Weekly Wrap Up – 12 December 2025
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Mark Butler unveiled Labor’s most courageous social policy reform in four years of Government at the National Press Club this week. The overhaul of the NDIS will have a material impact on thousands of participants, the workers who support them and virtually the entire disability ecosystem. As Mark Butler stated plainly:
“The NDIS costs too much and is growing too fast… Unless we take action to make it sustainable, it simply will not be there in the future for the Australians who need it most”.
The funding cuts and system redesign went further than expected. Beyond reducing growth, the Government will more tightly define who the scheme is and isn’t for. Participant numbers, now sitting at 760,000, will be reduced to 600,000 by the end of the decade. A new standardised assessment will be implemented from 1 January 2028, which will determine a person’s functional capacity; a significant shift away from diagnosis-based eligibility. Spending growth will be aggressively reined in – from 10 per cent annually to a below-inflation figure of 2 per cent over the next four years. That adjustment significantly reshapes the scheme’s trajectory: projected costs of $70 billion by 2030 are expected to fall to $55 billion.
But this is not just about headline savings. The reform package also introduces new funding boundaries to dictate which supports sit inside the NDIS and which should be delivered through other services – and other jurisdictions – like health, education, and housing systems. There is a clear expectation from the Federal Government that the States and Territories will return to disability service provision, in line with the 2023 and 2026 National Cabinet agreements.
The Government is intent on returning the NDIS to its original purpose of supporting people with significant and permanent disability. Equally critical objectives are reducing the ballooning budget impact and retaining the scheme’s social licence.
When Parliament returns in May, these sweeping legislative reforms will likely pass with the support of the Coalition, despite community concerns. The real challenge lies in implementation. Against the backdrop of delays with Thriving Kids, reticence and resistance from the states, and a bureaucracy already stretched with aged care reform, Mark Butler’s announcement this week is really just the beginning.
Top talking points
National Cabinet Meeting: Anthony Albanese convened a meeting of the National Cabinet to evaluate the status of the National Fuel Security Plan and NDIS reforms.
Energy Ministers Meeting: Chris Bowen convened a meeting with Energy Ministers, the Climate Ministerial Council and relevant New Zealand counterparts to discuss the approach to the fuel crisis.
National Press Club: Mark Butler addressed the National Press Club, outlining measures to improve the sustainability of the NDIS and investment in aged care.
eSafety Updates: Julie Inman Grant issued legally enforceable transparency notices to major gaming platforms, including Roblox, Minecraft, Fortnite and Steam, requiring them to provide details on what safeguards are in place to prevent child grooming, online sexual exploitation and youth radicalisation.
AUKUS Developments: AUKUS is reportedly[paywall] facing uncertainty as the United States signals that nuclear-powered ballistic missile submarines – not the Virginia-class boats – are its priority, raising doubts about delivery and reliability.
Polling: Resolve Polling shows[paywall] Labor leading the Coalition 55–45 on a two-party preferred basis. Support for One Nation has slipped to 22 per cent, down from 24 per cent in March.
Making headlines this week
Fuel Security Updates
Gas Tax Debate
Australia’s debate over taxing gas exports is intensifying ahead of the 2026–27 Federal Budget, exposing divisions within government and the energy sector more broadly. Critics argue multinational producers are undertaxed, fuelling proposals for an export levy or windfall-style tax. This follows hearings by the Greens-led Senate Select Committee on the Taxation of Gas Resources. Former Treasury Secretary Ken Henry dismissed incremental reform on the matter, urging policymakers to “simply just do it” on stronger taxation. Pressure has also been amplified by commentary from Punters Politics, reflecting voter frustration that the government is not acting in the public interest. Despite internal pressure from his caucus – including Ed Husic – Anthony Albanese cautioned that amid an ongoing fuel crisis, now is not the time to raise taxes on LNG exports to key trading partners, citing risks to investment and Australia’s fuel security.
Things to watch
28 April: The Australian Financial Review will host the Workforce Summit 2026 in Sydney.
28 April: James Paterson will address the National Press Club, discussing the Coalition’s approach to defence.
29 April: The Australian Bureau of Statistics will release CPI data.
29 April: Hugh de Kretser will address the National Press Club.
2 May: The Nepean state by-election will be held.
Treasury Consultations and Superannuation Performance Test Developments
Treasury opened consultation on draft legislation to introduce a $1,000 instant tax deduction for most taxpayers, delivering on the Federal Government’s 2025 election commitment.
Treasury is also consulting on reforms that would allow the ACCC to oversee pricing for cash distribution services and set minimum service standards. The RBA would also be empowered to prepare for and respond to major disruptions in cash supply.
Jim Chalmers flagged potential changes to the superannuation performance test, with a Treasury discussion paper expected imminently.
Trilateral Defence and Procurement Moves
Australia, Japan and the United States entered a new trilateral Defence Science and Technology agreement to strengthen the testing and certification of advanced composite aircraft materials by sharing experimental data and comparing modelling outcomes.
Pat Conroy announced plans to more than double investment in counter-drone capabilities over the next decade, with up to $7 billion allocated under the Integrated Investment Program. Two initial contracts for Australian-made, next-generation counter-drone platforms have already been confirmed as part of this expansion.
The Australian and Japanese Governments signed contracts for Australia’s first three general-purpose frigates, with the first upgraded Mogami-class frigate, built by Mitsubishi Heavy Industries, scheduled for delivery to the Royal Australian Navy in 2029.
National Reconstruction Fund, Environmental Approvals, and Diesel Refinery Funding Updates
In efforts to support businesses facing global disruptions, Jim Chalmers allocated $6.15 billion through the National Reconstruction Fund to fast-track zero-interest concessional loans. This includes a $1 billion Economic Resilience Program, a $5 billion Net Zero Fund, and a $150 million Forestry Growth Fund to strengthen supply chains, manufacturing, and decarbonisation.
Murray Watt and Western Australian Premier Roger Cook signed a Memorandum of Understanding (MoU) to progress a bilateral agreement to remove duplicate environmental approvals, ahead of reforms to national environment laws taking effect by 1 December.
The Queensland Government committed $25 million to support renewable diesel production at Ampol’s Lytton refinery. The funding will modify an existing diesel hydrotreater to enable co-processing with renewable feedstocks, delivering Australia’s first domestic production of second-generation, low-carbon liquid fuels.
Microsoft AI, Western Sydney Airport, and eSafety Developments
Tim Ayres signed a new MoU with Microsoft to deepen collaboration on AI. He welcomed Microsoft’s $25 billion investment in Australia, supporting its AI-enabled economy and training of three million workers nationwide.
Catherine King unveiled new flight paths for Sydney, set to take effect from 9 July, as the first flights prepare for landing at Western Sydney International (Nancy-Bird Walton) Airport.
eSafety and the Office of the Australian Information Commissioner signed a MoU to ensure a coordinated, proactive regulatory response to growing online safety and privacy risks.
Fair Work Commission Decision, Private Health Rebate, University Moves
The Fair Work Commission introduced Australia’s first Road Transport Contractual Chain Order (RTCCO), requiring businesses that outsource transport to update freight rates fortnightly in line with fuel costs. The RTCCO applies broadly across Australia’s supply chains and will remain until diesel prices fall below $2 per litre.
At the National Press Club, Mark Butler announced the removal of the private health insurance rebate for Australians aged 65 and over, with savings redirected to a $3 billion aged care package to meet rising demographic pressures.
Jason Clare launched a FEE-FREE Uni Ready Best Practice Guide and confirmed an additional $1.1 billion over 10 years to expand bridging courses for disadvantaged students entering university.