Another Coalition budget for the well-off

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In recent months, the Prime Minister and the Treasurer have been at pains to stress that their vision for Australia's future would be outlined in the Federal Budget. What was revealed on Budget night was that the vision they hold is all too narrow, and those most in need are hidden from view.

One scruffy foot, one neat and polished footVulnerable Australians have again been overlooked in this third Federal Budget from the Coalition Government.

With a focus on supporting business and those who already enjoy financial and social security, the Government has preferred to put money in the hands of businesses and the affluent rather than low income Australians.

The 2016-17 Budget provides tax cuts to the rich and service cuts to the rest.

This Budget has given tax relief to those earning over $80K. This measure will cost $4 billion, which could have been spent on investment in families and communities.

The Government still clings to the old rhetoric, evident in their Budget priorities, that the 'trickle down' approach of stimulating business and giving tax relief to those on higher incomes will generate more jobs and therefore greater resources for those whose means are modest. It's a noble theory, without any evidence whatsoever to suggest that it reflects reality.

Even the International Monetary Fund recognises that the best way to grow an economy is to reduce the divide between rich and poor, ensuring that all people have a chance to participate in the social and economic life of a country. The Coalition government remains resolutely opposed to this growing body of evidence, continuing to rely on economic structures that do nothing but entrench disadvantage and then blame the poor for their fate.

Social service agencies know what works to arrest disadvantage and overcome poverty. Those living on the fringes of our communities would welcome the opportunity to be a focus of investment.

 

"For the third year running, this government offers nothing to those who are homeless or experiencing significant housing and rental stress."

 

Government and business, working in partnership with social service providers in innovative relationships, could change the outcomes in life for the young people, families, people with disability and mental health challenges who are desperately looking for an opportunity to participate in the social and economic prosperity that all Australians desire.

For the third year running, this government offers nothing to those who are homeless or experiencing significant housing and rental stress.

Securing the basics in life — a house, an education, and health care — is increasingly beyond the means of average Australians, and impossible for those on low incomes. The successive failure of this government to address Australia's housing crisis, rental affordability and rising homelessness is a disgrace. A long-term strategy which includes binding agreements between the Commonwealth, states and territories is needed to stimulate housing construction and ensure greater affordability.

The compulsory rent deduction for public housing tenants outlined in the Budget is troubling. Public housing tenants actually have a high degree of compliance in meeting their rental obligations. This unnecessary restriction on people managing their own incomes, which strips people of the capacity to manage their budget in order to best balance their costs of food, utilities and health care, means that people who are already vulnerable are subject to greater disadvantage.

While the reworking of the 'work for the dole' scheme (Youth Jobs PaTH — Prepare, Trial, Hire) as an initiative to help some 100,000 people under 25 to secure jobs is a welcome attempt to get vulnerable young people into employment, the focus on making payments to employers of $10,000 after only six months' engagement is misguided. It may result in young people, already a highly vulnerable workforce cohort, being terminated at the end of the six month period, resulting in workforce churn.

Payments of $10,000 to employers effectively create a cut-price labour force that is open to exploitation by disreputable employers.

In delivering his Budget speech, Scott Morrison said that 'wherever possible we prefer to leave a dollar in Australians' pockets than take it for the government's pocket, because we know that it is money in your pocket that can help you and your family most'.

By the Treasurer's own measure, this Budget fails to support those Australian families most in need of that help. Australia has an estimated 600,000 children living in poverty and this Budget offers them little hope. If the government invested in these children's families directly they could have secured the future of the children and stimulated the economy.

 

"This Budget will further increase inequality in Australia. Tax cuts for the rich while people on Newstart and other welfare payments are asked to live on inadequate income will ensure that vulnerable members of our community continue to get left behind."

 

Of concern is the government's focus on some 90,000 recipients of the Disability Support Pension who will be subject to review via a Disability Medical Assessment as part of what is described as an 'overall review process for those considered to be a high risk of not being eligible for the payment'. The government does not expand on how it has arrived at a figure of 90,000 DSP recipients as being likely to be ineligible for support.

The allocation of $10.9 million over three years to provide additional support for recently arrived humanitarian migrants, to strengthen their sense of belonging to the community and strengthen their participation, is welcome.

So too is the commitment of government to work with the sector in developing innovative practice to support individuals moving from welfare to independence through its Try, Test and Learn Fund. The $96.1 million announced will go some way to recognising the innovation and creativity of social service agencies in delivering efficient and effective services to support individuals and families.

An additional $100 million channelled into domestic and family violence initiatives, building on the $101.2 million provided through the Women's Safety Package announced at 2015-16 MYEFO, is also a welcome recognition that much more resources need to be allocated to addressing violence in the home.

The additional $7.1 million in the coming financial year to support financial counselling for problem gamblers is a very positive step, and hopefully such measures continue into the future. Problem gambling devastates many families across Australia, and continued support is needed over the long term to assist people to rebuild their lives.

