The Federal Budget hits more than just your hip pocket. It hits ASX-listed companies, too. Here’s a wrap of the sectors set to win and those set to feel the squeeze on the market.
From critical minerals miners through to private health insurers, the 2026-27 Federal Budget looks set to reshape entire ASX sectors.
Beyond the headline tax reforms, the 2026-27 Federal Budget delivers multi-billion-dollar funding programs in defence, aged care, infrastructure and critical minerals, while extracting savings from private health insurance, the NDIS and excisable tobacco.
The winners
Defence contractors and naval shipbuilders
The 2026 National Defence Strategy and Integrated Investment Program provides $6.8 billion in additional funding over four years from 2026-27 and $35.6 billion over ten years. Total flagged investment increases by $14 billion over four years and $53 billion over the decade. I guess that’s what you get when the world is embroiled in ever-changing conflicts.
The AUKUS deal continues to pay dividends to the sector, with the an equity injection into Australian Naval Infrastructure to support the construction of the Nuclear-Powered Submarine Construction Yard in South Australia. Meanwhile, there’s a separate $106.4 million over six years extends Defence Industry support through grants and the Defence Industry Internship Program (BP2 page 78).
Critical minerals miners
The Critical Minerals Production Tax Incentive begins paying out from 2027-28, with payments forecast to grow significantly through to 2029-30. While it isn’t a new program announced in the budget, we’re now seeing the cash payment ramp inside the forward estimates period. The first production credits flowing to qualifying refiners in 2027-28.
The Government has framed the incentive as a long-run support for the domestic critical minerals processing capability that underpins the broader Future Made in Australia agenda.
Build-to-Rent developers and operators
Housing investors might have seen a bit more stick than carrot in the Budget, but it isn’t all bad news. Build-to-Rent (BTR) developments are explicitly carved out of the new negative gearing limitation.
Industry estimates cited in Budget Paper No. 1 (on page 21 if you’re looking for it) suggest the broader BTR settings will support around 80,000 new rental homes over the next decade, including up to 1200 affordable rentals.
Infrastructure builders and civil construction
Everyone’s watching the government’s purse-strings when it comes to big infrastructure and building projects this Budget. Regardless, the “Building a Better Future Through Considered Infrastructure Investment” measure commits $8.6 billion over 11 years from 2025-26.
The single biggest line item is $3.8 billion in additional funding for Suburban Rail Loop East in Victoria. Other major items include $1.8 billion in equity for the Australian Rail Track Corporation to invest in its interstate rail network (despite the recent dubious cancellation of the inland rail project).
There’s also $812.5 million for the Bruce Highway Stage 2 upgrade in Queensland, $552 million for Anketell Road in Western Australia, $76.4 million for Melton Line Electrification in Victoria, and $50 million for the Sydney-Canberra Rail Corridor Upgrade in New South Wales.
Private aged care operators
The ageing population in Australia got several callouts in Chalmers’ speech to the House on Budget night. Now we see it showing up in Budget papers too.
The “Better Care for Older Australians” measure commits $565.1 million over four years from 2026-27. The separate “Residential Aged Care Supply and Equity of Access” measure adds $606.5 million over four years plus a further $3 billion from 2030-31 to 2035-36.
The new mechanism is a capital subsidy paid to providers of $30 per supported resident per day for newly constructed homes (payable for up to 25 years) and $15 per day for significantly expanded homes (payable for up to 15 years).
The Government has been explicit that the savings extracted from the private health insurance rebate change are being redirected to this sector.
Primary care, bulk-billing networks and Medicare-exposed providers
The “Strengthening Medicare” measure provides $2.1 billion over five years from 2025-26, with $599.6 million per year. The biggest component is $1.8 billion to fund Medicare Urgent Care Clinics on an ongoing basis. Other components include $119.3 million extending the Practice Incentives Program Quality Improvement Incentive, $47.6 million increasing grants under the Radiation Oncology Health Program Grants Scheme to maintain access to affordable cancer treatment for concession card holders, and $25.3 million for up to six new fully bulk-billing GP clinics.
