Key Hunter advocates are pushing for progress on housing supply, clean energy and education in Tuesday's federal budget to set up the region for economic prosperity.
Treasurer Jim Chalmers will hand down the Albanese government's last budget before the next federal election on Tuesday night.
The government has already announced that it will use the budget to promote its signature Future Made in Australia subsidy program for domestic manufacturing and a new $9.3 billion agreement with the states to increase and improve social and crisis housing.
For regional advocacy groups such as Committee for the Hunter and Business Hunter, more housing, training, education and clean energy go hand in hand with an orderly economic transition away from coal.
The organisations recognise that some major Hunter infrastructure projects, including the M1 Motorway extension, Newcastle Inner City Bypass and Newcastle Airport terminal upgrade, have been funded.
Now their focus has turned towards housing and educating the workforce that will drive the Hunter's future in clean energy production, manufacturing and research.
Business Hunter chief executive Bob Hawes said the state and federal governments should establish an Institute of Applied Technology (IAT) in the Hunter focusing on clean energy.
Two pilot institutes have opened in Sydney specialising in digital and construction technology as partnerships between TAFE, universities, industry and the Department of Education.
"There is particular interest in the Hunter, where substantial infrastructure investment and renewable energy initiatives are projected to lead to huge demand for skilled workers," Mr Hawes said.
NSW Department of Education figures show about 45 per cent of school students in the Hunter and Central Coast do not complete year 12, 24 percentage points below the national average.
Committee for the Hunter chief executive Alice Thompson said tertiary education levels were "one of the bluntest indicators of success in modern economies".
"High school completions and tertiary education rates across the Hunter remain stubbornly below Australian and NSW averages," she said.
"This is not explained by the region being small, remote or lacking in resources."
Ms Thompson said the federal and state governments should partner with industry, business, education and research institutions on a program to raise educational outcomes and "build the workforce our changing economy needs".
"There is strong alignment across local stakeholders and experts for new, compressed learning pathways that cross high schools, vocational, tertiary, industry and research to build a pipeline of job-ready graduates.
"This includes programs, but there are also bricks-and-mortar solutions to get that level of integration."
Ms Thompson said TAFE's proposed centres of excellence, one of which the NSW government has promised for the Hunter, were a "starting point" for producing a pipeline of workers for clean energy industries.
"We are looking for strong involvement from the University of Newcastle in design, decisions and delivery to get the best outcomes from a Hunter centre of excellence that we hope to see in this year's budget," she said.
The federal government's National Housing Accord with the states has set a target of building 1.2 million homes over the next five years, though building approvals remain below average.
NSW aims to build 377,000 of those homes under the accord.
The government announced last week that it would provide an extra $90 million for another 20,000 fee-free TAFE and pre-apprenticeship places to help address a shortage of tradespeople across Australia.
Ms Thompson said labour costs and availability were driving up the price of new homes, while lack of funding in roads and other infrastructure was holding up supply.
"In the Hunter, housing is an enabling infrastructure rather than a planning reform problem, and we continue to advocate for funding to address this key constraint to more homes in the region," she said.
She said the budget should include "more definition" around projects and programs to grow a diversified Hunter economy under the proposed Net Zero Economy Authority.
"This includes investments in major infrastructure and precincts that catalyse new jobs and business in sectors the Hunter is good at, including health, defence and clean energy."
She said the government needed to work harder to "level the playing field" with the huge US Inflation Reduction Act, which is sucking up global investment in clean energy.
"First and foremost this includes securing additional clean energy supply for our burgeoning hydrogen industry, in addition to replacing current generation capacity.
"We know what closing the IRA gap in the Hunter looks like. We are now looking to the federal and state budgets for action."
The government has already committed $100 million to enabling infrastructure at Port of Newcastle's planned clean energy precinct on Kooragang Island.
Mr Hawes said interest from international trade delegations and consular offices in Hunter energy, research, manufacturing and technology was "unprecedented" but business sentiment was depressed due to high insurance, tax and energy costs.
He said "slow" progress on building wind and solar energy projects had left businesses facing an "undesirable confluence of rising prices and thinning reliability margins".
"Across renewables, extensive investments are needed to grow capacities in line with demand and avoid large-scale imbalances between supply and demand," he said.
Mr Hawes hoped the spread of "disinformation" about the Hunter offshore wind zone would not derail the project.
He said the state and federal governments should progress planning, funding and development of the Lower Hunter freight rail bypass after Transport for NSW finalised the route in December 2022.
Separating freight trains from passenger services would encourage housing development along the existing line and could help the High Speed Rail Authority plan the bullet train to Sydney.
The government has handed the HSRA $78.8 million to prepare a business case on the high-speed rail line by the end of the year.
Mr Hawes said the $450 million Muswellbrook bypass, a project delayed last year after the federal government reviewed projects in the infrastructure pipeline, was also a budget priority for the Hunter.
"This project is vital to the Hunter's progress, cutting congestion and improving safety for the 10,000 motorists and truck drivers who use this route each day," he said.
Mr Hawes also called for the state and federal governments to fund the second stage of the John Hunter Hospital redevelopment.
- The Newcastle Herald will report from the budget lock-up in Canberra on Tuesday.
