2025-26 ACT Budget
Introduction
Mr Speaker, I acknowledge the Ngunnawal people, the traditional custodians of the ACT, and recognise other First Nations people and families who have connections to the lands of the ACT and to our region.
The 2025-26 Budget invests in our growing city and delivers on our commitments to Canberrans.
I’d like to thank all my colleagues, especially the Chief Minister, Andrew Barr, the Deputy Chief Minister, Yvette Berry and the Finance Minister, Rachel Stephen-Smith, for their support in delivering this budget and our plans for Canberra.
This is a budget for all Canberrans. As Treasurer, it is my first budget, and it is a Labor budget.
That means it reflects our values and delivers on our progressive and practical plans for Canberra.
It’s a Budget for better healthcare, more housing, new infrastructure, better jobs, growing wages and support for the vulnerable Canberrans in our community.
And it’s a Budget that delivers better services, not deep cuts.
Health
Mr Speaker, Budgets are about choices.
The decisions a government makes in the Budget reflect its priorities.
For our Labor team that choice is clear.
We will always invest in a strong public health system.
We are working every day to make sure that Canberrans have access to the healthcare they need, when they need it.
It’s why in this Budget we are delivering the biggest investment in the public health system in our city’s history.
We will invest an additional $1.196 billion to support the health of Canberrans - responding to growing demand and increased costs and expanding health services closer to home.
This builds on our track record of strong investments in public health care and hospital infrastructure, including hiring more nurses, doctors and allied health professionals, and sets up our health system for the future.
We are delivering on our commitment to 70,000 elective surgeries over four years.
And making investments to support targeted interventions that support efficient delivery of care and ensure better patient experience.
We will also look after and care for Canberrans suffering from chronic diseases which has grown to 18,500 more outpatient appointments.
Mr Speaker, like all jurisdictions, our public hospital system is facing extraordinary pressure. With higher demand and growing costs, our public hospitals are seeing more patients, with more complex health needs.
Canberrans rightly have the expectation that when they present to our emergency department, they will receive quality public health care at their time of need.
To address the pressures our health system faces, we’ll invest beyond just our public hospitals and provide more support for primary care, our health workforce and mental health services.
We’ll invest $7.3 million to support general practice with bulk-billing incentives, wellbeing and professional development support for GPs, and more junior doctor placements.
We’ll grow the Aboriginal and Torres Strait Islander workforce and address systemic barriers to participation with a $2.4 million investment.
We’ll build on our investments for mental health services by committing $9.5 million to strengthen community-based mental health programs.
Mr Speaker, our investment in health through this Budget is about recognising the ongoing impact of the increased demand and cost of delivering a high-quality public health system, while making new and sustainable investments in our health workforce and local infrastructure to deliver the health system Canberrans expect.
Housing
Mr Speaker, a key priority for our government is housing.
A home provides the foundation for so many aspects of a person’s life - for health, education, work, family and so much in between.
We believe there is a moral and economic imperative to supply more homes and ensure that all Canberrans can afford housing in our city - to buy or rent.
And it’s why we’re investing more than $145 million in housing to support 30,000 homes by 2030.
We will focus on affordability, supply, sustainability and smart planning, ensuring we use every lever at our disposal to tackle housing supply.
This Budget brings together land release, planning reform, housing delivery and tax reform to meet the needs of a growing city.
It includes direct investment in new social and affordable homes, with more public housing built in partnership with the Australian Government through the Housing Australia Future Fund and the Social Housing Accelerator, $20 million for the Affordable Housing Project Fund and 300 more Build-to-Rent homes.
Proposed missing middle housing reforms will provide choice of homes where people want to live.
Budget investment in further planning reforms will provide opportunities for new housing and community facilities in well-located areas, particularly around town centres, local shops and public transport corridors.
The Government is also investing in our Productivity Agenda - working with the construction sector to streamline planning and building processes and reduce or remove regulatory barriers to ensure that new homes can be built sooner.
And we’ll invest in the people needed to build new homes, through a further investment in skills in the Budget -
Doubling the Try-a-Trade program in schools to support more young women to enter the construction industry.
And supporting every person that wants to take up an apprenticeship with a host employer - by increasing training subsidies to 90 per cent for carpentry, plumbing, tiling, bricklaying and other critical construction occupations.
These initiatives will enable the construction of tens of thousands of new homes for Canberrans over the next five years.
Economy
Mr Speaker, the ACT economy is strong.
The Government forecasts that Gross State Product will be three and a quarter per cent and rise over the forward estimates, compared to two and a quarter per cent nationally. Employment and population will grow by one and three quarter per cent with wages growing faster than inflation, with CPI expected to be two and three quarter per cent. For this Government, a further key economic metric is shown in Canberra having the highest quality of life in the world
We have the lowest unemployment rate in the country. And jobs will grow faster than the population.
