Federal budget 2025: How mental health was ‘neglected’

Psychologists and psychiatrists have slammed the federal government for ignoring mental health in the budget, saying they are devastated.

Psychologists and psychiatrists have slammed Jim Chalmers’ pre-election budget for “abandoning” mental health.

Cheaper medicine and more bulk-billed doctor visits were the big-ticket health items aimed at wooing voters.

But despite Australia’s mental health system being under significant pressure with experts calling for extra support and better access to affordable psychological services, the government did not unveil any major packages for the sector.

However, budget papers did say the government would provide an additional $46m to continue digital mental health services.

This is free or low-cost support that people are able to access online without a referral.

It is provided by a range of organisations like headspace and SANE Australia.

It also included $1.6m in mental health help for Australians impacted by the Israel-Hamas conflict in the Middle East.

Australian Association of Psychologists Executive Director Tegan Carrison said she was devastated mental health was “abandoned”.

“My heart is breaking for all the families in crisis who had hoped that the government would hear their pleas for support and appropriate funding to get their mental health back on track,” she said.

“It seems the federal government has forgotten we are in the midst of an ongoing mental health crisis.

Mental health was ignored in the budget, psychiatrists and psychologists say.

“The government’s claims that this is the largest investment in Medicare since its creation 41 years ago and continues to ignore one of the key aspects of health – mental health!

“Since when is mental health not considered part of Medicare?”

She said out-of-pocket costs were the highest ever for mental health due to systemic underfunding.

“I would like the federal government to explain to the 4.2 million people in this country who have experienced a mental health disorder in the past 12 months why they have been abandoned.

“We can only hope that in the government’s haste in preparing this budget, someone forgot to include any initiatives to address our crippling mental health crisis.”

President of the Royal Australian and New Zealand College of Psychiatrists, Dr Elizabeth Moore, said there would be disappointment felt right across the mental health sector.

“Once again, mental health is an afterthought. Once again, mental health is the neglected cousin of the health portfolio.

“For another year running, Australians with complex and acute mental health conditions have been overlooked.”

In its pre-budget submission, the RANZCP called for a raft of changes including investing in the mental health workforce, improved access to affordable psychiatric care, and urgent action to meet the growing mental health needs of children, young people, and rural and remote communities.

Peak body Mental Health Australia said the budget showed no commitment to improving access to supports.

Chief executive Carolyn Nikoloski said despite the rising need for greater investment in mental health, this budget suggested that mental health is far from the front of this government’s mind.

“While there are some piecemeal investments, this budget seriously lacks the level of mental health reform and investment that the Australian community expects.

“Everyone in Australia should be able to access the mental health care they need, regardless of their income or where they live.”

Black Dog Institute executive director Samuel Harvey said at a national level there were no announcements about “desperately needed” mental health reform or workforce building.

About 16 per cent of federal government expenditure will be on health in 2025/26, including for the PBS and Medicare.

This is what the budget means for you with your health:

More bulk billing when you go to the doctor

About $8.5bn will be poured into making visiting the doctor cheaper for every Australian.

The government will also aim to increase the bulk-billing rate to 90 per cent over the next five years.

The Coalition earlier this year promised to match this previously-announced health promise.

A bulk-billing incentive payment was first introduced by Labor about 18 months ago but it only applied to pensioners, concession cardholders and children under 16.

This major change will start from November 1.

The federal budget is committing $8.5bn to try to increase bulk-billing rates.

It means GPs who bulk-bill their patients will get an incentive on top of the standard $42.85 rebate.

Clinics where all patients are bulk-billed will get an additional 12.5 per cent bonus.

In his budget speech, Treasurer Jim Chalmers said he was proud to make “the single largest commitment to Medicare since its creation”.

“Because of this investment, nine out of 10 GP visits should be fully bulk billed by the end of

the decade,” he said.

Doctors have expressed some doubt that will happen.

Cheaper medicine

The maximum price of a PBS script will be slashed from $31.60 to $25, making medicine more affordable for everyone.

This 20 per cent cut is estimated to save households $200m a year and will take effect from the start of 2026.

Pensioners and concession cardholders will continue to pay $7.70 a script due to a freeze on their costs that will remain in place for another five years.

