How the budget is actually going to help the cost of living.

Cost of living. It's all we seem to be talking about lately. I mean, even a quick dash to Woolies for "a few things" somehow leaves you $60 poorer these days.

We're all feeling the squeeze. Women have been telling Mamamia what they're actually going without during this cost of living crisis, from medications to basic necessities. And thankfully, the government seems to have noticed.

Treasurer Jim Chalmers handed down the Federal Budget today, promising "meaningful" but responsible relief. But here's what we're all wondering — will it actually make a difference to our everyday lives?

When politicians start talking about 'fiscal responsibility' and 'economic frameworks', it's tempting to zone out. But stay with me, because buried in the budget jargon are actual dollars that could find their way into your bank account.

So let's cut through the political waffle and break down exactly where you might see some relief from this year's budget.

Listen to The Quicky discuss the government's budget proposal. Post continues below.

Here's your TL;DR.

The key measures you'll likely care about:

• Childcare: A guaranteed eligibility for at least three days a week of subsidised childcare.

• Medicare boost: $7.9 billion has been committed to making nine out of 10 GP visits bulk billed by 2030.

• Energy relief: $150 will be wiped from your energy bill through to December.

• Tax cuts: A "modest" tax cut for all taxpayers in 2026-27 and 2027-28, with a worker earning an average of $79,000 a year to pocket $5.15 extra a week – and $10.30 in 2027-2028.

What the federal budget actually means for you.

The bottom line.

After delivering back-to-back surpluses, the government has been preparing us for things to swing the other way.

When we say this year's budget is "in the red," it's just like when your bank account is overdrawn before payday. The government is spending more than it's collecting in taxes, creating what economists call a "deficit." Think of it as Australia using a national credit card to cover the gap between income and expenses.

Just like last year, the government needed to balance spending plans with the need to keep inflation under control. This year, the government is forecasting a deficit of $42.1 billion.

A deficit isn't necessarily a bad thing. Sometimes going into the red makes sense — like when you invest in a house renovation knowing it will add value later.

The treasurer was under pressure to avoid spending too much, while also delivering some election sweeteners in the budget. With the budget forming part of the government's pre-election pitch, many of the announcements will only be delivered if Labor is re-elected.

Chalmers said there are five top priorities this year: cost of living relief, strengthening Medicare, building more homes, investing in education and making our economy "stronger, more productive and more resilient". 

Let's deep dive into the big hitters, shall we?

Cost-of-living.

We knew most of the major cost-of-living announcements heading into budget day. But the government has also announced new tax cuts to all taxpayers in 2026 and 2027. Treasurer Jim Chalmers said it was "modest" tax cut but when made a difference when combined with the government's first round of tax cuts.

From July 1, 2026, the 16 per cent tax rate, which applies to taxable income between $18,201 and $45,000, will be reduced to 15 per cent. From July 1, 2027, this will be reduced again to 14 per cent. It means more money in your pocket — $5.15 a more a week in 2026-27 for a worker earning $79,000 and $10.30 a week in 2027-28.

Australian Treasurer Jim Chalmers during a press conference inside the 2025 Budget lockup at Parliament House. Image: AAP.

The new cuts hinge on the Labor government being re-elected.

An interesting element of the budget is a move to ban most non-compete clauses for low- and middle-income workers. The government said one in five workers are subject to these clauses that restrict their ability to move to a new job and are significantly suppressing wages.

This tends to affect casual workers and roles such as yoga instructors, where you might not be allowed to work at a "competing" studio. 

Finance Minister and Minister for Women Katy Gallagher said she believes it will help women earn more as they can move around to higher-paying roles. 

Energy bill relief.

From July 1, you'll have $150 wiped from your power bills through to the end of the calendar year. 

The government's $300 energy rebate was set to end on April 1, but the government announced a $1.8 billion extension for the rest of the year. This will come in the form of two $75 rebates applied directly to their bills. 

The opposition has promised to support the move, meaning it will be implemented regardless of the election result.

Childcare.

Families with young children will benefit from receiving three days a week of subsidised childcare from January next year. The government has committed to ditching the childcare subsidy activity test with a new three-day guarantee. 

It's also committed to creating a $1 billion fund to help build more than 160 childcare centres "where they are needed the most". We already knew this though.

Healthcare.

There's lots to talk about in healthcare. It's mainly things we already knew, but worth unpacking.

The government has promised to cap the cost of PBS-listed medicines at $25 per script down from $31.60 from January 1, 2026, if re-elected. It estimates this will save people up to $235 a year. 

It's also committed $7.9 billion to make nine out of 10 GP visits bulk billed by 2030.

"More bulk billing will mean less pressure on families," Chalmers said.

Then there's the almost $800 million women's health package. This includes new oral contraceptives (Yaz, Yasmin and Slinda) listed on the PBS for the first time in more than 30 years and Medicare rebates being boosted for women using long-term contraceptives, such as IUDs and birth control implants. 

There's also improved access to menopause support, with the first new menopause treatments on the PBS in 20 years (Estrogel, Estrogel Pro and Prometrium), a new Medicare rebate for menopause health assessments, funding to train health professionals and the first ever clinical guidelines.

It also includes funding for 11 new clinics dedicated to endometriosis and pelvic pain, bringing the national total to 26. These clinics will offer specialised care and support for women suffering from these conditions.

Education and training.

Got student debt? The government is reducing all outstanding Higher Education Loan Program and other student debt payments by 20 per cent from June 1, subject to legislation passing. 

The student loan repayment system will be reformed from July 1, with the government set to increase the amount that people earn before they have to start paying back their loans from $54,435 in 2024-25 to $67,000 in 2025-26.

The government is investing in extending its free TAFE program, which offers 100,000 free placements a year. If passed, the extension will take effect from January 1, 2027

Housing.

An extra $850 million has been committed over four years into housing. The majority of this will be used to expand the government's help-to-buy program, which allows participants to buy a property with a deposit as low as 2 per cent.

It's committing $800 million to increase income caps from $90,000 to $100,000 for individuals and from $120,000 to $160,000 for joint applicants and single parents. Property price caps will also be increased and linked with the average house price in each state and territory, not dwelling price to make the scheme more accessible. 

It estimates about 40,000 Australian households locked out of the market will be helped into home ownership.

Another $54 million has been allocated to accelerate the uptake of modern methods of housing construction, which the treasurer says is about building more homes, more quickly.

Foreign buyers will also be banned from purchasing existing homes for two years from April 1 and the government will provide the ATO $5.7 million to enforce the ban. 

It also plans to provide $8.9 million to the ATO and treasury to target land banking by foreign buyers and ensure vacant land in Australia is put to productive use within reasonable timeframes. 

As for renters, the government is implementing "A Better Deal for Renters". Basically, it's the federal government asking state and territory governments to change their laws to create consistent renters rights across the country.

The government says this will be a framework on "genuine reasonable grounds for eviction and moving towards limiting rental increases to once a year". It's something that's already underway, but the extent and pace of implementation varies between states and territories.

But first, listen to Prime Minister Anthony Albanese on Mamamia's No Filter podcast. Article continues after audio.

What about the Coalition?

So far, they've promised to match some of the government's priorities dollar-for-dollar, including the $8.5 billion for Medicare and the extension of the government's energy bill relief.

The Coalition has also shared some of its own policies in its pre-election pitch, including plans to cut 36,000 public service jobs, a crackdown on working from home, a return to tax-free corporate lunches and a $5 billion housing infrastructure fund.

We can expect to hear more when Dutton gives his budget reply speech. 

Now that's out of the way, all eyes are on Albanese to call the election.

Feature image: AAP.