Australian news and politics recap: Treasurer Jim Chalmers delivers fourth Federal Budget

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The Nightly’s special Budget edition is out now. Read it ​here​.

Anthony Albanese and Jim Chalmers don’t want a national security election, that much is clear, The Nightly’s Latika M Bourke writes in her Budget analysis.

“The Prime Minister and Treasurer correctly assess Australians are voting on the cost of their groceries, mortgages and electricity bills,” Bourke writes.

“They will, overwhelmingly so. Which is why Tuesday’s Federal Budget is a politically savvy document crafted to get Labor over the line for the election in May.

“It may just work. Labor is pouring money into Costello-esque tax cuts, and funding health services.”

But, Bourke writes, the Budget is predicated on the idea that the global environment doesn’t change between now and election day, which is either May 3, 10 or 17.

“That’s a very big wager given the White House is occupied by a brutal and often capricious Trump Administration that sees little distinction between foes and allies and could lob even more tariffs on Australia at any point in time,” she says.

Read Latika’s full analysis here.

Jim Chalmers’ 2025 Budget has provided the foundation for the Labor Party’s election campaign, and a shot at a victory that seemed to be slipping from its grasp a few months ago.

The document is so carefully framed for the political moment that it could turn the Treasurer into the prime minister-in-waiting.

A week after lowering expectations he had much to offer in Tuesday’s Budget, Dr Chalmers sprung a surprise on the Coalition and the Australian people: a $17 billion election-eve tax cut.

Which means the Budget the Government apparently did not want has provided it with what could be the most potent promise of the campaign.

Does it matter that the Budget next year will be $42 billion in deficit and the nation will owe $1 trillion? Or the Government spends more than one quarter of every dollar in the economy?

Of course not! There’s an election to win!

Read the full analysis here.

The Nightly’s Nicola Smith writes the Government’s modest tax cuts are about assuaging voters with cost-of-living relief at a time of rising global uncertainty.

But Treasurer Jim Chalmers has also handed down books that have entered the red with a $42.1b deficit and debt projected to exceed $1 trillion in the 2025-26 financial year.

On the eve of the Federal Election, the Government will be counting on voters overlooking forecasts of a decade of deficits by adding $17b in tax cuts to already announced sweeteners that include $1.8b in energy bill relief, a beefy $8.5b fund to expand Medicare bulk-billing and more affordable housing.

The plan, against a backdrop of global turmoil from ongoing conflict in the Middle East and Europe, slow growth in China, and a potentially turbulent trade tariff war, will see every Australian taxpayer receive two rounds of tax cuts on top of relief already being rolled out since July 2024.

According to Treasury figures, the tax cuts will not kick in until next year when every Australian taxpayer, regardless of income, will receive a cash boost of up to $268 in 2026-27, followed by up to $538 in 2027-28 – all relative to 2024-25 tax settings.

The combined relief is expected to deliver an average cut of $2458 in 2027-28, which translates to around $50 per week.

Read the full story

An upbeat Chalmers declares the Labor Government have repaired the Budget without ignoring its responsibility to build a stronger, fairer and more inclusive society.

He said more Australians now have the chance to contribute and share in the nation’s economic success.

Mr Chalmers said it was remarkable that Australia’s economy was turning the corner while the global economy was taking a turn forthe worse.

“Our progress and our prospects validate and vindicate the decisions and the sacrifices that we’ve made together as Australians.

“To bring inflation and debt down, to get wages and growth up, and to keep unemployment low.

Mr Chalmers said it was now important to “finish the fight against inflation”.

“To keep rebuilding living standards and how we maximise our national advantages to benefit middle Australia.

“The plan at the core of this Budget is about more than putting the worst behind us, it’s about seizing the best of what’s ahead of us.

“To build a stronger economy together, and to build a future that we can all be proud of, and that’s why I commend this bill and this Budget to the House.”

Mr Chalmers declared tonight’s budget was $207 billion better than what the Labor Government inherited.

“It’s in better shape in every year over the Forward Estimates than it was three years ago.

“In our first two years, we posted the first back-to-back surpluses in nearly two decades.

“Our deficit this year has almost halved since we came to office. Next year’s deficit is $42b lower than what was forecast at the last election, and lower than at the mid-year update.

“Gross debt will hit $940 billion this financial year, $177 billion lower than what we inherited.

“This means we will avoid around $60 billion in interest costs over the decade.

“These are some of the dividends of our responsible economic management, achieved through a combination of spending restraint, finding savings and banking revenue upgrades.”

Mr Chalmers said an additional $50 billion will be invested in defence by the mid-2030s.

“It means Defence funding will grow beyond 2.3 per cent of GDP by the early 2030s.

“And we’re investing $45 million in our initial response to the independent intelligence review.”

Mr Chalmers’ said he wanted to buildon the strength of our regions by securing banking services in country towns and flights.

“It is also why we are investing up to $3 billion in additional equity to complete the rollout of the national broadband network.

“Infrastructurelike the NBN is essential for communities and students and businesses, and to the productivity of our nation, and so are the roadsand railways connecting our regions to our cities and supporting economic growth.

“This Budget provides $17.1 billion over 10 years for these projects, including $7.2 billion to upgrade the Bruce Highway in Queensland, $2.3 billion for Western Sydney with $1 billion of that for the rail network, and $2b towards transforming Sunshine Station, taking our Melbourne Airport rail investmentsto $7 billion.”

Mr Chalmers has vowed to abolish non-compete clauses, saying they are holding too many Australians back from switching to better, higher-paying jobs.

“More than three million Australians are captured by these clauses, including child care workers, construction workers and hairdressers.

“People shouldn’t need to hire a lawyer to take the next step in their career, or permission from their old boss if they want to be their own boss and turn an idea into a small business.

“The Productivity Commission estimates that this reform could lift productivity, reduce inflation and improve GDP by $5 billion, and it could boost wage sby up to 4 per cent.”