Political Futures: The MYEFO Factor in Preparation for the May 2026 Budget

After our two financial ministers confidently answered questions at the MYEFO Press Conference on 17 December 2025, the pressure must now be transferred to the LNP and its far-right allies to roll out better alternative policies with an appeal to voters under siege from cost-of-living increases.

Wall to wall debt prevails in most developed OECD countries from the US itself to struggling middle powers like Japan and Germany. Our approach is best practice when compared with other middle powers as the Trump administration embarks on constant variations of its opportunistic America First strategies to the cheers of military industrial complexes in the vanguard of a sinister AI rollout to prepare for more armed conflicts.

Former Greek Treasurer Yanis Varoufakis warned of troubled times ahead for middle powers in the global economy like Italy due to the mountains of accumulated debt and the stagnation of global investment flows.

Much criticized Australian budget deficits have moderated by Australia’s trading and investment ties with Asian countries. The current budget deficit is less than 1 percent of GDP. Few Australians will want a return to the austerity demanded by LNP ideologues as more troubled sagas in the global economy will emerge by the date of the next federal election and even delivery of the 2026-27 budget in May.

Labor has once again won more respect as the better financial manager of our economy by taking some daring initiatives as sections of the electorate in the regions and the outer metro suburbs drift towards the far-right of politics in financially tough times.

Our financial ministers have acted to trim the growth of the deficit level by $7.3 billion in the current fiscal year. The abandonment of electricity tariff support to households has delivered almost half of these savings. Tax reform in the 2026-27 might even save electricitytariff relief. Some curtailment of taxation concessions for negative gearing property investment would still leave a good residual surplus for more commitment to social housing. Concessions to property investors have cost the budget $39 billion in lost revenue.

The AI rollout as noted in the MYEFO document is also a good start. The Government will provide $225.2 million over four years from 2025–26, and $0.4 million per year ongoing from 2029–30, to deliver the Government’s Artificial Intelligence Plan for the Australian Public Service (APS AI Plan), which will guide the safe, responsible and coordinated adoption of Artificial Intelligence (AI) and accelerate uptake across the Australian Government. Funding includes:

$166.4 million over three years from 2025–26 for the Department of Finance and the Digital Transformation Agency to expand the GovAI platform and design, build and pilot a secure, AI assistant (GovAI Chat). Funding includes:

• $28.5 million over two years from 2025–26 for initial work and assurance, and $137.9 million over two years from 2026–27
• $28.9 million over four years from 2025–26 for the Department of Finance to establish a central AI Delivery and Enablement function to support the delivery of the APS AI Plan
• $7.7 million over four years from 2025–26 for the Digital Transformation Agency to strengthen its AI functions and establish an AI Review Committee to provide expert advice on high‑risk government AI use cases
• $22.1 million over four years from 2025–26 (and $0.4 million per year ongoing) for the Australian Public Service Commission and the Digital Transformation Agency to deliver foundational AI capability building activities and deliver a coordinated workforce planning initiative to help agencies manage AI‑driven changes in job design, skills and mobility

Yanis Veroufakis has warned humanity against allowing AI technology to be implemented at the behest of US multinational companies in government agencies, strategic planning and intel networks. The extension of the rollout to industry and private media networks would totally change the balance between labour and capital which has evolved since the 1890s.

Specific corporate providers are ready to deliver AI technology on their own terms:

• Microsoft: A significant partner, with the government conducting an initial trial of Microsoft 365 Copilot across the APS to explore the safe and responsible use of generative AI tools.
• OpenAI: Through the OpenAI for Australia initiative, the company is engaging in a sovereign AI infrastructure partnership with data centre operator NEXTDC to establish a large-scale GPU supercluster in Sydney. OpenAI is also partnering for skills training.
• NEXTDC: A core partner for building the necessary high-performance computing and data centre infrastructure to host sovereign AI capabilities for government and sensitive workloads.

The Albanese Government has a more nuanced plan for the wider introduction of AI as summarised by Google Bard:

• GovAI: This is a centrally hosted, whole-of-government service designed to uplift AI capability. It provides a secure, Australian-based infrastructure for developing customised AI solutions, access to a diverse range of AI models (including secure, onshore instances of third-party LLMs), and the development of GovAI Chat for APS staff. It is operated by the Department of Finance
• AI Delivery and Enablement (AIDE): A new multidisciplinary function within the Department of Finance, AIDE is responsible for accelerating AI adoption, overcoming common barriers, and sharing lessons across the APS.
• Chief AI Officers (CAIOs) / Accountable Officials: Under the APS AI Plan, agencies are establishing Chief AI Officer roles and designating AI Accountable Officials who are responsible for their agency’s implementation and compliance with the responsible AI policy.
• AI Safety Institute (AISI): A new entity proposed to strengthen testing, evaluation, and oversight of advanced AI systems, coordinate with specialist regulators (like the Office of the Australian Information Commissioner), and coordinate major incident responses.
• National Artificial Intelligence Centre (NAIC): Coordinated by the CSIRO, the NAIC supports Australian industry and researchers, helping local businesses, particularly SMEs, adopt AI technologies.

As our military spending climbs above 2 percent of GDP or $60 billion each year, this vast segment of government spending cannot be left to military chiefs and intel networks without stronger public scrutiny. The Albanese Government has already responded to this accountability challenge by strengthening the scrutiny of military spending (Defence Media 1 December 2025).

The LNP’s concerns about the timid growth in responsible federal public sector spending beyond 27 percent of GDPshould be dismissed as ideological rhetoric:

Government spending in Australia was last recorded at 26.5 percent of GDP in 2024.Government Spending to GDP in Australia averaged 24.50 percent of GDP from 1971 until 2024, reaching an all-time high of 31.40 percent of GDP in 2021 and a record low of 18.30 percent of GDP in 1971. 

Australia’s Federal Public Sector Spending

MYEFO 2025 is a thoroughly professional document which makes provision for a rollout of government commitments to AI against corporate intrigues. National sovereignty must be protected by a more united front between Labor and the progressive sections of the senate crossbench as achieved with the passage of the environmental reform laws. The challenge of progressive tax reform invites similar action in the lead up to the May 2026 budget.

Principles sacred to all progressive political players should not be abandoned. Vested interests can be challenged through strength in numbers with an added investigative voice from the few progressive media networks available outside the underfunded Australian public broadcasting networks (Image: Australian Government):

Public Broadcasting Allocations

Denis Bright (pictured) is a financial member of the Media Entertainment and Arts Alliance (MEAA). Denis is committed to consensus-building on the critical issues raised in each article. Your comments on this and related articles can be recorded on theaimn.net site.

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