Budget 2026/27 – A Chance for a Fairer Australia

As Australia looks ahead to the federal budget on 12 May, all eyes will be on Jim Chalmers as he delivers a defining economic statement for the future of the country. This will be the government’s first budget since the 2025 federal election – and its fifth since taking office in 2022 – making it a critical moment to reset priorities and respond to the growing cost-of-living pressures facing households across the country. 

For many Australians, the reality of economic inequality is becoming harder to ignore. Rising rents, higher energy bills, and the increasing cost of essentials are placing significant strain on people already doing it tough. At the same time, community organisations are reporting growing demand for support services, often without the funding required to meet it.

Against this backdrop, there is a clear opportunity for the government to take meaningful action. A fairer budget would focus not only on immediate relief, but also on structural reforms that strengthen Australia’s social and economic foundations over the long term.

One of the most direct ways to ease financial pressure is to increase income support payments.

Current rates fall well below what is needed for a basic standard of living. Bringing these payments closer to pension levels (still only around 60% of the minimum wage) would provide essential relief and help reduce poverty.

Equally important is the sustainability of the not-for-profit community services sector itself. These organisations are on the front line, supporting individuals and families through crisis and hardship.

We need to increase overall funding and ensure all funding contracts include at least a 20% allocation for organisational overheads to ensure service providers remain viable and responsive. And with upcoming changes to the Social, Community, Home Care and Disability Services (SCHADS) award set to lift wages in the sector, we need a funding commitment from government to ensure these increases are properly supported rather than being absorbed by already-stretched providers.

Housing remains another critical pressure point.

We need greater investment in social and affordable housing, alongside stronger support for homelessness services, to address both immediate need and long-term supply challenges. At the same time, targeted reforms to tax settings — such as reducing capital gains tax discounts and limiting negative gearing to affordable housing — could help redirect investment toward more equitable outcomes.

Energy affordability is also emerging as a major concern.

Targeted energy supplements for low-income households are needed to provide relief as prices remain volatile. Such targeted relief will ensure that no one is forced to choose between heating their home and meeting other basic needs like food and medications. 

Finally, meaningful progress on inequality will require a stronger and fairer revenue base.

Measures such as increased contributions from high-wealth individuals and a proposed 25% tax on liquefied natural gas exports could generate significant public revenue. This, in turn, could fund a more robust social safety net and ensure that essential services are properly resourced. 

Taken together, these measures represent more than a policy wish list — they form a blueprint for a more inclusive and resilient Australia. By investing in people, strengthening services and reforming the tax system, this budget has the potential to not only ease current pressures but to lay the groundwork for a fairer future for all Australians.

Over to you, Mr Treasurer.