Regional Australia has secured a series of hard-fought wins in the federal Budget, including fuel security measures, tax concessions for farmers and new regional housing funding, but industry groups say the gains have been overshadowed by sweeping cuts to infrastructure, connectivity and regional services.
Response from various regional organisations is mixed, with small wins largely outweighed and undermined by bigger cuts and issues ignored.
Farmers listened to on tax, but not productivity
For all the talk of productivity, decisions such as the abandonment of Inland Rail indicate that the Government believes some types of productivity are more productive than others. The array of largely city- focused productivity measures will have no impact on the forecast productivity rate, which is unchanged at 1.2%.
NSW Farmers President Xavier Martin said the contradiction between the government’s productivity rhetoric and infrastructure decisions was impossible to ignore.
“Confidence about the year ahead has collapsed among farmers, with 80 per cent expecting business conditions to worsen over the next 12 months because of the war in Iran,” Mr Martin said.
“The people who grow the healthy plants and animals that literally feed and clothe our nation are ready to pull on their boots and get to work, but we need government to put in place policies and funding that unlocks that productivity.”
The National Farmers’ Federation said the Budget contained several important victories for agriculture, particularly the decision to exempt primary production income from the new 30 per cent discretionary trust tax.
“There are around 40,000 trusts used in agriculture so these are significant wins for family farm businesses and reflect the case we have consistently put to the Treasurer about how these changes would impacted succession,” NFF President Hamish McIntyre said.
“Family farms are generational businesses built over decades and often represent a family’s life savings and retirement plan. We are pleased the Government has listened.”
The government also permanently extended the instant asset write-off, introduced new loss carry-back provisions which are expected to be of value to farmers, and boosted funding for the Australian Pesticides and Veterinary Medicines Authority which may flow on to boost farm productivity.
But NFF said those measures were being undermined by cuts to regional infrastructure and connectivity, particularly the abandonment of Inland Rail north of Parkes, and the unexpected axing of the regional tech hub.
“There could not be a worse time to pull back investment in supply chains and regional connectivity,” Mr McIntyre said.
“The Inland Rail was designed to strengthen supply chains, ease pressure on our highways and reduce the cost of moving produce from farm gate to consumers.”
The Regional Tech Hub, run by NFF in partnership with the Australian Communications Consumer Action Network and funded by the federal government’s Better Connectivity Plan, was a dedicated service to help rural people, particularly those outside town, to figure out the best phone and internet set up for them. It was a particularly important service for many with the shutdown of the 3G network, and a very small line item. Funding for the program was not extended in this budget, with only funding to finish the NBN rollout and wi-fi in remote communities notable inclusions in regional communication.
“The Regional Tech Hub helped more than 75 regional people each day in 2025 alone,” Mr McIntyre said.
“Without continued support for this service, regional Australians may lose a trusted service that has helped thousands navigate major technology changes and stay connected.”
Budget papers raise more questions than answers
The federal government’s Regional Ministerial Budget Statement frames the Budget as a major investment in “prosperity, resilience and sustainability” for regional Australia, with a focus on fuel security, housing, health and services.
But much of the new spending and initiatives lauded in the statement is concentrated in social services, health and planning work – and is not specific to regional areas – while major freight and transport infrastructure projects have either been scaled back or delayed. A number of the stated initiatives in the regional statement, such as the Medicare Urgent Care Clinics, are extremely limited to larger regional centres, and are never intended to support most regional centres.
The Budget includes $659.6 million over three years to continue planning work on high speed rail between Newcastle and Sydney, alongside $1.8 billion for investment into the Australian Rail Track Corporation’s existing freight network, work which is understood to be largely focused on the coastal corridor.
At the same time, billions of dollars in Inland Rail investment have effectively been abandoned north of Parkes despite years of construction disruption and land acquisition across regional NSW and Queensland – and the Government will not explain how they came to the blow out figure of $45b used to justify its axing.
Asked directly by Member for New England Barnaby Joyce in parliament yesterday to name one line item that has contributed to the Inland Rail budget blow out, Infrastructure Minister Catherine King was unable to. The published summary of the ACIL Allen review of the project also provides no detail on how they arrived at the figure.
Fuel measures not enough
Last night’s budget included a $10.7 billion fuel security package designed to shore up domestic fuel and fertiliser supplies, announced last week. The package includes a $3.2 billion Australian Fuel Security Reserve, a $7.5 billion Fuel and Fertiliser Security Facility, and the temporary cut to fuel excise and the removal of the heavy vehicle road user charge for three months.
Mr Martin said the government’s decision to increase fuel reserves to 50 days was welcome, but still well below the 90-day target sought by industry.
“We strongly urge the government to commit to a clear pathway to the 90 days of stockpiles we have agreed to under the International Energy Agency framework, and ensure agriculture is explicitly prioritised if supplies run short,” he said.
The Australian Livestock and Rural Transporters Association also welcomed the fuel package, particularly the temporary suspension of the heavy vehicle road user charge, but warned the Budget failed to address deteriorating freight roads.
“Livestock and rural transport operators run on diesel. It is not a discretionary cost,” ALRTA National President Gerard Johnson said.
“Cutting the road user charge to zero goes straight to one of the largest operating costs our members carry.”
However, Mr Johnson said regional roads carrying livestock, grain, feed and fertiliser remained critically underfunded.
“Local roads are not minor roads when they are carrying livestock, grain, feed, fertiliser and farm supplies — they are part of the national freight network and need to be funded that way,” he said.
Got something you want to say about this story? Have your say on our opinion and comment hub, New England Times Engage