Australia's government has axed billions of dollars in energy bill rebates for families and small businesses, sparking relief among economists but criticism from politicians.
The decision not to extend the power bill subsidies into the new year is a significant blow to the most vulnerable households that relied on the scheme to shield them from soaring global energy costs. Over the 18 months, the government spent nearly $7 billion on the three rounds of subsidies.
"This was pure political pork," said Chris Richardson, an economic commentator. "It's remarkably little to recommend as a policy."
The move comes as the Reserve Bank's monetary policy board weighs a recent rebound in inflation that could force the central bank to hike interest rates next year. Pointing to "intensifying" pressures on the nation's finances, Treasurer Jim Chalmers said there would be savings and difficult decisions but no major new policy announcements.
"We're not doing a mini-budget here. We're going to make room for our priorities," he said. Blow-outs in programs such as veteran affairs are weighing on the budget bottom line, along with higher-than-anticipated spending due to natural disasters.
Cost-of-living pressures remain the top issue confronting voters, and the decision has been welcomed by some but criticized by others. "What you've got to do is get down energy prices so that there's no need for this," said Liberal senator Anne Ruston, laying blame at the feet of the Albanese government.
The end of the rebates marks a significant shift in policy as economists say it was always an unsustainable solution. Economists have praised the decision but also warned about potentially higher mortgage costs next year.
As inflation rates continue to fall and economic growth slows down, Treasurer Chalmers has set the scene for a fiscal update that will contain no major new policy announcements.
The decision not to extend the power bill subsidies into the new year is a significant blow to the most vulnerable households that relied on the scheme to shield them from soaring global energy costs. Over the 18 months, the government spent nearly $7 billion on the three rounds of subsidies.
"This was pure political pork," said Chris Richardson, an economic commentator. "It's remarkably little to recommend as a policy."
The move comes as the Reserve Bank's monetary policy board weighs a recent rebound in inflation that could force the central bank to hike interest rates next year. Pointing to "intensifying" pressures on the nation's finances, Treasurer Jim Chalmers said there would be savings and difficult decisions but no major new policy announcements.
"We're not doing a mini-budget here. We're going to make room for our priorities," he said. Blow-outs in programs such as veteran affairs are weighing on the budget bottom line, along with higher-than-anticipated spending due to natural disasters.
Cost-of-living pressures remain the top issue confronting voters, and the decision has been welcomed by some but criticized by others. "What you've got to do is get down energy prices so that there's no need for this," said Liberal senator Anne Ruston, laying blame at the feet of the Albanese government.
The end of the rebates marks a significant shift in policy as economists say it was always an unsustainable solution. Economists have praised the decision but also warned about potentially higher mortgage costs next year.
As inflation rates continue to fall and economic growth slows down, Treasurer Chalmers has set the scene for a fiscal update that will contain no major new policy announcements.
The government's decision on those energy bill rebates is kinda weird. On one hand, it's good that they're not just handing out free money, but on the other hand, I feel bad for all the families and small businesses that were relying on that to get by. They must be worried about how they're gonna pay their bills now. 
It seems like they're trying to save a bit of cash, but I wonder if it's really worth it in the long run?
. It's not like they're gonna magically lower energy prices or something 
. As Chris Richardson said, it was just "pure political pork" 
. The economists are saying it was always an unsustainable solution, but still... poor timing for those families who need a break 
. Maybe they should've done it before the inflation rates started to drop again 
without really thinking about the people who actually rely on that program 
they should be helping ppl out not making life more costly 
i mean im all for fiscal responsibility but this feels like a huge cop out 
maybe the gov shouldve set up a transition plan instead of just saying oh its too expensive 
they need help payin bills, not be expected to find ways 2 cut costs or risk losin their homes. this decision is straight outta a privileged persons playbook 
I'm literally livid about this 
! Who do they think they are, just pulling the plug on billions of dollars in subsidies like it's nothing? 
.
. I mean, come on, if you're gonna cut subsidies, make sure those in need aren't left high and dry 
. Ugh, this is just another example of how broken our system is 
yesterday and I saw this huge flock of seagulls attacking people's picnics 
it was hilarious! anyway, I started thinking about how our society is like those seagulls - always looking for an easy meal 
and the government is just trying to balance out the books. speaking of which, have you tried that new vegan cafe downtown? I heard their avocado toast is 
They were basically throwing money out the window to prop up energy prices 
And now we're gonna see some tough decisions down the line 
small businesses too will be affected 
It's not exactly a recipe for economic stability, you feel?