David Koch has slammed Labor’s plan to extend its energy bill rebates for all n households, arguing the handouts should only go to those most in need.
Prime Minister Anthony Albanese has defended his decision to extend a $150 energy bill rebate to even the richest households – plus an estimated one million small businesses – rather than apply a means test.
Mr Albanese announced the decision on Sunday after the n Energy Regulator estimated household electricity bills would skyrocket by up to nine per cent for residents in NSW, Queensland and Victoria from July 1.
Compare the Market economic director and former Sunrise host David Koch said limiting the rebates to battlers would see them receive bigger rebates, while reducing the $1.8billion that taxpayers are being slugged to fund it.
‘For some people, $150 may be a bit of pocket money to take on a holiday – for others it could mean having a full fridge and enough to feed the family for a week,’ he said.
‘By applying a means test, the government could direct an even larger portion of that $1.8 billion to the people who need it most.
‘I don’t need an energy rebate, but I would be very happy to see that money go to someone who does need it.’
From July 1, households and eligible businesses will have the $150 rebate automatically applied to their quarterly bills, with the government handing over public money to electricity retailers to make up the full amount.
The rebate is less generous than its $300 predecessor applied from mid-2024.
The n Bureau of Statistics estimated the previous rebate had reduced the amount paid by electricity customers by about 25 per cent.
Mr Albanese defended the rebate on Tuesday, arguing that only welfare recipients would be eligible if the rebate was means-tested.
‘We can have two options because of the way that the rebates work,’ he told ABC Radio National on Tuesday.
‘You can either just give them to people who are welfare recipients, or you can give them to all ns.
‘What we want to make sure is that we deliver them to working ns who are struggling because of cost-of-living pressures, and so it is far more efficient to deliver in the way that we have to make sure that every n household receives this support, because that is what is deserved.’
Mr Koch rejected that argument, saying employed people received childcare subsidies, and electricity rebates could work the same way.
‘Childcare subsidies are means-tested. I don’t see why the same household-income benchmark couldn’t be applied here,’ he said.
Childcare subsidy entitlements are calculated as a percentage derived from household incomes.
Households with incomes below $83,280 are entitled to 90 per cent of the available child care subsidies and decreases by one per cent for every additional $5,000 of income up to $533,280.
Other subsidies are also available to non-welfare recipients in including private health insurance rebates.
Grattan Institute Energy and Climate Change Deputy Program Director Alison Reeve told Daily Mail that neither proposal was a win-win.
‘David Koch is correct that $150 means more to people on lower incomes than on higher incomes,’ she said.
‘We also know that low-income people spend proportionally more in energy than high-income households, because they don’t have spare cash to invest in things that would save them money (like solar and batteries, or switching from gas to electricity).
‘But the PM’s correct that not everyone who has a low income is receiving payments from the government.
‘In other words, if you want to help low-income households either you have to accept that some are left out (Kochie’s approach) or accept that some will be overpaid (PM’s approach).’
Independent Senator Jacquie Lambie also called for more targeted energy rebates.
‘What do I need 150 bucks for? What a waste of money,’ she told Sky News.
‘Why am I getting that money, mate? Because quite frankly, I’d rather my $150 make $300 down to the next person below me that’s doing it really tough,’ she told Sky News on Monday.
‘Not means-testing and throwing your money out there, taxpayers’ money out the way that they are, like they’re a packet of lollies, is absolutely disgusting.’
With an election looming, the Coalition said it ‘won’t stand in the way’ of another round of rebates.
However it said handing over public money to electricity retailers was an unsustainable short-term measure that did nothing to address the root cause of why has expensive power despite vast supplies of coal, oil and gas.
Over the longer term, Mr Dutton has committed to reinstating former prime minister Scott Morrison’s ‘gas-fired recovery’ plan while investing in two nuclear plants by 2037 and seven by 2050.
Labor instead would continue to invest in renewable energy sources while incentivising private investment under its Future Made in package.
After three years of energy bill relief payments, Ms Reeve said the justification had worn out.
‘In the first year, the policy could perhaps be justified because it could be done quickly in response to a sudden sharp rise in prices,’ she said.
‘But the government and the Opposition have now had two additional years to come up with idea that permanently insulate consumers from bill shocks – like helping household upgrade appliances, install ceiling insulation, switch away from using gas, or install rooftop solar.
‘If they’d spent the money on that, targeting households who need it most (low income and renters), then we wouldn’t need bill relief in the future. Instead, both sides seem to be stuck in a cycle of cash handouts.’
The energy debate is just the latest battleground in the ongoing pre-budget posturing as Treasurer Jim Chalmers prepares to deliver Tuesday’s federal Budget, in which the Albanese government is forecast to go into deficit for the first time.
Despite going back into the red, Dr Chalmers has continued to emphasise the government’s ‘responsible economic management’.
‘s gross national debt is at its highest in history, sitting at $940billion for 2024/25, although that is $177billion less than the dire 2022 predictions.
‘We’re paying down Liberal debt and the budget will show that’s saving taxpayers tens of billions of dollars,’ Dr Chalmers said.
‘In dollar terms, Labor’s responsible economic management has delivered the biggest budget turnaround in a parliamentary term in history.’
Ahead of the Budget, Opposition Treasury spokesman Angus Taylor has slammed the government for what he characterised as wasteful spending and a ‘tax grab’.
At the same time, however, Mr Taylor said rising cost-of-living and increasing debt would produce a ‘lost decade for n families’.
‘Right now the plan for the Budget, or the last Budget indeed, was that we wouldn’t get back to the standard of living we had when we were in government, the Coalition was in government, until 2030 or beyond,’ he said.
‘This will be a lost decade for n families.
‘So the first test for this budget is to restore our standard of living quickly and get back on the pathway to prosperity for ns that we’ve been used to in this country.’