Labor sets up energy bill relief in March budget for May election

The moves follow a flurry of Labor measures since the start of the year including an $8.5 billion boost to bulk-billing through Medicare, the funding of 50 urgent care clinics to ease pressure on hospitals, more than $7 billion for public schools and decisions to fund major roads.

Dutton has cited the spending as a reason for voters to throw Labor out of office, saying the Coalition would cut government waste and improve the budget bottom line.

Cyclone Alfred bearing down on Queensland and northern NSW has forced a shift in focus in federal politics in recent days, Albanese has restated the plan to issue the federal budget on March 25, saying on Thursday morning: “We have a budget that we’re prepared for”.

Albanese has until the close of business on Monday to call an election for April 12 and ensure a campaign of at least 33 days, as required under the Constitution, but that is now off the table. The prime minister will call the election for May 3, 10 or 17. Other dates have been ruled out because April 19 is on the Easter weekend and April 26 is the day after Anzac Day.

An election in May could be costly for Labor as television and radio advertising has been booked and some staff have paid for four weeks of accommodation around the Sydney office where the party’s election headquarters are based.

Media advertising buyers who book slots for Labor are actively talking about changing the dates of Labor’s advertising bookings as a contingency if the election is in May rather than April, according to advertising industry and political sources.

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Senior figures believe the government’s position is improving because Albanese and Chalmers can point to good news on four economic factors: the recent cut to official interest rates; lower inflation; good unemployment results; and the economic growth revealed on Wednesday.

A YouGov poll published on Friday showed Labor was in front of the Coalition, mirroring Labor research which showed the party gaining ground following a rate cut and an $8.5 billion Medicare announcement. Coalition sources disputed any significant rise for Labor in recent weeks, while the Resolve Political Monitor in this masthead showed last month that the Coalition was up 52 to 48 per cent in two-party terms.

Dutton has argued the government should stick to its stated plan for a budget on March 25 because a race to an earlier election would be proof that Labor wants to hide the “true, dire picture” of the nation’s finances.

Richardson, a longstanding budget observer, estimated a combination of a strong jobs market, higher prices for key commodities and ongoing inflation have ensured a revenue windfall when the federal finances are revealed.

In the budget update last December, Chalmers forecast a deficit of $26.9 billion for this financial year, widening to a $46.9 billion shortfall in 2025-26.

Monthly budget data suggests more revenue is hitting government coffers. To the end of January, the budget was $3.6 billion better than forecast on a pro rata basis.

But Richardson said given the state of the economy, this year’s deficit was now on track to edge down to $16.1 billion thanks in part to a $12.7 billion jump in revenue. The deficit for 2025-26 is on track to be around $41.2 billion with total revenue $11.6 billion ahead of expectations.

The additional revenue over this year and next adds up to $24.3 billion in his forecast.

Describing it as a lottery win, Richardson said the budget was being boosted by tax growth that would ultimately come to a halt.

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“Many migrants meant more people to tax. Wars pushed up the price of what Australia sells to the world and we got tax windfalls from that,” he said.

“And inflation took money from families and handed it to the taxman.”

Income tax on individuals is forecast by Richardson to be $5.9 billion better than expected this year and $8.2 billion stronger in 2025-26. Company tax collections are likely to be $12.2 billion better than forecast over the two years.

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