PM to promise new cost-of-living relief and student health subsidies ahead of next election
Prime Minister Anthony Albanese will prepare his bid for a third term with the promise of more expensive cost-of-living measures to address the financial stress that has fueled One Nation’s rise, while expanding a scheme to pay healthcare workers while they work.
But Labor ministers are playing down the prospect of a tax on gas exports ahead of a fight over the popular proposal at the national conference; This indicates tension within Labor ranks over how aggressively Albanians are pursuing populist aims.
In a speech to Labor loyalists on Thursday that Albanese will use to frame the election’s battle lines, the prime minister will invoke 135-year-old Labor tradition on practical responses to raise workers’ living standards rather than “rage against a system without a plan to fix it”.
Albanese will say that “people have been given every reason to feel that the economy is not working for them” as he seeks to boost the government’s political fortunes and meet pessimistic voters where they are.
“This is deeper than sentiment; it’s a reality facing people,” he will say, according to a preliminary version of his speech, noting that he is navigating “rough seas” after a series of economic shocks and oil crises caused by the Middle East war.
“This is how we prove that the status quo is not set in stone. It’s how we show Australians that their hard work will pay off, that their efforts are worth it. It’s how we show that the flaws in the system can be fixed.” [and] Labor is delivering the real change Australians deserve.”
His emphasis on helping voters pay their bills, which he says is a key contrast to his rivals, suggests Labor will test fiscal boundaries and focus on easing costs of living in its next two pre-election budgets, after spending political capital on revenue-raising tax concession changes this year.
Albanese does not mention One Nation by name, but his advice to reject populist politics underscores the topsy-turvy political dynamic with two years until the next election. Albanese’s party has fallen 6.5 percentage points in first preference votes more than a year after its historic victory, with the Coalition sitting in third place, narrowly ahead of Pauline Hanson’s party, according to Poll Bludger’s average of major polls.
Albanese will take a veiled jab at Hanson’s recent spats on race relations, arguing that the rising populist leader “blames people who can’t defend themselves” and supports a form of politics that “builds nothing”.
In the face of criticism from Opposition Leader Angus Taylor about a sprawling and inefficient care sector, Mr Albanese will announce on Thursday that Labor is providing financial support to healthcare students studying as part of their degree. Labor did not cover the cost of the policy.
This will offer a weekly stipend to thousands of students in physio and occupational therapy, clinical psychology, pharmacy and podiatry, speech pathology, audiology, radiography, rehabilitation therapies and paramedics.
The government first announced in the 2024 budget that it would pay weekly payments to students undertaking practical placements for teaching, nursing, midwifery and social work qualifications; this is one of the cost-of-living pitches to young Australians ahead of the 2025 election. The indexed subsidy is almost $340 per week.
But allied health groups and young students in the health professions wanted the prac payments to be given to them. The issue was taken up in parliament by independents Helen Haines and David Pocock.
Parliamentary Budget Office modeling commissioned by Haines found that extending the payments to health and medical students, including psychologists, paramedics and physiotherapists, would cost $290.4 million by the 2028-29 financial year, on top of the $505.3 million budgeted for the existing program over the same period.
Albanese said the program was changing the lives of students who were struggling to make ends meet during college, moving in with their parents or juggling part-time jobs on placements to pay rent.
A campaign by MPs including Labour’s Ed Husic, unions, the left-wing Australia Institute think tank and online creators to impose a 25 per cent export tax on gas companies has caused a headache for Albanese.
This issue came to the public agenda when Albanese was trying to obtain fuel from Asian neighbors at the beginning of the US and Israel’s war with Iran. Many Asian fuel-supplying countries rely on Australian gas exports, so the Albanians nixed the idea.
But part of the party’s draft platform says Labor will ensure Australians “get a fairer return on their natural resources”, opening the door to the tax later this term. Finance Minister Jim Chalmers and others in the government have been open to new revenue from resource companies.
Renewed conflict in the Middle East means the issue of fuel shortages could come to the fore again, increasing pressure on Alban to downplay the new tax, as he did at the weekend. Ministers also tried to curb rumors about the tax.
Environment Minister Murray Watt said of Nine’s: “The government’s position has been that we do not support a gas tax.” Today program on Wednesday.
Paul Sakkal is the Chief Political Correspondent. He has previously covered Victorian politics and won the Walkley award as well as the 2025 Press Gallery Journalist of the Year award. Contact him securely on Signal @paulsakkal.14.Connect with: X or email.
Natassia Chrysanthos is a Federal Political Correspondent. He has previously reported on immigration, health, social issues and the NDIS from Parliament House in Canberra.Connect with: X or email.