The Dropping off the Edge 2015 report found people in Australia's most disadvantaged communities are locked out of economic and social opportunities. The report also highlighted that residents in these communities are not just dealing with one form of disadvantage but multiple, complex barriers to individual wellbeing and community participation. This Budget has missed the opportunity to address the failures of the previous budgets, for the poorest and most vulnerable in our society.

This Budget will further increase inequality in Australia. Tax cuts for the rich while people on Newstart and other welfare payments are asked to live on inadequate income will only serve to ensure that vulnerable members of our community continue to get left behind.

With this Budget now released, and a Federal Election imminent, we need political leaders from all parties to commit to building a future for all people, so that the common-wealth of this country may be shared to benefit all Australians, especially the most vulnerable.

 


Marcelle MoggMarcelle Mogg is CEO of Catholic Social Services Australia.

Main image: Shutterstock 

 

Topic tags: Marcelle Mogg, Budget, Scott Morrison


 

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I agree with Australian Greens President, Richard De Natale, who says: “Malcolm Turnbull has embarked on a series of unfair and unsustainable tax cuts for big business and high-income earners. This budget makes fanciful claims about future growth to justify tax cuts that come at the expense of our schools, dental, health services and higher education. The Greens will stand up to any budget that ignores global warming and puts big business ahead of people and our planet. … This government is choosing to ignore global warming. They’re choosing to hand tax breaks to the highest income earners and they’re choosing to throw millions at the inhumane prison camps being used to punish refugees. The government doesn’t see a future in clean energy. They see it in military hardware. A better budget is one that reduces inequality and invests in Australia’s future. That means prioritising clean energy jobs and infrastructure, and properly funding our public schools and hospitals. ... The Greens have a vision for a better budget for Australians – one that puts people first. It means raising revenue by ending unfair tax discounts for big businesses, the very wealthy, and fossil fuel giants.”
Grant Allen | 04 May 2016


Just in case people missed it, this budget again cuts foreign aid. Yes, after Tony abbott's massive cut to foreign aid, Malcolm Turnbull has also decided to shame Australia with this inexcusable meanness. Remember this when next you hear a politician boast that Australia hasn't suffered a recession over the past 23 years.
Russell | 04 May 2016


"The Greens have a policy that . . . puts people first." That's about as off-key as it gets,Grant.The Greens, in fact, espouse an anti-humanist ideology and policies that do the most vulnerable in our society out of participation in life itself and workers out of jobs - to the dopey lyrics of John Lennon's "Imagine."
John | 05 May 2016


With their new slogan claiming that the ALP is "against aspiration, against ambition, against enterprise" the government appears to be attempting to resurrect the "undeserving poor".
Lee Boldeman | 05 May 2016


Whilst I certainly agree with some comments, I respectfully suggest that Marcelle Hogg should become an MP in the Government Party to effectively address her concerns. Remember Bob Hawke already promised that no child should live below the poverty line and did not deliver. Action not words are necessary! The same applies to commentator Grant Allen who advocates greater efforts in climate change areas.
Peter | 05 May 2016


Best comment on the Budget I have seen. Every Coalition voter should read this article - every voter come to that. Thanks, Marcelle.
tony | 05 May 2016


I am constantly reminded how opinions in Eureka Street demonstrate strong Left Wing view. How do Unions help the poor when they demand massive wage rises which tax payers have to fund? I am a self funded retiree with a very modest Superannuation. I donate to St V de P and other worthy causes and needy people. I am not anti poor, nor do I blame people for being poor. You are continuing to widen the rift of "rich vs poor". Be a voice for the poor but don't blame those who are able to provide for themselves. This budget gave me nothing either but I still give thanks for living in the best country in the world. I have been a missionary in PNG. I know first hand how lucky we in Australia are..... Even our poor are rich by comparison with places like PNG and East Timor. Try to be balanced in your writing. Turnbull is not a saviour, but Shorten would destroy our standards and economy. Your political flavour and criticism of the current government is unacceptable in my view. But then, you are reflecting the be general flavour of Eureks Street, sadly.
Marie Hardwick | 05 May 2016


Dear Marie Hardwick. Long live Eureka Street.
brian finlayson | 05 May 2016


Very insightful, Marcelle. Yet again the government’s preferential option for the wealthy is clearly in evidence.
Brian Grenier | 05 May 2016


Hi Marie, I also hope ES continues to challenge authority, put up alternative views and encourage debate. I don't agree with every article but that's life. In many ways ES is a counterpoint to much of the "popular" media. I can see some conservatives might view ES as having left wing bias for holding the mirror to a right wing government, but ES did much the same to the Labor Governments. Funny how the critics now did not come out about "bias" back then. You give yourself away a little when you say "Shorten would destroy our standards and economy", which I don't believe is true. Surely that is a bit of "right wing" scare-mongering. Having said all that, I fully support your right to express your opinion and thank ES for giving us all a soap box for our views.
Brett | 05 May 2016