Pharmacy and pharmaceutical supply chain
There’s similar spending on pharmaceuticals here too. Pharmaceutical Benefits Scheme New and Amended Listings deliver $5.92 billion in spending over five years from 2025-26. The “Improving Access and Uptake of Medicines and Vaccines” measure adds a further $590.7 million over five years, with the largest single component being $449.3 million for the RSV vaccine Arexvy on the National Immunisation Program for over-75s and First Nations Australians from age 60.
The losers
Private health insurers
The “Modernising Private Health” measure delivers $3 billion in savings over four years from 2026-27 and $1 billion per year ongoing by removing the age-based uplift of the Private Health Insurance Rebate from 1 April 2027.
The age-based uplift currently delivers a higher rebate to older policyholders. Its removal simplifies the rebate but reduces the per-policy government contribution for the most rebate-rich customer cohort. The savings are explicitly redirected to aged care.
NDIS-exposed providers and contractors
Everyone was waiting to see how deep the NDIS cuts would go, and ASX-listed operators are probably going to feel this one. The “Securing the National Disability Insurance Scheme for Future Generations” line item is the single largest saving measure in this Budget.
NDIA payments fall by $1.133 billion in 2026-27, $7.253 billion in 2027-28, $11.748 billion in 2028-29, and $16.479 billion in 2029-30, totalling a cumulative reduction of $36.6 billion over four years.
The Treasurer’s media release indicates the projected 2030 NDIS cost path falls from $70 billion to $55 billion. Mandatory registration of high-risk NDIS providers is being introduced, and access assessments are being standardised.
Hydrogen producers
Hydrogen continues to be the Betamax/A-Track tape of the vehicle fuel world. Budget Paper 1 confirms a downgrade of $1.9 billion over five years to 2029-30 in projected payments under the Hydrogen Production Tax Incentive, “largely reflecting lower-than-expected production forecasts from the renewable hydrogen industry.” It isn’t a complete gutting, however. The program itself remains in place.
Treasury has effectively booked a smaller hydrogen subsidy pipeline because the projects expected to deliver volumes are not materialising on the timeline assumed when the program was designed.
Mixed signals
Petroleum and LNG producers
Higher fuel prices means higher tax contributions under the Petroleum Resource Rent Tax (PRRT). Receipts for this have been revised up by $400 million in 2026-27 and $1.6 billion over the five years from 2025-26 to 2029-30, with papers directly citing high petrol prices.
Rather than being a big new tax, however, this is a revenue forecast revision. Still, it’s an upgraded tax-take for listed producers worth mentioning.
Banks
Two signals point in different directions for the major banks.
The Major Bank Levy receipts have been revised up by around $40 to $50 million per year on a technical basis. What’s more significant is the second-order impact of the negative gearing changes.
Treasury’s own modelling indicates the reforms are expected to shift the housing market towards an additional 75,000 owner-occupiers over a decade. It’s set to be a shift in the housing mix towards owner-occupiers and away from investors implies a longer-run shift in mortgage book mix for the major lenders. It’s tricky to call because investor lending typically runs at higher margins for banks.
R&D-intensive listed companies
While the “better targeting” of the Research and Development Tax Incentive is a net cut of $1.6 billion to RDTI payments over three years, there’s a redistribution going on. Which seems popular this Budget, at least. There will now be $400 million per year specifically unlocked for young firms.
The redistribution favours early-stage and high-intensity R&D claimants over established large claimants. The specific impact at each company depends on the size of its claim relative to revenue and its R&D intensity ratio, both of which determine eligibility under the revised settings.
A note on what we’re still waiting on
Several detail-driven measures still require legislation or further consultation before the full operating shape is clear. As a result, we’ll need to make a call on who wins and who loses based on the horse-trading Chalmers and PM Albanese have to do to get these new Bills through a pretty hostile Senate.
This article does not take into account the investment objectives, financial situation or particular needs of any individual. It does not constitute formal advice. Readers should consult a licensed financial adviser before making investment decisions based on the information set out above. Stocks mentioned are referenced as representative of declared business exposure to the sectors discussed, not as recommendations.