Real wages are growing, and inflation is easing. Interest rates are coming down, which is welcome news for household budgets and business investment.
We have the highest median income of any state or territory and a growing population.
And Canberra has a growing and diverse private sector with the fastest rate of business growth in the nation.
The economic indicators I am presenting today would have been very different if Labor had not won the Federal election this year.
The Liberal’s plan to cut 15% of jobs in Canberra would have sent a wrecking ball through our economy and our budget.
Last month, Canberrans, and Australians, comprehensively repudiated the Liberal’s plan to make deep cuts to the Public Service.
I am pleased to say that with the election of Federal Labor we now have economic stability, with a Federal Government that backs the public service and continues to invest in the National Capital.
And we have an ACT Labor Government that is collaborating with them to confront the challenges we face and work on shared priorities.
Tough decisions
Mr Speaker, our strong economy provides the sound foundation we need to get the Budget on a more sustainable footing.
In recent years, facing extraordinary challenges from the pandemic to natural disasters and higher inflation, the Government stepped in to support the community, business and the economy.
We used the Budget to provide important emergency relief during the pandemic and in the inflationary period that followed, to support cost-of-living.
This put pressure on our fiscal position, as costs for Government also increased but fees and charges were not increased to meet these costs, and in many cases, they were paused, waived or deferred.
Coming out of the pandemic, the cost of delivering public health and hospital services has also been rising faster than anyone has predicted. Every jurisdiction in Australia is experiencing this trend.
Commonwealth funding for our public hospitals has also been declining with the ACT’s Commonwealth Contribution Rate set to be the lowest in the country, without action under a new five-year National Health Reform Agreement.
With the high inflationary period ending and interest rates beginning to fall, the time is right to adjust our fiscal strategy.
It’s why, as we make a significant investment to maintain and grow our public health system, difficult decisions have had to be made to return the ACT Budget to a sustainable footing.
We’ll do this without making deep cuts. The Canberra community expect the government to continue to deliver these critical services not cut them.
We will not slash the public service or cancel much needed infrastructure. That approach does not align with the values of Canberrans or Labor.
Expenditure
Mr Speaker, the Government will make sensible savings by constraining the rate of growth in government expenses, saving $282 million over the forward estimates as we reprioritise expenditure and budget controls.
Through the Machinery of Government reforms, we are prioritising work to ensure that we are working efficiently and in line with the community’s expectations.
Over the next four years, the Government will constrain growth in both employee and non-employee expenditure across ACT Government agencies and directorates to ensure that it is sustainable into the future.
The public service will continue to grow over time, especially as we deliver our commitments to the community to support our hospitals and schools.
Revenue
Mr Speaker, in the Budget the ACT Government has also made the difficult decision to increase revenue to fund the pressures on our hospitals.
The Canberra community is being called on to contribute to the financial sustainability of our health system through a $250 Health Levy. This will be paid in addition to rates, which will increase on average in 2025-26 by 3.75% for residential land.
We will also ask the business community to contribute to the major new initiatives that will drive economic activity through changes to payroll tax.
From 2026-27 we will broaden the payroll tax base by reducing the tax-free threshold to $1.75 million while also reducing the initial payroll tax rate to 6.75 per cent. Our payroll tax-free threshold will continue to be substantially higher than surrounding NSW and businesses with payroll of less than $4 million will continue to pay less tax in the ACT than NSW.
We will also reduce the level of concessions applied to motor vehicle stamp duty for zero emissions vehicles, as the market in Canberra shifts heavily towards them, with the availability of more affordable electric vehicle models.
I want to assure the community that we have not taken the decision to introduce new revenue measures lightly, but it is necessary to balance public finances with community expectations of continued services.
Overall Fiscal Position
Mr Speaker, because of the steps we have taken and strong continued economic growth, we will return the Budget to balance over the forward estimates.
The Budget forecasts a Headline Net Operating Balance deficit of $424.9 million in 2025-26, following our further investment in our public health system, before returning to a surplus of $47.9 million from 2027-28 and growing in 2028-29 to $330.6 million. The Territory’s HNOB as a share of GSP is consistent with other states and territories over the forward estimates.
The Territory’s strong balance sheet will ensure we continue to deliver these services, while net debt and net financial liabilities remain about average compared to other Australian states and territories.
A strong increase in the net operating cash position over the four years to 2028-29, will also ensure that we can continue to deliver key infrastructure improvements to support future community needs, economic growth and jobs.
Economic development and major projects
To support further economic growth and deliver on community needs, the Government will continue to make investments in major infrastructure projects in a way that is targeted and achievable. The total infrastructure program is worth $8.1 billion.
And we will always seek to ensure these projects are funded in partnership with the Australian Government as our two governments deliver for Canberra.
Investments support entertainment, cultural and sporting projects, like a new Canberra Aquatic Centre at Commonwealth Park, planning and designing a new convention and entertainment precinct, and the Canberra Theatre Redevelopment.
