Treasurer Jim Chalmers confirms energy bill rebates will not be extended into 2026
The Treasurer has confirmed Labor’s $150 energy rebate will not continue into next year, with a top economist blaming successive government failures.
Australians will soon be paying more for energy, with a top economist blaming successive governments who collectively were unable to secure enough energy to power the grid.
Treasurer Jim Chalmers has confirmed Labor will not extend its energy rebate relief package into 2026.
The Energy Bill Relief Fund provided a universal $300 household subsidy for the 2024–25 financial year.
The government then extended a $150 subsidy to cover Australians from July this year, with the current offer due to expire on December 31 2025.
Betashare chief economist David Bassanese says everyday Australians were inadvertently being punished for a lack of government investment.
“We have a failure of energy policy in this country and households will pay the consequences of that,” he said.
“The government has been putting a band aid on that failure through this expensive subsidy for a year, but it can’t last.
“It is an inefficient way of protecting households.”
Mr Bassanese says both sides of government are to blame as Australia does not have enough energy to meet demand.
“The transition to renewables seems to be relatively slow, so it is not picking up the slack in the reduction in non renewables,” he said.
“That is because for many years we didn’t really have an energy policy.”
On Monday, Mr Chalmers ruled out a fourth round of the electricity bill rebates, telling reporters the cabinet had come to the “difficult” decision.
“The Commonwealth has spent almost $7 billion on these three rounds of energy bill rebates.
“The states and territories have kicked in another one and a half billion or so,” he said.
“These were a really important way that we provide help with the cost of living.
“But they’re not the only way that we’re providing that cost of living relief for people who are still doing it tough.”
Shadow treasurer Ted O’Brien labelled Monday’s decision as a “budget disaster for all to see”.
“Sound budget management is the bedrock of strong economic management,” he said.
“When you fail to manage the nation’s finances, you lose the capacity to assist those in need.
“That’s why Labor is leaving struggling households to fend for themselves today.”
Mr Chalmers has repeatedly emphasised the rebates should not be seen as a permanent feature of the budget.
Instead, the decision to scrap the package had marked a shift in Labor’s approach to delivering cost of living relief, he said.
“We’ve encouraged people not to see these as a permanent feature of the budget, and the Cabinet has agreed today, decided today, that they won’t be extended into a fourth round,” he said.
“This shift is from temporary measures, first decided when inflation was almost 8 per cent, (to) a shift towards ongoing cost of living help.”
Labor would still provide “considerable” cost of living help, but it would be “permanent and ongoing” through the tax system, through the Medicare system, changes to the PBS, Mr Chalmers said.
“The nature of that cost of living help is evolving over time, but our commitment to providing cost of living relief is constant,” he said.
He also highlighted the second and third round of tax cuts for Australians, from July 1 2026, and July 1 2027, as an example of this ongoing help.
In the first round, Labor will reduce the 16 per cent tax rate to 15 per cent for those earning between $18,201 and $45,000, ahead of a further reduction to 14 per cent the subsequent year.
“We’re providing help with electricity bills via the tax system and by providing other cost of living help, as I’ve said a couple of times now, that cost of living help is changing over time, but our commitment to providing meaningful and responsible assistance is constant,” he said.
“So, the tax cuts will help people pay those bills.”
Originally published as Treasurer Jim Chalmers confirms energy bill rebates will not be extended into 2026
