The Energy Bill Relief Fund, which provided much-needed assistance to households across the country, will not be extended beyond its current expiry date in 2025. This confirmation comes directly from Treasurer Jim Chalmers, marking a significant shift in the government’s approach to tackling cost-of-living pressures.
The existing scheme, designed to alleviate the burden of rising energy costs, has been providing a $300 rebate to every household throughout the 2024-25 financial year. This rebate is distributed in four quarterly installments of $75 each, offering regular and consistent support to families. The scheme is slated to conclude on December 31, 2025, and, according to Treasurer Chalmers, there will be no further extensions.
“There have been three rounds of electricity bill rebates and there won’t be a fourth,” Chalmers stated, emphasizing the government’s decision to move away from temporary relief measures. He further elaborated on the substantial financial commitment already made to the scheme, stating that “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.”
While acknowledging the importance of these rebates in providing immediate cost-of-living assistance, Chalmers emphasized that they were intended as a temporary measure, particularly when inflation rates were significantly higher. “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,” he explained.
The government’s strategy is now focused on implementing long-term, sustainable solutions to address the underlying causes of cost-of-living pressures. According to Chalmers, “This shift is from temporary measures, first decided when inflation was almost 8 per cent, to a shift towards ongoing cost of living help.”
This “ongoing cost of living help” will be delivered through a variety of initiatives, including:
- Tax Reforms: The government is implementing significant tax reforms aimed at increasing disposable income for Australian workers.
- Medicare Improvements: Investments in Medicare are intended to reduce healthcare costs for individuals and families.
- Pharmaceutical Benefits Scheme (PBS): Lower prices for medicines under the PBS will make essential medications more affordable.
A key component of the government’s long-term strategy is the implementation of previously announced tax cuts. These cuts are scheduled to take effect in two phases:
- July 1, 2026: The tax rate for earnings between $18,201 and $45,000 will be reduced from 16 per cent to 15 per cent. This is projected to save workers up to $268 per year.
- July 1, 2027: A further reduction to 14 per cent will be implemented, effectively doubling the annual savings to $536 compared to current tax settings.
To illustrate the impact of these tax cuts, Chalmers provided an example: “For someone earning $40,000, that means an extra $436 in their pocket from 2027–28, on top of earlier cuts.”
Chalmers reiterated the government’s commitment to providing meaningful and responsible assistance to Australians facing cost-of-living challenges. “So they are a good illustration of the shift that we have engineered from temporary help with the cost of living to permanent help with the cost of living delivered through the tax system,” he stated.
He further emphasized that the government is providing assistance with electricity bills not only through the tax system but also through other cost-of-living measures. “We’re providing help with electricity bills via the tax system and by providing other cost-of-living help.”
In conclusion, while the Energy Bill Relief Fund will not be extended, the government maintains that its commitment to providing cost-of-living assistance remains steadfast. The focus has simply shifted from temporary rebates to long-term, sustainable solutions aimed at addressing the root causes of financial pressures faced by many Australians. “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,” Chalmers affirmed.