Energy bill relief will come to an end for Australian households, after the federal government made the “difficult decision” not to extend the scheme.
Labor’s energy rebate for households and small businesses were previously extended until the end of 2025.
Treasurer Jim Chalmers announced on Monday the rebate wouldn’t be prolonged into a fourth round.
“The cabinet has decided today on one difficult decision in particular … we’ve encouraged people not to see these as a permanent feature of the budget,” he told reporters in Canberra.
“They’re not the only way that we’re providing that cost-of-living relief for people who are still doing it tough.
“Now this marks a shift in the way that we are delivering cost-of-living relief.”
Dr Chalmers said more progress needed to be made on the federal budget.
“When these energy bill rebates were first put in place, we had not yet rewritten the tax cuts to make sure that everybody got one, and we hadn’t yet legislated the second and third tax cuts,” he said.
“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.”
It comes as financial markets are expecting the Reserve Bank to hike interest rates in 2026 following a spike in inflation.
The latest figures from the Australian Bureau of Statistics showed inflation jumped to 3.8 per cent in the year to October.
It is well above the central bank’s target range of two to three per cent.
Economist Chris Richardson welcomed the government’s decision as “really good news”.
“These subsidies are poor policy at the best of times, and even worse policy when Australia is still fighting the last mile of the inflation fight,” he wrote on social media platform X.
“Their removal on schedule is a good call.”
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