The Treasurer’s opening statement in the budget overview places the blame for our current economic woes on the war in the Middle East. Energy, technology, intergenerational equity, and home ownership are the key words used to justify emptying your wallet. Out of the six opening paragraphs, five mention the Middle East and the global oil shock.

The budget byline is ‘Reform and Resilience’. Clayton’s reform, with none of the resilience home-grown. A Fuel and Fertiliser Security Facility costing $7.5 billion will secure overseas fuel instead of Australia producing its own. It’s like using our money for a beggar’s stash rather than developing our productive capabilities.

The fuel excise will be ‘more than halved’ for three months, instead of being replaced with a fairer way to collect revenue. The heavy vehicle road user charge has been reduced to zero for three months, too, but truckies want the fuel excise canned for good. Earlier today, the trucking industry group Loadshift warned the government that electric trucks are a non-event. Meanwhile, $40.5 million will be spent next financial year to ‘accelerate the electrification of Australia Post’s delivery fleet’.

It doesn’t take too much investigation to notice the irony in the budget papers. On the one hand, we are lowering the standards for imported fuel. On the other, $4 million will be spent over the next three years to ‘develop a green fuel bunkering strategy to support the government’s existing $1.1 billion Cleaner Fuels program’.

What really gets my goat is all the fuss about fertiliser. We’ve been bored to tears by Chris Bowen banging on about green hydrogen. Like fertiliser, hydrogen’s feedstock is ammonia. Whatever happened to all the ‘producing green hydrogen’ hype? Looks like our ammonia will come from overseas, too.

A budget paper graph compares the fall in global oil production from the Middle East Conflict with that of the Yom Kippur War of the 1970s. It’s basically double. In response, some $1.1 billion of taxpayers’ money will be used to subsidise domestic production of low-emissions fuels. For the ideology-free fuel that we actually need, there’s no mention of how much a cap-in-hand approach will cost. But given the price of electricity from the ‘free’ sun and ‘free’ wind, I’m tipping we’re setting ourselves up for future pain yet again.

The national reserve of diesel and jet fuel will be increased to 50 days. It hardly seems enough for an oil-abundant and dependent nation. While our two remaining oil refineries will receive government support, $10 million will be used for feasibility studies for increasing our refining capabilities. Feasibility? Both Labor and the Coalition helped get us here in the first place. We don’t need feasibility studies, we need increased refining capabilities. Meanwhile, the government will continue to support the ‘Offshore Decommissioning Directorate’. I think that says it all.

And 100 million more litres of petrol per month? This will be achieved by lowering fuel standards. Hardly something to celebrate when it’s all meant to be about the environment. We’re outsourcing our virtue signalling yet again by buying dirty fuel from somewhere else.

If you’re worried about the fuel crisis, don’t despair. Labor has launched the National Fuel Security Campaign to ‘raise awareness of the National Fuel Security Plan and to help Australians feel prepared and supported’. It’s part of a $54.7 million package to manage Australia’s fuel security. I feel better already.

Meanwhile, the Treasurer claims Labor is saving more than it is spending. But when I look at the gross debt figures, national debt will be more than $1 trillion next financial year, and out to $1.249 trillion in 2030. If I was saving more than I was spending, I would expect my gross debt to decrease. But I’m merely a political scientist with a PhD from ANU, so what would I know…

The spin is in the detail. The Treasurer claims there will be ‘lower deficits and debt in every year’. But he means lower when compared with the Mid-Year Economic and Fiscal Outlook and the former Coalition government’s forecasts that Labor ‘inherited’ (over four years ago).

Finance Minister Katy Gallagher looked out of her depth when answering questions from journos. They asked what’s changed in the housing market to justify the changes to negative gearing. She mumbled something about ‘better off than what we inherited’.

The reality? National debt is increasing, no matter how you spin it.

Inflation is forecast to remain at 5 per cent until the end of the financial year. The Treasurer blames this entirely on the war in Iran. Yet many mortgage repayments have nearly doubled since Labor came to power. The RBA’s recent comments do not support the government’s spin. Only your bank account reflects the economic reality. You should expect more interest rate rises because 5 per cent is well outside the RBA’s target inflation range.

Growth is falling from 2.25 per cent to 1.75 per cent next financial year. It won’t ‘recover’ until 2028 when growth is forecast to return to 2.25 per cent. Hardly encouraging figures for one of the world’s most resource-abundant countries.

Labor has finally achieved its aim to attack discretionary trusts. A vehicle that has been used for generations to protect assets and distribute income, Labor wants businesses to restructure away from the family trust. Trusts will pay a minimum of 30 per cent tax, and trustees will be responsible for paying the tax and issuing non-refundable tax credits. Think franked dividends back when you couldn’t receive an actual refund of the franking credits.

