Australian Political Futures: Post-Budget Initiatives

As military conflicts and fuel supply problems affect Australian and global markets, the Albanese Government offered a cautious response in its 2026-27 Budget. As a Middle Power, Australia operates largely in the shadows of decisions being made by the Trump administration. Australians are kept in the dark about the full details of our military commitments as military spending increases to beyond $60 billion in forward estimates with regular Australian manoeuvres from bases between the Middle East and Micronesia as covered in my most recent article for The AIMN.

As Chair of the RBA (14 March 2026), Michelle Bullock has urged caution in our non-military budgetary processes. There has even been a slight improved in both fuel supplies and overall inflation rates in the March Quarter.

The Budget Papers followed this advice by commitment to budget savings for 2026-27 compatible with commitments to improved productivity that make environmental approvals easier to process and election commitments to improved social housing (Paper 1:108):

With the Australian public sector tipping creeping up slightly towards 27 percent of GDP in Chart 3.5 with a modest deficit of $31.5 billion, there is nothing very radical about current budget parameters. Treasurer Jim Chalmers has trimmed the growth of budget spending as shown in Box 3.2:

Despite the tirade of abuse from much of mainstream commercial media, the Capital Tax (CGT) changes are contributing to budget restraint. Reforming negative gearing on rental properties from 1 July 2027 will net $3.6 billion in budgetary savings over five years with additional receipts from the 30 per cent tax on discretionary trusts bringing in an additional $4.5 billion. The Economics Committee will look at the details of the capital gains tax schedules on start-up technological initiatives and other small business initiatives. These a very fair outcome.

Not all business ventures are worthy of reduced capital gains schedules. I noticed a bicycle rental and repair workshop in the Ryan electorate has invested in an adjacent lolly shop which might become a prime site for redevelopment in the future. I cannot see how this investment adds anything to the local economy which needs a mini-supermarket and loop buses to minimise traffic flows to the Indooroopilly Plaza and to serve Indooroopilly Station so that cars can be left at home.

In their ideological campaign against government spending and financial support to the states and territories, the LNP should be upfront about which priority areas are going to be cut by any incoming Angus Taylor Government with support from One Nation. Horror budgets every few years from 1953 were hallmarks of the LNP’s reliance on monetary policy and Cold War scare campaigns for most of the past seventy years.

Treasurer Jim Chalmer’s fiscal policies have kept economic growth positive while maintaining fuel supplies through negotiations with Asian suppliers. Voters are entitled to know which portfolios are going to be slashed to increase defence spending to the 3.5-5 per cent range recommended by the Trump administration.

All this is being achieved with a national public sector of just 27 per cent of GDP including revenue sharing with the states and territories from National Partnerships ($$20.2 billion for 2026-27), specific purpose grants ($97.5 billion) and GST revenue sharing.

Economic projections are in accordance with advice from the RBA Board:

Compared with other developed OECD countries, the Australian economy is doing quite well and overall performance is stimulated by ties with nearby ASEAN trading partners and China (Budget Paper 1: 54):

The fiscal and budgetary reform agendas of the Albanese Government are consistent with advice from the RBA Board. The government has shown added flexibility on the specifics of its capital tax reform agendas by referring Treasury Laws Amendment (Tax Reform No. 1) Bill 2026 and Income Tax Rates Amendment (Tax Reform No. 1) Bill 2026. These measures are to be reviewed by the Standing Committee on Economics for consideration and an advisory report by 31 July 2026.

Both the LNP and key independents opposed this decision and prefer a rhetorical extra-parliamentary campaign against the tax reform proposals even through they are presented in the Economics Committee with the following response from Dan Tehan as Manager of Opposition Business in the House of Representative on 28 May 2026:

“Mr TEHAN (Wannon – Manager of Opposition Business) (11:30):  We’ve said we will work with all members of this House to have these toxic taxes fully examined and to absolutely ensure that we’re doing everything we can to make sure that the Australian people know what the broken promises will mean for them, and the best way in which we can do that, and the first step in doing that, is to make sure that they’re fully examined. I would say to the government: What have you got to hide? Why don’t you want these toxic taxes fully examined? Why don’t you want the entrails sorted through so that we know and understand who you’re hitting? Not only do we need to know all the detail; we need to make sure the government understands the detail, because, as we’ve seen in question time, the Prime Minister doesn’t have a clue about his own budget.”

The Albanese Government has made some unsustainable austerity measures such as the cutbacks on private health insurance subsidies for seniors which increase the financial burden on public health facilities.

The Economics Committee can rationalise the capital gains initiatives to overcome this specific injustice and to wider opportunities for social housing in metro areas and regional cities like the Gold Coast where housing costs and rentals have become unaffordable.

Our political and administrative elites must surely be aware of the scars of homelessness which are on display from the bay windows of Police HQ in Roma Street Brisbane on the southside river precincts. Winers and diners at Brisbane leading restaurants should feel embarrassed by the flickering lights of test cities closer to the Brisbane Botanic Gardens.

Down by the River in Brisbane

The Parliamentary Economics Committee is a forum where our elected representatives can fine tune the optimum capital gains structures while ditching the post-1999 negative gearing rental housing investment lurks.

Urgent capital gains reform is justified by appalling data from ACOSS and the UNSW Business School

According to the latest consolidated data from the ACOSS/UNSW Inequality Partnership and the ABS, Australia’s total household wealth is highly skewed:

• The Top 10%: Owns almost half (Approx. 44%) of all household wealth.

• The Highest 1%: Alone commands over 11% of the nation’s total wealth.

• The Bottom 60%: Combined, the lower three-fifths of the population own just 17% of the national wealth pie.

• The Bottom 20%: Holds less than 1% of total wealth (averaging just a few thousand dollars in net assets per household, often offset by consumer debt).

• The average wealth of a household in the top 10% sits at over $6.1 million, whereas a household in the bottom 20% averages $12,000.

Down by the River in Winter Grey: Contemporary Reply to the Moreton Bay Lament?

From Milky Chance:

The Convict’s Lament:

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.