Cost of Living Takes the Prize While the Environment Waits at the Sidelines
The 2025–26 Federal Budget has made its priorities clear: easing the pressure of household bills takes precedence, while meaningful environmental investment remains a distant concern. From tax cuts to energy rebates, the budget is designed for political immediacy. But in doing so, it misses a long-term opportunity—and sends a troubling signal about how we value Australia’s natural environment.
A Budget Built for Hip Pockets
Treasurer Jim Chalmers handed down a budget that responds to the cost-of-living crunch with everything short of cash in envelopes. Among the headline items:
Tax relief for middle-income earners
A fourth round of energy bill rebates
Boosted rent assistance
Expanded bulk billing incentives
More spending on social security and aged care
In total, billions have been allocated to address short-term household pain. That’s not to say these measures aren’t warranted—many Australians are doing it tough. But the budget narrative is dominated by immediate relief, with barely a whisper about long-term environmental resilience.
What Did the Environment Get?
Here’s what the environment was allocated in 2025–26:
$2 billion to expand the Clean Energy Finance Corporation (intended to unlock $8 billion in private investment)
$2 billion for a Green Aluminium Production Credit
$1 billion for a Green Iron Investment Fund to build new low-emissions facilities
$262 million to help conserve 30% of Australia’s land and marine areas by 2030
$12 million over four years for better ocean protection
$11 million for managing feral animals, pests, and weeds
$3 million to conserve the critically endangered Maugean skate
$7.6 million for panda care at Adelaide Zoo
It’s not nothing—but it’s far from a serious response to the scale of Australia’s environmental crisis. If this is the best we can do in the hottest year on record, it begs the question: what will it take for nature to get a budget headline?
The Public Mood: Environment Falls Down the List
If the government seems politically cautious on environmental spending, it’s because they’re reading the room.
According to SEC Newgate Australia’s February 2025 survey, a whopping 81% of Australians named cost of living as their number one concern going into the next election. Climate change and environmental protection at 29% barely registered by comparison. 2
This marks a shift from the post-Black Summer years when the environment surged in public consciousness. Now, with inflation biting and rents rising, voters want immediate action on bills, not biodiversity.
It’s an understandable reaction—but also a dangerous one. Climate change and environmental collapse don’t wait patiently for inflation to normalise. Every year of underinvestment compounds the risks and the costs.
An Opportunity Missed
This was a chance to do both: address short-term economic pain and lay the groundwork for long-term sustainability.
Australia has the momentum. Renewable energy investment is booming. The business case for decarbonisation is clear. And public concern about climate risk hasn't vanished—it’s just been buried under more immediate pressures.
The government could have leaned into this moment with bold investment in nature repair, ecosystem resilience, and emissions reduction. Instead, it offered modest conservation dollars and called it a climate budget.
Even the headline items—like the green metals initiatives—are framed more around industrial competitiveness than environmental integrity. There’s little in the way of new investment in biodiversity, reforestation, or habitat restoration. For example, there’s no meaningful plan to reverse the 58% decline in threatened species abundance since 2000, as reported by ANU’s Australia’s Environment Report 3.
The Bottom Line
The 2025–26 Budget reflects the political and economic moment: voters want relief, and the government delivered it. But the environment once again comes off second-best—acknowledged with polite footnotes, not structural ambition.
This is a missed opportunity, and one the private sector will have to keep filling. Fortunately, momentum is building in sustainable finance, regenerative agriculture, and green infrastructure. If the federal budget won’t lead, markets may yet follow their own conscience.
But this doesn’t let government off the hook. Environmental resilience isn’t a luxury we can budget for “when things settle down.” It’s a national asset. And if we ignore it now, we’ll be paying for it later—no rebate included.
References
2025-26 Portfolio Budget Statements. March 25 2025 Department of Climate Change, Energy, the Environment and Water https://www.dcceew.gov.au/about/reporting/budget
SEC Newgate. “Mood of the nation February 2025” 13 February 2025 https://www.secnewgate.com.au/mood-of-the-nation-february-2025-summary/
Australian National University. “Australia’s Environment 2024 Report”, 20 March 2025 https://ausenv.tern.org.au/aer.html
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