% 1.70% 2.80% 4.4% 4.5%
Cash (AUD) 0.30% 0.80% 1.50% 2.00% 0.70% 1.10% 1.30% 1.70% 2.7% 3.5%

Sources: Bloomberg, IOOF calculations

* AUD total returns as at Mar-23 assuming reinvestment of dividends unless otherwise specified

** Returns reflect index performance excluding any fees; Actual ETF/managed fund performance will vary due to both fees and tracking error.


High yielding internet savings accounts

Financial Institution Interest Rate** Financial Institution Interest Rate**
ING Savings Maximiser 5.00% AMP Saver Account 4.80%
MOVE Bank 5.00% ANZ Save Account 4.25%
Great Southern Bank 4.85% Bankwest 4.00%

** Rates are subject to conditions and change. Rates are correct as at 08/05/2023.

Important Note – The BFG Report is published for your interest and every effort is made to ensure it is accurate and contains general securities advice only.  It is not possible, when preparing The BFG Report, to take into account individual clients’ investment objectives, circumstances, and needs.  Before acting on any information or advice contained, expressly or implicitly, in The BFG Report you should consult a Representative of Baldry Financial Services Pty Ltd trading as BFG Financial Services (“BFG”).

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