INDUSTRY figures have backed state government plans to taper the first home builder grant rather than kill it off.
The $30,000 First Home Builder Boost for people building or buying new homes was launched in November by the former government and was due to finish at the end of the year.
Yesterday Treasurer Peter Gutwein said the grant would now be reduced to $20,000 from January for six months before being halved.
Mr Gutwein said the $10,000 grant would then run indefinitely.
‘‘By tapering the grant over time we will continue to stimulate building activity and create jobs, while also retaining our skilled workforce,’’ he said.
Mr Gutwein, who delivers his first budget this month, said the public would have to wait until then to find out how much the program would cost and how it was being funded.
Treasury figures show the grant cost $8.9 million (296 grants) between November and June.
During this period there were 296 grants paid out of a total of 372 applications.
Master Builders Association Tasmania executive director Michael Kerschbaum said it was sensible for the government to continue the grant as construction would have ‘‘fallen off a cliff’’ if it ceased entirely.
‘‘Having it progressively reduced over a period of time makes sense,’’ he said.
‘‘That transition is really important.’’
Mr Kerschbaum said while $30,000 had been rather generous it did help buffer a building industry that had shed 6000 jobs over three years.
Figures from June show home approvals were now up 37 per cent compared to the same time last year.
Mr Gutwein said the sector was worth $2 billion to the Tasmanian economy, employing some 17,500 people.
GJ Gardiner Homes spokesman Rodney Knowles said the industry was happy to have any degree of assistance.
‘‘It’s $20,000 dollars that people wouldn’t normally have, so it’s fantastic,’’ he said.
The grant began in January 2013 at $15,000 before being doubled to further stimulate sluggish construction in November.