Budget 2025–26: Is Australia Spending Smart — or Just Spending?

This year’s Federal Budget delivers widespread support: tax cuts, energy relief, rent assistance, homebuyer incentives, free TAFE, universal early learning and green energy investment. There’s no doubt many Australians will benefit from these initiatives — and the intent to ease pressure is clear.

But it’s worth asking: Are these measures sustainable? Or are we simply spending now and worrying about how to pay for it later?

This blog isn’t about criticising any government. It’s about looking at the numbers — like any household or business owner would — and asking: Where’s the return on this investment?

🔍 What’s in the Budget?

🏡 Housing & Home Buyers

  • Up to 40% equity contribution from the government through the Help to Buy scheme

  • Ban on foreign buyers of established properties for 2 years

  • $21 billion in housing supply and infrastructure

  • Build-to-rent incentives and construction workforce support

💡 Cost of Living

  • $150 one-off energy rebate for all households

  • $150 rebate for ~1 million small businesses

  • Stage 3 tax cuts for every taxpayer from 1 July 2024

  • 20% student debt reduction + fairer repayment thresholds

  • Boost to rent assistance and cheaper PBS medicines

🧒 Education & Healthcare

  • $5 billion for universal early learning — 3 days subsidised care/week

  • Permanent Free TAFE

  • $3.6 billion in pay rises for aged care and childcare workers

  • Expansion of bulk billing and urgent care clinics

🏢 Small Business

  • Energy efficiency grants (up to $25,000)

  • Pause on beer excise indexation

  • Strengthened Franchising Code enforcement

  • Digital and cyber support initiatives

🌱 Environment, Energy & Industry

  • $22.7 billion Future Made in Australia clean energy and manufacturing strategy

  • $13.7 billion in production incentives (hydrogen, low-carbon fuels, minerals)

  • $1.5 billion for major clean energy projects

  • $3 billion to complete NBN rollout

👮 Crime, Justice & Community Safety

  • Mental health support for emergency service workers

  • Natural disaster response and recovery investment

  • But no new national funding for police, crime prevention, bail reform or youth justice programs

🏠 The Real Cost of the Home Buyer Scheme

The Help to Buy scheme allows buyers to purchase a home with a small deposit and government co-ownership. But when you sell or refinance, you repay the same percentage of your property’s value — not the original dollar amount the government contributed.

Example:

  • Home bought for $600,000

  • Government contributes 40% = $240,000

  • Home grows to $977,000 after 10 years

  • Government’s share owed = $390,800

That’s $150,800 more than they originally put in — even though you paid the mortgage, maintenance, and costs.

You can buy back portions over time, but only based on current value, not what you started with. It’s not a loan — it’s shared ownership, and the government takes its share of your future upside.

🏢 Small Business: Overlooked Again

While sole traders may benefit from minor tax cuts and one-off rebates, most small businesses — especially those employing staff — were largely overlooked.  There is still no:

  • Payroll tax relief

  • Hiring or retention incentives

  • Help with rising insurance, wages or compliance costs

Yet these businesses are the biggest employers in the country — and many are already doing it tough.

🧍 Landlords & Property Investors: No Support, More Risk

Renters get assistance, but landlords — who provide essential housing stock — are under mounting pressure:

  • Tighter eviction rules

  • Limits on rent increases

  • Tenants falling behind on rent multiple times with no consequence

  • No financial hardship relief if mortgage payments fall behind due to tenant default or damage. Credit Reports are affected.

There’s no safety net for landlords. And no real plan to encourage investment in long-term, affordable rental supply. 

👮 Community Safety: Still Waiting

While the budget includes mental health support for emergency services (which is crucial), there’s a glaring lack of investment in actual crime prevention.

No new commitments to:

  • Frontline police resourcing

  • Bail reform or justice system reform

  • Youth crime intervention

  • Reducing repeat offending

Our emergency workers are doing it tough — but so are communities. Funding counselling is great, but stopping crime before it happens should be the priority.

💸 $150 Energy Relief = $1.4 Billion Spend

The $150 rebate sounds generous — until you do the math:

  • 9.275 million households Plus Business

  • = $1.776 billion

For most families, This is a very short term saving. But to the budget, it’s a huge spend — especially when we’re not running a surplus.

So where’s the money coming from?

  • Likely borrowed (adding to national debt)

  • Or pulled from other services

  • Or returned later via higher taxes or reduced services

Would a business spend $1.4 billion on something that doesn’t fix the problem long term? Probably not.

💰 Stage 3 Tax Cuts: Who Wins, and at What Cost?

The reworked Stage 3 tax cuts take effect from 1 July 2024:

  • Everyone earning over $18,200 will receive a tax cut

  • $73K income = approx. $1,504/year saving

  • $100K–$135K = $2,179–$2,664

  • $200K = $3,729 saving

These are permanent, meaning government revenue shrinks — every year.

Cost to the country:

  • $20.4 billion in 2024–25

  • Over $300 billion over the next decade

This is one of the most expensive parts of the entire budget — and it comes on top of major spending increases across housing, education, energy, and healthcare.

🤔 Final Thought: Is This Good Business?

This budget feels like it’s trying to do everything at once — spend big, cut taxes, and support every voter segment. And in the short term, many Australians will welcome the relief.

But there’s a saying that comes to mind:

“It’s like putting everything your kids want on Afterpay — they’re happy now, but you’ve just locked in the repayments you cant afford for a long time.”

That might be what’s happening here.

Generosity is easy in an election year. But running a country is like running a business — you need to balance your books, invest wisely, and think beyond the next quarter.  This budget lacks a long-term strategy. It cuts income, increases expenses, and adds debt, with no clear plan to balance the ledger later.

Everyone’s entitled to their own view — and this is just one. But if we want better outcomes for families, businesses, landlords, and frontline workers, we need more than feel-good policies. We need good planning.

This article is general in nature and does not constitute financial advice. Please seek independent legal or financial advice before making decisions.

📄 For more detail, visit the 2025–26 Federal Budget Overview