We’ll continue further work on the new Northside Hospital and continue investment in public transport infrastructure through light rail.
The Government will continue to shape the infrastructure pipeline to match the delivery capacity of the market, explore different infrastructure delivery models and ensure our investments are targeted to support economic growth.
Arts and night-time economy
We’ll support the night-time economy with discounts on liquor licenses, so that our night-time economy and arts sector can thrive.
We’ll also invest more than $7 million to support local artists and back the creative industries that enrich our city’s identity and economy.
This investment will boost financial support for Canberra’s artists and cultural organisations, progress heritage conservation works at iconic sites, and build momentum for Canberra’s bid to join the UNESCO Creative Cities Network as a City of Design.
We’ll also invest in our local screen and digital gaming industry through funding for Screen Canberra and the Screen and Digital Games funding program.
Climate action and environmental protection
Mr Speaker, Canberrans value their local environment and are ambitious for climate action.
This Budget delivers funding to appoint a Government Landscape Architect and office to lead work on the ACT’s first Landscape Plan.
This will ensure that as Canberra continues to grow into the future we proactively preserve the bush capital we all know and love.
We’re also making investments that lower emissions and deliver energy savings. Supporting more businesses and households to become more energy efficient will help reduce energy bills and set up our city for the future. This includes government action to switch off government gas assets in favour of electric options.
Supporting our community
Mr Speaker, as a Labor Government we will deliver on our commitments to support those most in need.
This will always mean making sure Canberrans can access free public health care and supplying more affordable housing.
This Budget makes targeted investments in cost-of-living support.
We will permanently increase the electricity, water and gas rebate to $800 for over 40,000 low-income households.
We’ll support apprentices with a $250 cost-of-living payment, and a further $250 for first year apprentices for new tools and equipment.
We’ll extend the Future of Education Equity Fund and make one school camp free for public primary school students.
We know that supporting the most vulnerable in our community is only possible because of the community sector.
That’s why we’ll invest over $55 million in community inclusion and support, including $10 million to give an important funding boost to community sector partners.
And we’ll work with them, to tackle the critical issue of responding to domestic, family and sexual violence.
We’ll invest $24.5 million to provide essential frontline services and a further $6 million to Aboriginal Community Controlled and led Organisations to provide culturally safe services.
Community safety
Mr Speaker, everyone deserves to feel safe in the community.
Our police and emergency services are the very first people you call when you’re faced with an unexpected emergency.
To show our commitment to community safety and the frontline service work police do - we will invest $112.9 million in ACT Policing and deliver a real wage rise to all our police officers.
We’re also funding planning for a police station in the Molonglo and a future Emergency Services facility in Casey and investing in the equipment our emergency services use each day.
Delivering for our suburbs
Mr Speaker, at the election we promised to deliver new and renewed infrastructure across our suburbs and invest in better public transport services.
This Budget will provide more funding to upgrade shops, invest in active travel infrastructure, deliver new community sporting infrastructure, better and upgraded playgrounds, and invest in tree planting, mowing and other city services.
We’ll buy an additional 30 new electric buses, to grow our fleet and deliver more services. And we’ll increase services on Sundays from Term 3.
Education
Mr Speaker, I grew up in a family of public school teachers.
Every child of a teacher knows how important their roles are in transforming young lives for the better.
For me, they’ve instilled deep values of social justice and compassion - values that define my approach to this Budget.
Before I entered politics, I worked towards getting the best outcomes for young children through early childhood education and I’m proud to be part of a government that recognises that through our commitments to early childhood education and free three-year-old preschool.
Now as a father to my own daughter, Maeve, I know how important it is that we invest in life-long learning from those first days in early childhood education right through formal schooling to university and vocational education and training.
This Budget will invest a further $138 million in education and training to support all Canberrans getting an education. This will include more investment in our public schools, through new infrastructure and more programs that support vulnerable children.
It also provides funding for the new CIT Woden campus and more investments in free school meals and free school camps.
In addition to this, the budget delivers better literacy and numeracy outcomes through the Better and Fairer Schools Agreement in partnership with the Australian Government.
Conclusion
Mr Speaker, Canberra is a progressive and inclusive place, and this budget reflects our community.
The Government is committed to ensuring Canberrans have the high level of services they expect, while we continue to invest in our growing city.
The Budget delivers a record investment in health and makes a landmark investment in housing supply. It strengthens skills and education while providing support to the Canberrans who need it most.
The Budget funds the infrastructure our city needs, ensuring we deliver on the commitments Labor made at the election.
It puts our finances on a sustainable path, by taking responsible expenditure and revenue decisions.
Our Budget is an investment that will sustain local jobs, drive economic growth and ensure that current and future generations enjoy the same high quality of life our city is known for - the world over.