Huge tranche of cost of living measures to kick in from New Year’s Day as Treasurer spruiks relief

A tranche of cost of living measures are set to kick in from January 1, which Treasurer Jim Chalmers says will provide a boost to struggling Australians.

Youth Allowance recipients with dependants will get a payment bump, with single recipients getting an extra $30.60 and partnered recipients getting an additional $24.30.

Hundreds of thousands of aged care workers will also receive a 50 per cent increase in their award wages, with another 50 per cent coming in October 2025.

Among the measures is an indexation freeze Pharmaceutical Benefits Scheme (PBS) co-payments.

This means the share Australians pay for medicines covered by the PBS will not increase with inflation – a move estimated to save close to half a billion dollars over the next five years.

Dr Chalmers said on Monday the Albanese government was providing “meaningful and responsible cost of living help”.

“Many Australians will get a bit more help with the cost of living from New Year’s Day,” he said.

“Our major focus in 2025 is people who are still doing it tough even though inflation is coming down and wages are up.

“The meaningful and responsible cost of living help which began in 2024 will be the key priority into 2025 as well.”

The federal government has already rolled out numerous measures aimed at curbing the rising cost of living, such as energy bill credits.

But critics have charged that the relief efforts have been more mitigative than preventive.

Meanwhile, the Coalition has accused the government of spending too liberally and actually pushing inflation up.

The Reserve Bank has acknowledged spending at all levels of government has been inflationary, but that it was not the main driver.

Dr Chalmers said the federal government was “helping people earn more and keep more of what they earn”.

He added every taxpayer was “receiving a tax cut, medicines are cheaper, youth and carer support is higher for a million Australians, and more people can study at TAFE for free”.

“The biggest risk to household budgets in 2025 is Peter Dutton, who’d come after Medicare and wages again, push electricity prices up, and risk the progress we’ve made together in our economy,” Dr Chalmers said.

With Australians forking out record amounts on groceries for less and housing costs continuing to climb across the country, cost of living will be top of mind when voters cast their ballots next year.

Anthony Albanese has not called next year’s federal election, but May 16 is the latest it can be held.