This article admits that the budget has provided for at least five welcome changes advantaging those who most need help. No mention of the removal of tax evasion systems from the genuinely wealthy or the curtailment of their superannuation advantages. No recognition that in this country $80k is an income that applies to most tradesmen and to most families with both mother and father working. Do they not deserve the very modest tax relief the budget offers? No recognition of the great advantages to the health care of the poor and chronically ill with $2.9 billion to the public hospital system on which they are dependent. No understanding of the reduction in bulk billing (accessible by all, including the resoundingly wealthy) which is responsible for wastage of funds that should go to the public system. No mention on the 4 year freeze on Medicare payments to the wealthy, conservative doctors which will save millions in favour of the public system i.e. the "poor and disadvantaged".. No mention of the $60m in therapeutic medicine subsidies, accessed in the main by the elderly and those not in the workforce. Does not the government already contribute funds to the 600,000 children living in poverty through payments to their parents both in child allowances and pensions of various denominations and to welfare agencies using much of the funds to pay their staff? Has it not been adequately demonstrated over years that a number of recipients of disability payments wrought the system? Is it a crime to eliminate this in the budget? The astounding criticism of the re-worked work for dole system for no reason other than a measly payment of $10,000 to the employer, that sinister destroyer of the socialist Utopia, who carries some cost for the first six months while training the recipient with a view to future independence. No recognition that this budget has left Abbott and Hockey despatched to the oblivion they deserved with their "class wars" approach. As Morrison said this morning it is time the class wars were left in the past. What tunnel vision could possibly have failed to see so much good compared with budgets of both major parties over many decades. Where on Earth could today's title piece have come from? Certainly not from the major implications of this budget.
john frawley | 05 May 2016


Thank you for speaking up for the poor, Marcelle, and for all those living on the lowest incomes in Australia. Thanks also, Russell, for your reminder that our overseas aid budget is now at its lowest level ever. Australia is one of the wealthiest nations in the world, but we're refusing to share our wealth more evenly with those in deep need. I find this repulsive.
robert van zetten | 05 May 2016


This government won't provide leadership on these social justice issues, so it is up to us, the people, to provide that leadership and ensure that our voices are heard. Research is now showing we don't mind paying more tax if the money raised is spent on health, education, and supporting those in need. Give my 1% company tax rebate to those who will spend and stimulate the economy. A tax cut will not drive investment by small business. Only confidence and more opportunities will do that. We want a fairer society. It is in OUR best interests.
Riborg Andersen | 05 May 2016


Marie, I have never seen anything in Eureka Street that is as left-wing as the command from the Tradie from Nazareth who told us that if we have two shirts we must give one to a person who has none.
Peter Downie | 05 May 2016


“Those living on the fringes of our communities would welcome the opportunity to be a focus of investment.” It’s been tried. In the USA, Lyndon Johnson’s Great Society set out to do just that—to eliminate poverty, spent US$22 trillion, and succeeded only in creating a permanent underclass. Same thing in 1970s Australia, and we now have a third generation of families living on welfare. A 2008 report into youth homelessness largely blamed no-fault divorce and single parenting, but because few wanted to reverse those social changes the only solution was more government billions. Australia now has more people who vote for their money than who work for it, and is paying $1 billion per month interest on Rudd/Gillard debt. A socialist nirvana was hailed for Venezuela under the “Christian” socialism of Hugo Chavez. The country is now bankrupt with 720 per cent inflation, but blaming everyone but themselves. John Joseph Hughes turned a poverty-ridden community of criminals, alcoholics and prostitutes into the nation’s finest citizens in one generation without government help. How? He instilled into them Christian virtues which enabled the people to pull themselves up by their own bootstraps. [http://www.catholiceducation.org/en/faith-and-character/faith-and-character/how-dagger-john-saved-new-york-s-irish.html]
Ross Howard | 05 May 2016


Oh dear; this conversation is just so wingeing Australian. The poorer 50% of Aussies pay no net tax; now that is unbelievable. The government is spending money it does not have and we are living as a country beyond our means. We will have to spend less, not more on social services , health and education, either voluntarily or once the bailiffs arrive. Why cannot our special interest lobby groups focus on suggesting ways to spend the huge amounts of money they already get better, rather than always asking for more? The game is up chaps.
Eugene | 05 May 2016


One of the problems as highlighted by a question on QandA last night is that "the poor" (sorry about using that term) do pay tax. Perhaps less in dollar terms than the "better off" and the "super rich" who can afford accountants to minimise their taxable income but much more as a proportion of disposable income. The problem is compounded with efforts to replace income tax with higher regressive tax rates like the GST. Hasn't happened yet but they keep trying. This is pretty basic stuff. Maybe the "class wars" are being maintained under an economic rationalist banner.
Brett | 10 May 2016


'Why cannot our special interest lobby groups focus on suggesting ways to spend the huge amounts of money they already get better, rather than always asking for more?' Perhaps one way of spending the education dollar better would be to cease funding elite private schools, Eugene. I could never understand why Turnbull wanted the states to take over the funding of state schools while the feds would still fund private schools. If funding school education is to become a state responsibility, what business has the Commonwealth in funding school education in private schools? Another case of budgeting for th well off?
Ginger Meggs | 11 May 2016


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