6 ways good climate policy helps your wallet and your health
Good economic and health policies depend on good climate policy, and the earlier we implement them, the better for our future
Published 2 May 2025
As climate and health researchers, we find it hard not to notice the lack of debate around climate change in this federal election.
Both major parties have chosen not to announce their 2035 Paris Agreement targets ahead of the polls.
Federal Treasurer Jim Chalmers’ recent 2025–26 budget speech did not use the words ‘climate change’ once. He did, however, announce a funding reduction of $AU2.4 million to the Department of Environment and Climate Change.
There may be method to the madness. Cost of living pressures, which continued to increase throughout 2024, are front of mind for many voters.
With economic spending under constant scrutiny, it has never been more important to demonstrate the benefits of government spending on policies and programs.
The current Minister for Health and Aged Care, Mark Butler, has historically argued that good climate policy is good health policy.
We agree, and research demonstrates that good climate policy also reaps strong economic returns by safeguarding against future government spending on health.
The economic costs associated with health and climate change can relate to direct impacts like injury or death, but also extend to secondary impacts, like reduced labour productivity.
Research from the University of Melbourne’s Climate CATCH lab consistently shows the cost of inaction far outweighs the cost of investment in urgent action.
In fact, it has been demonstrated that spending on climate action leads to net economic benefits, both in Australia and internationally.
At the time of writing, with the Australian Government in caretaker mode, it is difficult to determine which climate policies will be pursued after the election.
What is clear, however, is that there are opportunities to more clearly communicate the links between climate, health and the economy to both politicians and the public.
In a recent policy brief, we’ve set out six steps that aim to shore up health, climate and economic resilience in Australia.
1. Invest adequate resources
Investing in climate policy now will save our economy billions of dollars in the future.
In Victoria, if 2035 climate targets are achieved, the health benefits alone are estimated to be worth $AU23 billion by 2050.
As an example, we've estimated that the economic impact of childhood asthma attributable to air pollution from idling vehicles in Australia in 2022 was $AU12.28 million. Implementing an anti-idling campaign at $AU2.77 million clearly shows the economic savings of preventive policies.
However, funding to date is insufficient to address critical data gaps and evidence needed to support decision-making processes.
Adequately resourcing health and climate action, including additional dedicated funding for solutions-oriented climate and health research, set us up for a stronger economic future.
Sciences & Technology
Extreme weather is Australia's new normal
2. Protect future generations
The impacts of climate change on child mental health and wellbeing are enormous and there is a critical gap in trauma-informed services for vulnerable groups.
We should follow models like the one in Wales, by implementing a Future Generations Commission and developing an early years' strategy that incorporates a disaster mental health perspective for infants, children and their caregivers.
This will shore up our future labour force and our future economy.
3. Decarbonise the healthcare sector
The healthcare sector, which accounts for around seven per cent of Australia’s emissions, has an opportunity and a responsibility to rapidly reduce its emissions.
Opportunities exist to reap health and economic rewards from investments in sustainable practices. Efforts both in Australia and abroad have shown that direct climate action in healthcare is beneficial for health and the economy.
The rapidly expanding University of Melbourne-led Health Service Sustainability Competition has already demonstrated climate, health and economic benefits, including savings of $AU800,000 and the diversion of three tonnes of waste from landfill over the first two years.
4. Get ahead of climate disasters
Australians are already experiencing physical and mental health impacts from extreme weather events.
Investing in disaster preparedness early will save huge amounts in the future, with a recent report by the US Chamber of Commerce concluding that, for every US dollar invested in disaster preparedness, $US13 was saved in economic costs, damages and clean up.
Rather than focus on response and recovery, a national adaptation plan would help us to prioritise preventing impacts for stronger and more resilient communities.
5. Be better neighbours
Australia’s resilience to climate change is shaped by the climate resilience of our regional neighbours.
A number of programs, like the World Health Organization’s Asia-Pacific Centre for Environment and Health in the Western Pacific Region, are already doing incredible work to prevent and adapt to the impacts of climate change.
Increasing aid to our neighbours across the Indo-Pacific to 0.7 per cent of our gross national income (official development assistance was 0.19 per cent of GNI in 2024) will build climate resilience among the most at-risk populations and prevent the cost of climate impacts from reaching our shores.
6. Get creative
The arts sector plays a vital role in engaging Australians from diverse walks of life and improving climate and health literacy through thought-provoking conversations, while increasing social licence and addressing mental health impacts.
Projects like our Sonic Youth music project for young Victorians in climate-affected areas allow Australians to reap the health and other benefits of embedding climate change in creative processes.
If we continue to delay debate on ambitious climate action in this country, we are at risk of working within a policy context that does not acknowledge and prioritise the fundamental link between climate change and the cost of living – and to our economy more broadly.
These actions are sensible investment opportunities that bring climate, health and economic benefits, in addition to supporting disaster preparedness.
Asking our political candidates to commit to these steps now will ensure a stronger economic future in which Australians can thrive.