The household assistance is structured with care to deliver broad benefits across the community,scaling up a similar energy subsidy last year so that this year’s payments go to every household regardless of income.
If you pay your electricity bills every quarter,you should expect a $75 rebate every three months,so your energy price is lower and you benefit by $300 over the year.
The first round of the Energy Bill Relief Fund cut electricity bills for more than 5 million households,but it offered only $1.5 billion in federal money and expected matching funds from the states and territories.
Treasurer Jim Chalmers and Finance Minister Katy Gallagher have chosen to go it alone – some states were not ready to join – and more than double the outlay.
The first reason the household package makes sense is that it is simple and practical. The federal energy subsidy goes to families using existing rebate schemes that cut an electricity bill before it arrives in a mailbox.
The second reason is economic – and hugely contentious. The scheme lowers the retail price for electricity and Treasury estimates this will reduce inflation. While some economists dispute this,the Reserve Bank said in February last year that increases in wholesale energy costs were “expected to be dampened” by the first energy price relief plan. When the Australian Bureau of Statistics issued the September-quarter inflation figures last year,it named the energy plan as a factor in keeping prices down.