Young people, students and renters will be given a boost as part of the government’s $14.6bn cost-of-living package to be unveiled in Tuesday night’s budget.
Treasurer Jim Chalmers will detail additional assistance for renters on the Commonwealth Rent Assistance program, as well as increases to the base rate payments of JobSeeker, Austudy and Youth Allowance.
The budget, which will be handed down at 7.30pm, will also detail further cost-of-living policies, which Dr Chalmers will say will put direct, downward pressure on CPI.
The package includes the already announced expansion of eligibility for the single parenting payment, which will allow sole parents to retain that support until their youngest child turns 14, instead of eight.
A $1.5bn energy relief package will also be revealed.
Treasurer Jim Chalmers will detail a raise in base payments to jobseekers, students and young people on welfare payments, as well as an increase to rent assistance. Picture: NCA NewsWire/ Dylan Robinson
The budget will also provide further detail about who will benefit from up to $500 in power bill subsidies depending on where they live.
Dr Chalmers says 5.5 million households and one million businesses will benefit but has not yet provided details around who would be eligible.
The Treasurer has maintained that the cost-of-living assistance, which he says will target “the most vulnerable” as well as “middle Australia” would not add further strain to inflation.
In Labor’s second budget since taking office last May, the budget is expected to forecast a better inflation outlook for 2023-24 than Labor predicted in October.
Dr Chalmers is expected to say that is directly because of the impact of the government’s cost of living pressures.
“You’ll see tonight what we propose to do to help the most vulnerable people in our society,” Dr Chalmers said on Tuesday morning.
“We recognise that people are doing it tough, and in a budget which has still got its share of pressures, a budget which still has serious structural issues to deal with, we will do what we can to help the most vulnerable through tough times.
Dr Chalmers and Prime Minister Anthony Albanese say their budget will not add further inflationary pressure. Picture: NCA NewsWire / Martin Ollman
“Our budget is carefully designed and carefully calibrated to address cost of living pressures in our economy rather than add to them.
“We’re very conscious, obviously, of the inflation challenge in our economy, it remains the dominant concern that we have about the economy, particularly over the next little while.”
The cost-of-living package will be somewhat offset by the more than $17bn in savings found within the budget.
The budget will also forecast a “small” surplus of $4bn. If it comes to fruition, it would be the first time the budget has been in the black in 15 years.
Dr Chalmers on Tuesday morning said he was being “cautious” and not celebrating, warning of ongoing structural deficits over the near and medium terms.
The budget is expected to forecast smaller deficits than previously forecasted.
The budget is also expected to show that gross debt – approaching $1 trillion – is now expected to peak in the mid-2020s, five years earlier than the October budget forecast.