‘Right now’: Treasurer Jim Chalmers defends Labor’s major power bill promise

In an attempt to neutralise criticism over a key Labor policy, the Treasurer said households needed immediate support.

Energy rebates set to shave off $300 from every household electricity bill are designed to help Australians “right now”, Treasurer Jim Chalmers has claimed, in an attempt to neutralise criticism over Labor’s key $275 power bill cut promise.

Speaking on Wednesday following the federal budget, the Treasurer outlined the Albanese government’s plan to extend and expand subsidies on electricity bills at a cost to the budget of $3.5bn.

“We’ve found a way to help people with their energy bills right now in 2024 when the pressures on,” Dr Chalmers told the National Press Club.

“We have done it in a more substantial way in this budget and it’s a really crucial part of our cost of living package.

The Treasurer has sought to neutralise criticism over a key election promise. Picture: NCA NewsWire / Martin Ollman

“This is all about taking pressure off people and the benefit for every household will be greater than the forecast.”

Ahead of the 2022 federal election, Labor promised to implement an energy plan that could cut energy bills by $275 a year by 2025.

In offering a $300 rebate, the government is provided with some means to defend its promise at the next federal poll even as household power bills are hundreds of dollars higher.

Asked why the $300 rebates were not means tested so that only those who needed the measure the most received it, the Treasurer said existing data sharing arrangements precluded this.

“The two ways that you can (provide energy bill rebates) with the existing systems are either people on pensions and payments, or the whole cohort – every household,” Dr Chalmers said.

The Treasurer said while the ATO had tax information, they had no arrangements to share this data with energy retailers.

“We would have to change, fundamentally, the data-sharing arrangements. That would take time and money,” he said.

Means testing the energy bill relief would take “time and money” the Treasurer claimed. Picture: NCA NewsWire / Ian Currie

“So the judgment that we made was that the most efficient way to give cost-of-living relief to people on low and fixed incomes, but also people on middle incomes, to provide that cost-of-living relief in middle Australia as well, was to provide it to every household.”

A number of economists have been highly critical of the rebates, arguing they threaten to exacerbate already persistent inflationary pressures as households that can cover their electricity expenses themselves will simply spend the money elsewhere, adding to demand.

With Queensland’s state Labor government already offering all households a $1000 rebate, Premier Stephen Miles was on Wednesday spruiking the additional support, claiming that some Queenslanders would not have to fork out for their power bills until mid-2025.

“It’s both Labor governments at a Queensland and an Australian level working together to support Queensland households with the cost of living,” Mr Miles said.

Similarly in Western Australia, $400 in rebates have been announced, bringing the total support to $700.

Originally published as ‘Right now’: Treasurer Jim Chalmers defends Labor’s major power bill promise