Labor is placing a huge burden of red tape on small businesses. Their solution? Get out of your family trust. Labor recommends you use the Australian Small Business and Family Enterprise Ombudsman from 1 January 2027. They’ll help you adopt Labor’s preferred business structures.

Talk about ideology out of control. Labor has put some 840,000 discretionary trusts on notice. Trusts are another of Labor’s ideological pet peeves and now they’re hammering in the coffin nails. The result? It is expected to bring in $4.5 billion in additional tax receipts. From small business.

Negative gearing has been curtailed. Let’s hope Labor’s plan goes the way it did last time they meddled with it. You will only be allowed to negative gear new residential builds.

Capital gains tax has changed, too. The 50 per cent capital gains tax discount, introduced in 1999, has been removed and the indexed cost base has reappeared. There will also be a minimum tax on capital gains of 30 per cent. So if you thought you could cash in on your smart retirement planning, your hard work, and reap the rewards, then no. In the Treasurer’s official words:

‘The introduction of the minimum tax reduces the benefit of taxpayers deferring capital gains realisation to years where their marginal tax rates are low. It ensures their gains are subject to a tax rate closer to the rate they faced during their working life…’

Nothing says aspiration like Labor taking a bigger slice of your retirement pie. I’m not exaggerating. His very next words are:

‘Recipients of means-tested income support payments, such as the Age Pension or JobSeeker, will be exempted from the minimum tax if they receive any payment in the financial year in which they realise the capital gain.’

It’s clear that Labor doesn’t want you to be independently wealthy. Labor wants you to be dependent on the government.

Attacking family trusts and changing the rules for capital gains and negative gearing are not reforms. In my opinion, they are ideological abuses of power. They are also broken promises.

In the lock-up briefing, the Treasurer reckoned he’s focusing on the issues affecting young people. I reckon he has dragged out Labor’s tired old pet-peeve playbook. One can imagine the Labor Party clinking glasses in the backrooms singing ‘Solidarity Fore-ver’. They never would have dared do this if we had a competent Opposition.

In a classic bureaucratic move, instead of Labor increasing the tax-free threshold, they are introducing the ‘Working Australians Tax Offset’. It effectively gives workers a $250 increase to their tax-free threshold. This includes sole traders. If Labor had just increased the tax-free threshold, they wouldn’t need a Tax Explainer for it. Add to that the automatic $1,000 tax deduction, this is the ultimate reform you have when you’re not having a reform.

Rather than focusing on a reduction in inflation and an increase in productivity as a way to increase home ownership, Labor will spend over $2 billion on housing and $2.1 million on research into how to make housing more affordable. But they will spend $56.4 million for the Treasury to support the ‘Homes for Australia plan and for a public campaign to inform taxpayers of the changes to the tax system’.

The awareness campaigns continue unabated. Australia’s national security and social cohesion will be strengthened by $32.6 million next financial year for public awareness campaigns. Everyone is aware that rampant immigration and our self-loathing education system are the biggest problems. I bet the campaign mentions neither.

Teachers will have access to some $20 million over four years from 1 July 2026 to teach the Together for Humanity program. The budget papers claim this will ‘address social cohesion, including antisemitism and racism, through face‑to‑face intercultural programs’. I reckon a ban on teachers and public servants wearing and promoting political propaganda would be a real fix that costs us nothing.

To be fair, combatting antisemitism is mentioned frequently. For a change, there was no mention of Islamophobia in the same breath. But I reckon One Nation just put the skids up Labor, so there’s that.

It hasn’t stopped the government using some of a $10 million allocation to expand ‘the Special Envoy’s United Nations Educational, Scientific and Cultural Organisation teacher training’. The last thing we need is more of that moribund institution influencing our kids.

Overall, there were really no surprises in the budget. Veterans get the raw prawn again with Labor achieving savings of $779.5 million over the next five years, ‘through better targeting of services for veterans and their families’. Translation: Veterans get less.

I have no idea why we bother with the budget lockup. Everything was leaked beforehand. The Treasurer was even releasing quotes on Monday speaking as if it was Tuesday. I reckon the cost of the lockup should be disclosed. It’s all smoke and mirrors anyway. A bit like our household budgets at the moment. But at the end of the day, your wallet tells the real story.

The Treasurer said in his briefing this afternoon:

‘This Budget is ambitious in the face of adversity … making sure that opportunity, aspiration, and ambition are central … it’s all about getting compliance costs down…’

If your ambition is to lean on the government, you’re a loser, and this budget’s for you. If you want opportunity and aspiration, you’re the biggest loser.

For Australia’s 840,000 family trusts, however, the headaches are only just beginning. Never mind the war in Iran. With this budget, the Treasurer has gone to war with Australian small businesses.

Dr Michael de Percy @FlaneurPolitiq is the Spectator Australia’s Canberra Press Gallery Correspondent. If you would like to support his writing, or read more of Michael, please visit his website.