Where will the budget’s billions be spent?

Treasurer Jim Chalmers and Prime Minister Anthony Albanese are preparing to deliver their fourth budget in just three years. We’ll find out exactly what’s in it once reporters are let out of the lock-up in Parliament House on Tuesday evening, but here’s what we already know. 

Health 

In what’s likely to be a centrepiece of the budget, the government has promised an $8.5 billion boost for Medicare. The money will go towards expanding bulk billing, with another $689 million pledged to reduce the maximum cost of many medicines. 

Cost of living

Chalmers has promised to expand energy bill subsidies until the end of 2025. The subsidies will wipe $150 from power bills for households and some small businesses through the second half of 2025 at a budget cost of $1.8 billion.

Infrastructure 

The government plans to reserve land for a future rail line connecting the new Western Sydney Airport with areas in southwest Sydney, setting aside $1 billion for the project.

Queenslanders have been promised upgrades to the Bruce Highway worth $7.2 billion.

In Victoria, Labor has pledged $7 billion to upgrade roads and rails.

Defence

Military initiatives such as producing new radars, increasing supplies of long-range missiles and strengthening AUKUS supply chains will cost $1.1 billion. Australia’s spy agencies will also get an extra $45 million.

Housing

Labor has pledged to increase its equity investment in the so-called Help to Buy scheme by $800 million (from $5.5 billion to $6.3 billion). It will also invest $54 million in support of prefabricated and modular home construction.

Alcohol

The budget is expected to confirm a two-year freeze in increases to the draught beer excise indexation at a taxpayer cost of $200 million.

Tariffs

Treasury estimates say US tariffs on Australian steel and aluminium exports will translate to an indirect hit to GDP of 0.1%. Part of the government’s response involves a campaign to urge consumers to buy Australian goods, and although that campaign is expected to form part of the budget, no dollar figures have been put on it so far.

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