Billions in cost-of-living relief coming in matter of weeks

Saturday, 15 March 2025 07:34

The federal budget will be handed down in less than a fortnight. This is what you're going to get in it.

Australians can expect another significant boost to cost-of-living relief in the next federal budget as the government gears up for an election in May.

While it had been presumed for months that an expected early election would get in the way of the budget, Tropical Cyclone Alfred delayed the calling of the vote, meaning Treasurer Jim Chalmers will have to hand down the national accounts as scheduled on March 25.

Because of that, there have been far fewer early announcements than in previous years, and what new measures will be handed down by the government remains a bit of a mystery.

Pedestrians on Bourke Street in Melbourne.

However, there have still been some hints from senior ministers about what to expect, as well as some earlier announcements that will form part of the 2025 budget.

Here's what you can expect on March 25.

Massive student debt discount

The roughly 3 million Australians who have student debt will get a welcome boost on June 1 when their outstanding balances are cut by 20 per cent.

The one-off discount represents a massive $16 billion in student debt reduction – more than five times larger than last year's move to retrospectively lower the indexation applied to those debts.

The new measure was announced by the government as an election promise in November, and will now need to be factored into this year's budget.

General scenes of students on Sydney University campus.

Energy bill relief

The centrepiece of last year's budget was the $3.5 billion in energy bill relief – a $300 rebate, spread over the course of the financial year, for every household in the country.

Although the government has not given a cast-iron commitment to extending that policy, there are hints something similar could be on the way this year, particularly after the national energy regulator approved price increases of up to 9 per cent from July 1.

After that decision, Energy Minister Chris Bowen was asked whether repeat rebates would be on the cards.

"As the prime minister, the treasurer and I have made clear, we will always consider what more can be done," was his reply.

Anthony Albanese and Jim Chalmers in parliament.

"There's a budget coming soon, and we'll continue that approach of considering what more we can do."

Albanese also mentioned energy subsidies when he was asked on March 9 about what cost-of-living relief could be expected in the budget.

"We will always do what we can to assist people," he said.

"That is one of the defining characteristics of my term of government, is that we were saying yes to energy bill relief, yes to tax cuts for all Australians, yes to cheaper child care, yes to free TAFE, yes to providing a range of support, including lifting rental assistance by 45 per cent over two budgets."

Subsidised childcare for everyone

That cheaper childcare Albanese mentioned will also feature heavily in the budget.

Like the student debt discount, this was an election promise unveiled in late 2024, well after the last budget: three days a week of subsidised childcare to families with a combined income of less than $530,000 a year.

The activity test will also be scrapped to make it easier for low-income parents to access cheaper childcare, a measure recommended by the Productivity Commission and long called for by economists.

The policy will come into effect on January 1, 2026, if Labor wins the federal election, and will cost $427 million over five years.

Prime Minister Anthony Albanese and Minister for Education Jason Clare at a childcare centre.

Boost for Australian-made goods as tariffs hit

One of the big economic uncertainties plaguing financial markets at the moment is US President Donald Trump's explosion of tariffs.

Australia has been hit by Trump's 25 per cent tax on all steel and aluminium imported into the United States, and while we shouldn't expect a retaliatory tariff in the budget – that was ruled out by Albanese – there's set to be some kind of response.

Local manufacturers fear a flood of cheap, international produce onto the Australian market from all the other nations who have also been denied free access to American consumers, which would be a significant business challenge.

Albanese has flagged support for local industry will be handed down.

"In the March budget, we'll provide additional support for our 'Buy Australian' campaign which we'll be announcing as part of the budget process," the prime minister said in his press conference responding to the introduction of Trump's tariffs.

EXPLAINED: How hard Trump's tariffs will hit the Australian economy

As a result of the earnings jump, the company said it can now mix investment, acquisitions and shareholder returns.

Other announcements

There are a number of other policies that will form a part of the 2025 federal budget, including:

A new $1 billion fund to build and expand early education centres
$1 billion to reserve land for a future rail line linking Western Sydney Airport with south-west Sydney suburbs

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