The Government has announced several measures designed to deliver cost-of-living relief to individuals.

• From 2026-27, the tax rate for the $18,201-$45,000 income threshold will be reduced from 16% to 15% and in 2027-28 to 14%.
• The Medicare low-income thresholds for singles, families, seniors and pensioners will increase from 1 July 2024 to provide cost-of-living relief.
• Outstanding Higher Education Loan Program (HELP) and other student debts will be reduced by 20% on 1 June 2025 and will move to a marginal repayment system with a previously announced increase to the minimum income threshold to $67,000 from 1 July 2025, up from $54,435 in 2024-25.
• A $1.8bn extension to the Energy Bill Relief Fund to the end of the 2025 calendar year. Over 10 million household will receive a $150 energy rebate off their electricity bill in two quarterly payments of $75 each.
   

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The Government has legislated the removal of the Activity Test which will come into effect in January 2026. This means that parents will qualify for three days subsidised care, irrespective of their activity in the workplace, efforts to educate themselves or find work.

Previously parents needed to show evidence that they were working, studying or looking for work for at least 16 hours each fortnight to access subsidised child care.

Parental contribution to child care fees remain unchanged; where households with incomes of $83,280 or less have 90% of the costs subsidised by the Government, which slowly reduces by 1% for every $5,000 of income your family earns. Effectively the subsidy is removed on household incomes over $533,280.

This change increases the accessibility to Early Childhood Education and Care for many Australians. A benefit is that this may alleviate some of the time vulnerable children spend with their parents, and provide an opportunity for setting them up for school life. However, opening the childcare systems to be accessible by those who choose not to engage in the workforce does come at the expense of taxpayers. 

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