Prime Minister Anthony Albanese has declined to guarantee that vital energy bill rebates will continue into the new year, creating significant uncertainty for millions of households across the country as electricity costs continue to climb.
Rebate Scheme Faces Uncertain Future
The energy relief measure, first introduced in the 2024 federal budget, initially provided every household with a $300 reduction on their annual power bills. This initial phase came at a total cost of approximately $3.5 billion to the taxpayer.
In a subsequent move, this year's budget allocated an extra $1.8 billion to extend the support for a further two quarters. This extension, set at a rate of $150 per household, is scheduled to expire on December 31, 2024. The total government spend on the rebate programme now exceeds $5 billion.
When pressed on the ABC's Insiders programme by host David Speers about whether the assistance would be renewed for 2025, Mr Albanese offered no assurances. 'What we've said is this wouldn't be in place forever,' the Prime Minister stated. 'This was an interim measure.'
Government to Review Relief Ahead of MYEFO
Mr Albanese hinted that the cabinet would reconsider the issue in the lead-up to the Mid-Year Economic and Fiscal Outlook (MYEFO), which is due for release before the end of January. 'We'll give consideration to that in the lead-up to MYEFO, and make an announcement before the end of the year,' he told the programme.
The continuing ambiguity arrives as the Labor government faces mounting political pressure to address the persistent cost of living crisis, with energy costs a central concern. The Albanese cabinet is expected to meet to discuss a potential national gas reservation policy, aimed at boosting domestic supply and reducing wholesale prices.
'The objective is cheaper gas,' Mr Albanese said, while tempering expectations of an immediate solution. 'We're examining that. We won't be making a decision tomorrow, contrary to what has been reported.'
Rebates Mask Underlying Inflation Pressure
The energy rebates have had a pronounced effect on official inflation figures. Treasury analysis indicates the payments reduced the Consumer Price Index (CPI) by up to 0.75 per cent in the 2023–24 financial year, a statistic the government has used to promote its cost-of-living relief efforts.
However, the temporary nature of the support has led to volatility. When a previous round of federal rebates expired in mid-2025, inflation spiked sharply. Data from the Australian Bureau of Statistics showed the CPI jumped 1.3 per cent in the September quarter alone, pushing the annual rate to 3.2 per cent from 2.1 per cent in June.
Electricity prices were the primary driver, soaring 9 per cent in the quarter and 13.1 per cent over the year once the rebates were withdrawn. Economists warn that the subsidies have merely disguised underlying price pressures, creating a 'cliff-edge' effect for the inflation data.
The opposition has been highly critical of the scheme. Opposition Leader Sussan Ley has previously dismissed it as a 'political sugar hit', accusing Labor of using taxpayer funds to paper over the cracks of a deeper energy policy failure.
Opposition frontbencher Alex Hawke echoed this sentiment, telling Sky News the government was failing to tackle root causes. 'The number one reason the Labor government is bailing out so many heavy industry businesses is because their power costs are doubling or tripling,' he argued.
Mr Hawke questioned the long-term sustainability of the approach, stating, 'So the question we have to ask is, how long can the taxpayer pay for electricity bills when the government pressure is increasing the price? It's unsustainable.' He concluded that further rebates would not solve the fundamental crisis of soaring power prices.
