After delivering back-to-back budget surpluses, Labor Treasurer Dr. Jim Chalmers has this year handed down a budget in deficit. Watch Canberra Times political analyst Mark Kenny and political and public service reporter Brittney Levinson provide a breakdown of key commitments, surprises and omissions in the 2025-26 budget including who gets what.
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00:00It's a plan to build Australia's future, with more homes, new investments in skills
00:05and education, competition reforms and a future made in Australia.
00:10Well, Mark, we've just seen the fourth federal budget from the Albanese government and it
00:17was sort of the budget we weren't expecting to see, but...
00:20Well, normally you would say that about a budget, wouldn't you, that there are things
00:23in the budget that you don't expect to see, but this budget itself we weren't expecting
00:26to see because the government, of course, was going to go to an election without having
00:30this budget.
00:31Then there was Cyclone Alfred and of course, you know, we find this budget having been
00:36somewhat hastily prepared by the government and presumably it'll be a pretty hasty response
00:40from the opposition when they come out a couple of days hence.
00:44Absolutely.
00:45And I guess one of the other surprises we saw today was some new tax cuts.
00:48So that will be for every taxpayer, it'll be a couple of hundred dollars a year rolling
00:51out over two years.
00:52What do you make of that?
00:53Was that a bit of a surprise?
00:54I think it is a surprise.
00:56We haven't really had much in the way of discussion about that in the sort of public framing of
01:00this budget.
01:01We knew there was the $8.5 billion Medicare boost and there was going to be more money
01:04in the PBS to keep prescription medicines down, all these sorts of things, but we hadn't
01:09heard anything about income tax cuts.
01:11The government calls them modest.
01:13They are actually quite modest and it says you've got to take it sort of three increments
01:16of tax cuts together because if you don't, you're talking about some pretty insignificant
01:21amounts of money, at least as a sort of a single year benefit.
01:25I think it has been designed to wrong foot the opposition.
01:28I mean, the opposition wouldn't obviously want to be coming out with its own tax cuts,
01:32but if it tries to go further than the government, it's going to have to say where that money's
01:36coming from.
01:37Absolutely.
01:38And do you think it will, given they are modest tax cuts, do you think it will make a difference
01:41to households, particularly as we head into a federal election?
01:44Well, I think it sends a signal, right?
01:46I mean, Chalmers is trying to send a signal that the economy has turned the corner.
01:49Yes, there's all these dark clouds in the international environment, what's happening
01:54with Trump and the possibility of a trade war.
01:56You know, it's a very unpredictable world and it feels much more unstable than it has
02:00for many years.
02:02But he's also selling this message that there's something exceptional about Australia and
02:07that Australia is in a much better position.
02:10The economy's turned the corner.
02:11He talks about we're going to get to this soft landing that we have been aiming for.
02:16It's a pretty positive story.
02:17I just think there are two things about it.
02:19You know, there's the positive and the negative, the positive local story and then the negative
02:24international story.
02:25And I think whichever one of those two things resonates with voters may go a long way to
02:29deciding whether this budget is convincing or it isn't.
02:32Yeah, absolutely.
02:33And the other thing we saw in there was a very modest increase to the number of public
02:36service staffing levels.
02:39So just over 3,000 extra jobs in there.
02:42Now, this is no doubt going to be seized upon by the coalition.
02:45They've been talking about a blow to public service, whereas the Labor government says
02:49it's in the right place.
02:50Where do you think this leaves us?
02:52I mean, we're probably weeks, maybe days from a federal election being called.
02:56Well, I think the two sides, you know, really reflect the different philosophies of what
02:59government does and also the fact that there's no liberal senator in the ACT anymore, nor
03:04any real prospect of one.
03:06So you've got the coalition being pretty unrestricted in its sort of attacking of the public service.
03:11There's a bit of Trumpism in there, you know, the kind of government efficiency approach
03:15that the Dutton sort of embarked on quite quickly after Musk was appointed in the US
03:21to do the same sort of thing.
03:22And there's Labor sort of talking about services and public service jobs and so forth.
03:27So, you know, these are two different perspectives.
03:29I don't think voters really care about aggregate numbers.
03:32I do think they care about the idea of a public service that's bloated and inefficient.
03:37But I don't think we're really talking about that in any meaningful way.
03:41And what's your prediction?
03:42When do you think we're going to be heading to the polls?
03:44I think we're only days away.
03:46I think it's the weekend coming.
03:48I think...
03:49That'll be announced.
03:50Yeah, I think that a visit to the Governor-General could well happen this coming Sunday.