G20 Must Address Inequality - Costello

The growing gap between Australia’s richest and poorest people must be a priority for the world’s leaders at the upcoming G20 Conference in Brisbane, World Vision CEO and C20 Chair,Tim Costello said at a Not for Profit Forum today.

Costello told Pro Bono Australia News that Australia was experiencing a widening of the top and bottom classes.

“The world has seen a very big blowout in equality,” Costello said.

Representatives of Australia’s community sector are attending the ACOSS Forum in Melbourne today urging the Federal Government to work together with civil society and business groups on a national inclusive growth plan, as the G20 world leaders arrive in Australia at the weekend.

“In Australia since 1975 the top 10 per cent of people have seen their incomes increase by 59 per cent while the bottom 10 per cent of people have seen their income increase by just 14 per cent,” Costello said.

“If the bottom 10 per cent had seen their income increase at the same rate as the top 10 per cent, they would have received $14,000 more per year than they currently make.

“Our growth in inequality is not as great as in countries like the USA, but it is still very great.”

Costello told the ACOSS forum that the inequality in tax burdens also needed to be addressed.

“The most sacred part of the social contract is tax,” he said.

“When the biggest multinationals are avoiding their fair share of tax it is robbing the poor and mocking the efforts of people who are paying their tax.”

Costello said the C20 was looking for an outcome that clearly demonstrates G20 Leaders’ commitment to fairness by taking concrete, measurable action to reduce inequality and address climate change.

“It will be a sad legacy of the Australian Presidency if we go backwards in the fight against poverty by failing to tackle growing inequality,” Costello said.

“The G20’s Brisbane Action Plan must build on the formal commitment made in St Petersburg last year for inclusive growth to be a central focus of G20 decision making.  Otherwise meeting the two per cent growth target will be a hollow achievement and Leaders will be judged as indifferent to those most in need.

“More than half the world’s poor live in G20 countries and seven out 10 of all people live in countries where inequality has increased since the 1980s. There is a yawning divide between the richest and the poorest that is undermining the global fight against poverty, and eroding trust in governments.

“This is why the C20 is calling on the G20 to take action that will result in growth in the incomes of the bottom 20 percent of households, and for growth plans to be jobs-rich.

“The G20 will be rendered irrelevant if it cannot deliver outcomes that benefit those beyond an exclusive economic elite.

“That includes making our international tax system fairer by closing the loopholes that make it easier for corporations and wealthy individuals to dodge their tax obligations.

“The G20 needs to ask itself a simple question: Why do tax havens even exist?

“The C20 argues that climate change is a critical economic issue confronting the G20 and must be discussed as a stand-alone item of the G20 agenda.  The decision by the Australian Presidency to ignore the impact of climate change on the global economy is a retrograde and damaging step.

“This G20 will ultimately be judged by the fairness test whether that’s fairness to future generations by facing up to climate change; fairness to the bottom 20 per cent of poorest households; fairness to 75 million young people unemployed worldwide; or fairness to taxpayers by declaring tax havens immoral.”

“What we need is fair and inclusive growth, and measures that ensure that everyone in the community benefits in the long term,” ACOSS CEO Dr Cassandra Goldie said ahead of the Forum.

“Australia’s community sector and civil society will be applying the fairness test to any growth target reached by G20 leaders this weekend. We’ll be looking for an outcome that clearly demonstrates the Leaders’ commitment to fairness by taking concrete and measurable action to reduce inequality.

“We’ve got a situation now where 2.5 million people are living below the poverty in Australia, we cannot afford measures that take us backwards in the fight against poverty and growing inequality.

“Inclusive growth must be a central focus of G20 decision making and the agenda that leaders bring to it. Unless it is, meeting the two percent growth target will be a hollow achievement and Leaders will be rightly judged as indifferent to those most in need.”

The Australian C20 Steering Committee comprises representatives of international and domestic civil society organisations including World Vision Australia, ACOSS, WWF, Oxfam, Transparency International, the National Council of Churches, and the National Employment Services Association.  

The C20 has focused its engagement with the G20 around the four key areas of:

•          Inclusive Growth and Employment;
•          Infrastructure;
•          Climate and Resource Sustainability; and
•          Governance (including tax and financial transparency).

A copy of the C20’s Statement submitted to the G20 ahead of the G20 Leaders’ Summit in Brisbane can be found here.