26 March 2025

2025-26 Federal Budget Wrap

Summary of the 2025-26 Federal Budget from the perspective of Australian applied science, technology and engineering policy.

Summary of the 2025-26 Federal Budget from Australian applied science, technology and engineering policy perspective

Overview 

This pre-election Federal Budget was limited in scope, with few new announcements making an appearance in the final release of the Budget papers. The headline item was a modest income tax cut for all taxpayers – which was in fact a new announcement on Budget night. Other Government priorities making an apperance in the Budget include: extending electricity bill rebates, increasing Medicare bulk billing, and numerous transport infrastructure commitments. 

The Budget does not renew commitments to supporting the Pathway to Diversity in STEM, Universities Accord and Research & Development reviews – all landmark STEM and education initiatives of the current Government. The key innovation commitment in this Budget is green metals, building on the Future Made in Australia package detailed in the previous Federal Budget. 

Read ATSE’s response to the Budget, and Pre-budget submission

Details of announcements in portfolios of interest to ATSE are listed below. 

Alignment with ATSE’s recommendations 

Some budget measures match recommendations made by ATSE in recent submissions and reports, including: 

  • Developing a National Food Security strategy, as recommended in ATSE’s Pre-budget submission echoing the parliamentary inquiry into food security –  $3.5 million over 2 years from 2025-26  
  • Clean Energy Finance Corporation funding to invest in renewable energy, energy efficiency and low emissions technologies, aligning with ATSE’s advice on investing in mature low-carbon technologies for the energy transition 
  • National Water Grid Fund infrastructure projects for regional areas, including funding for First Nations communities’ water infrastructure, a need highlighted in ATSE’s Closing the Water Gap explainer – $87.7 million over three years from 2025-26 
  • Additional water infrastructure upgrades (potable and waste water) for remote Torres Strait communities, also relating to ATSE’s Closing the Water Gap explainer 
  • Funding for voluntary water purchases for the Murray-Darling Basin, a short-term approach endorsed by ATSE’s submission on Delivering the Murray-Darling Basin Plan –  three years from 2025-26 

 

Additional Budget announcements of relevance to ATSE

Industry and Science 

  • $2 billion over 19 years to fund Green Aluminium Production Credits 
  • $1 billion over 7 years for a Green Iron Investment Fund, including $500 million for Whyalla Steelworks. A further $219.3 million to stabilise Whyalla Steelworks 
  • 10% refundable tax offset being established for the downstream refining and processing of critical minerals 
  • $55 million over 4 years for CSIRO to continue research ($45 million) and address the impact of invasive species ($10 million) 
  • $47.9 million to address funding shortfalls in the Square Kilometre Array 
  • $34 million for remediation and operations funding for the National Measurement Institute 
  • Upgrade to biosecurity capabilities of the Australian Centre for Disease Preparedness 
  • Northern Endeavour oil rig decommissioning in 2025-26 
  • Reduction to the Research and Development Tax Incentive, reflecting a lower-than-expected number of claims 

Agriculture 

  • $3.5 million over two years from 2025–26 to develop a National Food Security Strategy 
  • $6.8 million in 2025-26 for agricultural export and trade activities, including international engagement 
  • $23.8 million over three years from 2025-26 for agricultural trade events sponsorships 

Water and environment 

  • Funding over three years from 2025–26 to continue implementation of the Murray Darling Basin Plan through additional voluntary water purchases that will contribute towards better environmental outcomes under the Basin Plan. The budget amount is not published as this would impair the Commonwealth’s position in negotiating contracts 
  • $87.7 million over three years from 2025–26 to deliver new water infrastructure projects 
  • Clean Energy Finance Corporation funding to invest in renewable energy, energy efficiency and low emissions technologies 
  • $212 million over four years from 2025-26 for bush and ocean conservation programs 

Defence capability 

  • $61.7 million in 2025–26 to continue to provide regulatory, safety and policy advice in support of Australia’s acquisition of a conventionally armed, nuclear powered submarine capability 
  • $1.9 million in 2025–26 for the Department of Employment and Workplace Relations to support the delivery of skills and training initiatives for the nuclear-powered submarine program 
  • The Australian Naval Nuclear Powered Submarine Regulator (ANNPSR) agency will be created in 2025-26 

Education and skills 

  • $407.5 million over 4 years from 2025-26 (and $7.2 billion from 2029-30 to 2035-36) to jurisdictions that have signed Better and Fairer Schools Agreement (Full and Fair Funding 2025-2034) Bilateral Agreements  
  • $7 million to continue delivery of 6 science, mathematics and literacy early years and schools programs 
  • $35.6 million over four years from 2025-26 for 100 new commencing Commonwealth Supported Places (CSPs) a year in medicine for First Nations medical students from 2026, increasing to 150 CSPs from 2028 
  • A new $16.4 million tripartite pilot grants program. The program will create partnerships with peak employer organisations and state and territory Trades and Labour Councils who are uniquely placed to help identify new ways to make workplaces safer, more respectful and more equitable for women in traditionally male-dominated sectors 
  • $16 billion to reduce all outstanding Higher Education Loan Program (HELP) and other student debts by 20 per cent 

Health 

  • $158.6 million over five years from 2024–25 to support research and translate medical research to clinical practice, including $7.8 million in 2024–25 for increased operational costs for the National Health and Medical Research Council and funding to support an intergovernmental agreement for the cooperative governance and development of the National One Stop Shop for Clinical Trials and Human Research 

Digital technologies 

  • Up to $3 billion over seven years from 2024–25 to NBN Co to upgrade the remaining 622,000 National Broadband Network (NBN) premises on the national fibre to the node (FTTN) network with NBN Co also contributing more than $800 million to the project 
  • $5.3 million over four years from 2024–25 to continue the delivery of free broadband for up to 30,000 unconnected families with school aged students under the School Student Broadband Initiative 

International engagement 

  • $20 million over four years from 2025–26 to support increased economic engagement with India, including $16 million to establish an Australia‑India Trade and Investment Accelerator Fund and $4 million to extend the Maitri Grants Program to support exchange and collaboration between Australian and Indian cultural, education, research and business communities. 

Analysis – Budget in Reply 

The Budget in Reply, delivered by the Leader of the Opposition, the Hon Peter Dutton MP, focused on energy policy, with a new gas reservation scheme announced. The Coalition’s gas reservation scheme would require gas companies to reserve gas from new gas projects for Australian markets, with an aim to use gas as a transition fuel while a domestic nuclear power industry is established.  

The gas policy would require new skills, including oil and gas pipeline engineers and petroleum engineers. The Coalition’s nuclear power policy would also require growth in the number of nuclear engineers and technicians, as well as university teaching and research staff qualified to teach this new nuclear workforce – these key levers were not addressed or articulated. Programs such as ATSE’s Elevate: Boosting Diversity in STEM can support development of the future skilled engineering workforce.

The Budget in Reply also notes the Coalition would not continue Labor’s policy for production tax credits for green hydrogen. 

ATSE is pleased to see the Budget in Reply also commits to continuing support for the Medical Research Future Fund, and to encouraging business-led tech-powered growth across the economy including in intelligence, cybersecurity, space, and nanotechnology. 

ATSE would have liked to have seen more focus on investing in the people and infrastructure driving research and development: today’s innovations are the key to future Australian growth and resilience. There was a missed opportunity to commit to the outcomes of the Strategic Examination of Research and Development. The Budget in Reply does not accelerate the energy transition, nor does it explicitly address climate change mitigation and adaptation. If implemented, the additional emissions profile of the gas reservation policy would need to be considered within the context of the Paris Agreement. 


 

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