Federal budget winners and losers: Who came out best and who was left wanting

Addressing cost-of-living pressures was at the forefront leading into the federal budget.

Treasurer Jim Chalmers handed down his third budget on Tuesday night, describing it as a budget that helped struggling Australians while investing in the country’s future.

Cost-of-living relief and inflation were the hot topics, as the government promised measures to ease pressures while spending with restraint.

The treasurer has repeatedly said he has kept inflation in mind when crafting the budget.

“Responsible relief that eases pressure on people and directly reduces inflation,” he said.

Winners

Low and middle-income earners

Australian households are struggling under cost-of-living pressures, with Finder’s cost of living pressure gauge, which measures the financial burden on Australian households, hovering in the “extreme” range for the past year-and-a-half.

Addressing cost-of-living pressures was the “number one priority” of the government — and the stage three tax cuts will play a key role in that, Chalmers said.

While all taxpayers are set to see a boost to their take-home pay under the stage three tax cuts, low and middle-income earners will see the most benefit.

Announced earlier this year, the cuts will give, on average, taxpayers an extra $36 per week in 2024-25.

By 2034-35, someone earning an average income will pay $21.915 less tax.

“From July 1, all 13.6 million taxpayers will get a tax cut,” Chalmers said.

“And for 84 per cent of taxpayers, and 90 per cent of women, a bigger tax cut than they would have had under the previous government.”

Students

More than three million Australians will save on average about $1200 when $3 billion in student debt is wiped out.

Thousands of dollars will be wiped from student loans, as the government overhauls how HECS debt is indexed.

Indexation will be capped to the lower of the Consumer Price Index or Wage Price Index.

While the measure is a good first step, more needs to be done, according to the National Union of Students.

“The reality is that even under this change, tertiary students will continue to get a raw deal,” NUS National President Ngaire Bogemann said.

Thousands of students will also benefit from being paid for their compulsory work placements.

From July 2025, about 68,000 students at university and 5000 in vocational education and training will be eligible for a $319.50 weekly payment in addition to income support they may already receive.

The payments will be means tested and at this stage, only apply to teachers, nurses and social workers, meaning other students who undertake placements including psychology and medicine, miss out.

Parents

Superannuation will be paid to parents on paid leave, with about 180,000 families to benefit annually.

In a move to close the superannuation gap, the government has said parents will receive 12 per cent superannuation or about $106 a week on their publicly funded paid parental leave from July 2025.

“When it comes to those first months of your child’s life, you can’t put a price on being there,” Chalmers said.

“And you shouldn’t pay a price for being there.

“This will make the super system fairer, reduce the gender gap and benefit 180,000 families a year.”

Households

With the cost of living at the forefront of Tuesday’s budget, the government has announced an energy bill support payment to alleviate pressures.

From July 1, more than 10 million households will receive a $300 rebate on their energy bills.

Small businesses

Small businesses will also benefit from the power bill relief payment, with one million to receive a boost of $325.

In another win, the $20,000 instant asset write-off is being extended, meaning small businesses that turn over less than $10 million annually can immediately deduct eligible assets costing less than $20,000 until June 30, 2025.

Businesses will also benefit from the government abolishing 457 nuisance tariffs that will simplify the country’s trade system and cut compliance costs.

A further $10.8 billion will be invested into supporting the mental health and financial wellbeing of business owners by extending a program providing tailored, free mental health support and extending the small business debt helpline.

Aged care workers

The government has committed to fund the Fair Work Commission’s decision to increase award wages for aged care workers once the final determination is made.

“We have provisioned for a wage increase for childcare workers as well,” Chalmers said.

Renters

Australians on rent assistance will receive a helping hand, with the government committing $1.9 billion to increase the maximum rates of Commonwealth Rent Assistance — a fortnightly supplement of up to $250 for welfare recipients who rent — by 10 per cent.

The government has also committed to building more homes for Australians, fund infrastructure that supports more homes and deliver loans to help build more social and affordable housing.

Women

As announced ahead of the budget, the government is investing almost $1 billion to make a $5000 payment for women fleeing violent relationships permanent.

Another $56 million will be provided to improve access to a raft of women’s health services.

Women will also benefit from higher rebates for longer specialist consultations for patients with endometriosis and complex gynaecological conditions to access appointments.

Last-minute travellers

Disorganised holidaymakers will be able to fast-track their passport applications from July 1 for a price.

People can fork out $100 to skip the queue and access a five-day turnaround for their new passport.

The measure is expected to generate $27.4 million over five years.

Music festivals

Australia’s struggling music festival industry has been offered a lifeline.

The budget will provide $8.6 million to support live music venues and festivals that showcase Australian talent, as the industry verges on collapse.

PBS patients

Australians using the Pharmaceutical Benefits Scheme will have access to more affordable medicine.

The government will introduce a one-year freeze on the maximum patient co-payment for everyone with a Medicare card, instead of prices rising with inflation.

“This year and next year, no-one will pay more than $31.60,” Chalmers said.

Pensioners and other concession cardholders will benefit from a five-year freeze, meaning they will not have to pay more than $7.70/ the maximum cost of PBS.

Another $3.4 billion will be invested to add life-saving medicines to the PBS, cutting the cost of one breast cancer treatment from about $100,000 to just $31.60, Chalmers said.

Losers

High-income earners

The original stage three tax cuts were skewed more heavily towards higher-income earners.

Under the changes, higher-income earners will still see a boost to their payslip, but not as much as before Labor’s changes.

Welfare recipients

Calls were mounting for the federal government to substantially lift JobSeeker and Youth Allowance payments in the budget as cost-of-living pressures bite.

The Australian Council of Social Services asked the government to implement the Economic Inclusion Advisory Committee’s recommendation to increase JobSeeker and related payments to 90 per cent of the pension rate – $72 a day – to help people afford essentials.

“More than one million people in Australia relying on JobSeeker and related payments are barely surviving on deeply inadequate income support,” ACOSS CEO Dr Cassandra Goldie said.

The Greens also echoed this call, urging the government to lift all income support above the poverty line.

The government did announce support for Australians with additional barriers to finding work by providing $41 million to extend the eligibility for the existing higher rate of JobSeeker.

This is expected to provide a boost of at least $54.90 per fortnight to eligible recipients who can only work up to 14 hours per week.

However, calls for welfare payments to be increased overall were not answered.

International students

Universities will be required to stop the surge in international students under the government’s plans to cut back annual migration.

Chalmers said enrolments were growing without being matched in housing supply.

“If universities want to take more international students, they must build more student accommodation,” he said.

“We will limit how many international students can be enrolled by each university based on a formula, including how much housing they build.”