The education sector has welcomed aspects of the 2026–27 Federal Budget aimed at easing cost-of-living pressures for teachers and other workers, while warning that cuts to disability funding could place further strain on already stretched public schools.
The budget, unveiled on Tuesday 12 May 2026, also included an $18.2 million investment over four years for the National Assessment Program – Literacy and Numeracy (NAPLAN) online platform, with the federal government saying the funding would ensure the “operational integrity” of NAPLAN and other national assessments into the future.
Other education measures announced included $113 million to support First Nations students, $5.9 million to extend STEM initiatives, and funding to progress work on a proposed new Teaching and Learning Commission.
The Australian Education Union (AEU) Federal President Ms Correna Haythorpe said the union welcomed the government’s housing and tax reforms, particularly measures designed to improve housing affordability for working Australians.
“We have members across Australia who cannot afford to live in the communities they teach in,” she said. “Many are locked out of house ownership and impacted by rising rents, which impacts on the retention of staff and contributes to workforce shortages.”
The government announced a new $250 Working Australians Tax Offset from 2027–28, alongside changes to negative gearing arrangements that will limit concessions to new builds from July 2027. Policymakers hope tax system reforms will help more Australians “realise the dream of home ownership”.
Ms Haythorpe said the measures would help teachers, principals and education support staff facing mounting living costs.
“Tonight’s tax measures will help make housing fairer and more affordable for teachers, principals and education support staff who deserve to live in the communities in which they serve,” she said.
Disability support cuts
Despite welcoming the tax measures, the union expressed concern over what it described as cuts to disability support, including $472 million in savings linked to disability funding in schools.
“There are more than 200,000 students in the public school system who have been assessed as having a disability, yet receive no disability loadings,” Ms Haythorpe said.
“At the same time, we have seen disability funding to private schools grow by $1.4 billion from 2020 to 2024.”
The AEU said public schools were increasingly being forced to redirect existing resources to support students with disability due to unmet funding needs.
“A recent AEU survey of public school principals found they were re-allocating $147,000 per school to support students with disability from other areas of the school budget because of unmet need,” Ms Haythorpe said.
“Public schools educate the overwhelming majority of students with disability, yet too many schools are being forced to stretch already limited budgets to meet growing need.”
The union said it would seek further detail from the government on how the disability funding savings would affect schools and student support services.
Beyond schools, the budget also included $17.6 million to expand the National Early Childhood Worker Register and $1.7 million to extend the Life Education Australia program, including the long-running Healthy Harold initiative.
