Was this really the budget we needed? Our experts deliver their verdicts
Treasurer Jim Chalmers.Credit: Marija Ercegovac
Treasurer Jim Chalmers has announced tax cuts as the headline measure in his fourth federal budget, amid a suite of measures aimed at convincing voters that Labor will better deliver cost of living relief in the upcoming election.
Labor promised $17 billion worth of extra tax relief – worth $268 more in 2026-27 and $536 in 2027-28 more for people earning $45,000 or more – while also promising to scrap non-compete clauses for workers earning less than $175,000 a year.
Five of our experts – Shane Wright, Ross Gittins, Peter Hartcher, Jacqueline Maley and Matthew Knott – break down the economic and political implications of this budget.
Senior economics correspondent
Michele Bullock and her new board of monetary policy experts at the Reserve Bank can breathe a sigh of relief.
Jim Chalmers’ fourth budget could easily have been a pre-election spendathon that stoked any inflationary embers lurking atop kindling in parts of the economy.
The political imperative to buy off voters, particularly with cash handouts, is strong in any prime minister and treasurer facing their electoral reckoning. And the Reserve Bank – which meets next week – is alive to that impulse.
That’s why, when Bullock turns to the budget papers to see how much cash is rushing out of the government’s coffers over the next 15 months, there will be a smile on her face.
Read Shane’s full analysis here.
Economics editor
If you’re having trouble working up much interest in the budget, don’t feel bad. It’s not you, it’s the government. So much fuss is made about the annual federal budget that we expect it to be full of major announcements. Well, not this one, and not from a government that never wants to rock the boat.
It is, however, a budget we’ve wished on ourselves. We’ve made it clear that, while ever we’re feeling pain from the cost of living, we’re not much interested in anything else, and an unambitious government has been relieved to take us at our word.
This government is timid, uninspired and uninspiring. This budget fits it perfectly.
Read Ross’s full analysis here.
Political editor
The federal budget’s headline tax cuts are best described as breadcrumbs.
They’re tiny, one eventually leads to another, and they’re supposed to help guide us out of the dark woods of difficulty onto the safer ground of good times. Good times for Labor, at least, which hopes that this scant offering will clinch them a second term.
How tiny? For a worker on average earnings of $79,000, the first tax cut would be $268, or the equivalent of a pay rise of one-third of 1 per cent. The second tax cut would be roughly twice as much. Even the government describes these as “modest”.
It could have been worse.
Read Peter’s full analysis here.
Senior writer
Forget Paul Keating’s famous invocation of the “recession we had to have”.
This is the budget we had to have when we really didn’t expect to have a budget at all. All federal budgets require some suspension of disbelief. They are based on projections that may never come to be. They contain oodles of measures that may never pass parliament.
But the March 2025 budget plays even more “pretendsies” than usual – few people (including many in the government) bet on it happening.
Read Jacqueline’s full analysis here.
National security correspondent
Call it the “he who shall not be named” budget.
Donald Trump looms over this year’s economic statement like a menacing spectre, threatening to disrupt Australia’s glide path to a smooth economic landing. Yet never once is the US president named in the thousands of pages of explanatory documents. It would be a little rude, after all, to explicitly identify the leader of Australia’s most important ally as the nation’s greatest risk to economic growth.
So the Voldemort strategy it is. Euphemisms are the order of the day; the passive voice proliferates like Paterson’s curse. Readers are left to fill in the blanks.