Federal Budget summary
Following last night’s Federal Budget, we wanted to share a short update with members on the key measures affecting the bus and coach industry. This includes both the items signaled ahead of the Federal Budget, new announcements and what was noticeably missing.
A word from our CEO Varenya Mohan-Ram
“Whilst there are things to celebrate in the budget the $10.3 billion transport infrastructure package has largely forgotten the bus industry. Given that we are the most cost effective form of public transport for the tax payer money spent in this industry has a greater return on investment in our community.”
What we knew about
Measures below were announced and in effect prior to last night’s Budget as part of the Government’s emergency response to the Middle East fuel crisis.
Heavy Vehicle Road User Charge, temporarily reduced to zero
The heavy vehicle road user charge (previously 32.4 cents per litre of diesel) has been reduced to zero for three months from 1 April 2026. This is a direct and immediate cost relief measure for bus and coach operators. It is currently due to expire on 30 June 2026.
Fuel Excise Cut
The fuel excise has been cut by approximately 26.3 cents per litre for the same three-month period. Combined with the road user charge reduction, this represents a significant short-term saving for diesel-dependent operators, particularly regional and school bus services with high fuel consumption. This also expires 30 June 2026.
$1 Billion Interest-Free Loans, Economic Resilience Program
The National Reconstruction Fund’s Economic Resilience Program is providing $1 billion in interest-free loans to manufacturing and logistics businesses facing cashflow pressure from fuel costs or supply chain disruption. Bus and coach operators and manufacturers may be eligible. Applications are open through participating banks for loans up to $5 million, and directly through the NRFC for loans over $5 million. The bank-administered program is open for six months from 20 April 2026.
More information + NRFC website.
Fair Work Commission, Fuel Terms in Road Transport Contracts, Contractual Chian orders
The Government empowered the Fair Work Commission to make orders requiring more timely adjustments to fuel terms in road transport contracts. This has been in development for some time and gives small operators a formal mechanism to seek relief when fixed-price contracts do not adequately account for fuel price spikes.
New announcements in the Federal Budget
Heavy Vehicle Reforms, Zero Emissions and Productivity
The Government will accelerate heavy vehicle reforms through the National Competition Policy process, with the explicit aim of increasing productivity and supporting the uptake of zero emissions heavy vehicles. This is significant for BIC. The NCP framework will be used to push for national harmonisation of heavy vehicle regulation, something we have been calling for in the context of the ZEB transition. The detail of which specific reforms will be pursued is yet to be determined through consultation, so this is an important process for BIC to engage with.
ACCC Powers Streamlining
The Government will legislate to streamline the ACCC’s ability to authorise industry coordination during exceptional circumstances, such as future fuel supply emergencies. The current authorisation process proved too slow during the Middle East crisis. The change will allow operators to coordinate more quickly during a crisis without risking competition law breaches.
Apprenticeships, Building Australia’s Future
Continued investment in apprenticeship support is confirmed in the Budget, though specific funding figures are not publicly disclosed. This is relevant to our bus mechanic, bodybuilder and auto electrician pipeline and we should be ensuring member employers are aware of and accessing available apprenticeship incentives.
National Occupational Licensing Reform
The Government will work with states to progress national occupational licensing, initially focused on health workers but carrying clear relevance to our industry. Driver licensing inconsistencies across state borders contribute to workforce shortages and this is a reform process BIC could be seeking to be part of.
Skills Recognition for Migrant Workers, $85.2 Million
Funding has been confirmed to accelerate skills assessments and occupational licensing for overseas-trained workers. Given the acute driver shortage across the industry, faster pathways for overseas-trained bus drivers is directly relevant. It might be worth BIC engaging with the Department of Employment and Workplace Relations on how this applies to passenger transport occupations.
$1.1 Billion Cleaner Fuels Program
Production support for domestic low carbon liquid fuels including hydrogen. Relevant to the longer-term ZEB transition for regional and intercity coach services where battery electric is not yet viable for longer routes. BIC should be tracking how this funding is directed.
$500 Million Active Transport Fund
New money confirmed for the Active Transport Fund over ten years. While historically focused on walking and cycling, the program is potentially broad enough to cover bus priority infrastructure. Worth BIC seeking clarity from the Department on eligibility.
Notable budget absences
It is worth noting what was not in the Budget.
There is no dedicated zero emissions bus fund or bus depot charging infrastructure support, despite the Government funding EV charging for light vehicles and Australia Post’s fleet.
There is no extension of the fuel excise cut or heavy vehicle road user charge reduction beyond 30 June 2026. Members will face an immediate fuel cost increase when these measures expire on 30 June 2026.
There is no bus-specific allocation within the $10.3 billion transport infrastructure package.
The $10.3 billion transport infrastructure package is funding the following projects;
Regional/Suburban Programs: $750 million for new rounds of the Thriving Suburbs and Growing Regions programs
National Freight Rail: $1.75 billion to improve the productivity, resilience, and reliability of the freight rail network.
Suburban Rail Loop East (VIC): $3.8 billion for the project, bringing the total federal commitment to $6 billion.
Bruce Highway Upgrade (QLD): $812.5 million for Stage 2 of the Gateway Motorway to Dohles Rocks Road project.
Anketell Road Upgrades (WA): $552 million for the first stages to strengthen supply chains.
Active Transport: $500 million added to the Active Transport Fund to improve local walking and cycling options.
ENDS