Treasurer of Australia Jim Chalmers focused on cheaper medicine and bulk-billed doctor visits in his speech.

More medications will also be listed on the PBS at a cost of $18.bn.

That includes a drug to treat metastatic breast cancer, a new treatment for patients with prostate cancer who have the BRCA1 or BRCA2 mutations and a nasal spray for people with treatment‑resistant major depression.

The Coalition has also promised to lower PBS prices down to $25.

More urgent care clinics

There will be more urgent care clinics to visit if you’re unwell and can’t wait for a regular GP appointment but don’t need to visit the emergency department, with the federal budget putting $644m towards opening 50 more around Australia.

During the 2022 election, urgent care clinics were a key promise from Labor.

The government has since opened up 87.

They’ve set the ambitious target of the extra 50 being up-and-running by next financial year.

“Four in every 5 Australians will live within a 20-minute drive of an urgent care clinic,” Mr Chalmers said in his speech.

More affordable contraception and menopause treatment

Women will find it easier to access contraception or get menopause treatment under a $792.9m boost for female health in the federal budget.

This includes new contraceptive pills being added to the PBS for the first time in 30 years and larger Medicare rebates to get IUDs.

Menopause health assessments will also receive bigger rebates and three new menopause drugs, including Estrogel, will also be added to the PBS.

Women with endometriosis will get a subsidised drug that reduces pain.

Eleven new pelvic pain clinics will be opened to help improve the astoundingly long diagnosis times for the common and debilitating condition that takes years to diagnose.

Aged care nurse pay boost

The government will put $2.6bn over the next five years towards a pay boost for 60,000 aged care workers.

The funding is a result of the Fair Work Commission’s decision to increase minimum wages.

Aged carre nurses will get a pay rise after it was ordered by the Fair Work Commission.

“So the workers we trust to care for our parents and grandparents get paid properly for the

work they do,” Mr Chalmers said.

But there’s no extra money for more than 82,000 older Australians needing home care.

It does include $300m to be spent over five years on reforming the sector and fulfilling Royal Commission recommendations.

Funding to trial “multidisciplinary outreach care” for aged care residents has been slashed. Last budget, the government had $10.3m allocated for the program annually this and next financial year.

However the funding has been cut and papers confirmed this would contribute to “(achieving) savings of $21.2m over three years from 2024–25”.

Hospital cash splash

The government has committed an additional $1.8bn to fund public hospitals and health services in 2025–26, with the cash splash hoped to cut hospital waiting lists, reduce waiting times in emergency departments, and ease ambulance ramping.

The federal government’s contribution to state-run public hospitals will increase by 12 per cent to reach a record $33.9bn in 2025–26, according to budget papers.

The documents said funding for public health and hospital services under the National Health Reform Agreement represented the largest specific purpose payment to the states, followed by Better and Fairer Schools funding.

If you’re on a low income you’ll pay less of the Medicare levy

More than a million people on low incomes will benefit from the government changing the Medicare levy low-income threshold come tax time.

The 4.7 per cent increase on how much someone needs to earn before the levy kicks in means some pensioners, families, singles and seniors will either be exempt from paying the charge or they’ll pay less.

For singles, the threshold will begin to phase in from $27,222 this financial year instead of $26,000.

The full 2 per cent levy will also now kick in from $34,027 instead of $32,500.

That means someone earning between $29,000 and $32,000 will be the biggest winner, saving $122 in tax.

A million low-income earners will get slight reprieve from the Medicare levy.

But once they hit $35,000 they’ll see no change.

Pensioners and single seniors earning less than $43,000 will also avoid paying the levy, which previously started from $41,089 for this cohort.

For families the levy will now phase in from $45,907 instead of $43,846.

The increase to the Medicare levy low-income thresholds will cost $648m over the next four years.

Bid to help smokers and vapers kick habit

The government says, if re-elected, it will provide $156.7m over two years to strengthen compliance and enforcement action around the trade of illicit tobacco and nicotine products.

Public servants from a range of agencies will work together, with the crackdown set to “help protect Australians from poorer health outcomes and cut off revenue to criminal gangs”.

And the government would also continue funding smoking and vaping cessation activities, like scaling up Quitline capacity, with $5.5m next financial year, and $4.5m the following.

Originally published as Federal budget 2025: How mental health was ‘neglected’