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Rich and Poor Gap Widens – Report


15 September 2015 at 12:47 pm
Ellie Cooper
The gap in living standards across Australia is growing and the outcome for those on the lowest incomes is set to decline, according to research released by Anglicare today at its national conference in Canberra.

Ellie Cooper | 15 September 2015 at 12:47 pm


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Rich and Poor Gap Widens – Report
15 September 2015 at 12:47 pm

The gap in living standards across Australia is growing and the outcome for those on the lowest incomes is set to decline, according to research released by Anglicare today at its national conference in Canberra.

The Living Standards Trends in Australia report from a leading economic modelling centre found that while living standards boomed over the past decade the growth was not shared evenly.

Households in the top 20 per cent of income experienced a 28.4 growth in living standards, but for the bottom 20 per cent there was only a growth of 15.1 per cent.

Anglicare Australia commissioned the report from NATSEM, the University of Canberra’s National Centre for Social and Economic Modelling.

“The top quintile of income earners has basically experienced double the growth of the lowest, so that’s not feasible in our view,” Anglicare Australia’s Executive Director, Kasy Chambers, told Pro Bono Australia News.

“But perhaps the most disturbing thing is, when we look towards the next 10 years the income growth is going to slow.”

Nevertheless, the top group of income earners are still projected to enjoy a further 5.9 per cent increase in growth over the next ten years.

Living standards will remain flat – at best – for those on middle and lower middle incomes.

However living standards for the lowest income group will fall 4.5 per cent.

“Why that’s particularly important and particularly concerning, is that when you’re already on the lowest of incomes you really don’t have far to drop before you’re in dire trouble,” Chambers said.

Households relying on a person who receives income from benefits such as Newstart or Youth Allowance can expect a significant fall of 10.3 per cent on average.

“Projections over the next 10 years suggest that allowee and single parent pension families will experience a serious reduction in living standards,” the report said.

“This lowering in living standards is caused by a range of factors but the main drivers are relatively lower payments due to changes in the most recent two Federal Budgets.”

Chambers said Anglicare Australia is hopeful that now Malcolm Turnbull is leading the Liberal party there will be changes to welfare policy.

“The combination of economic change and the public policies of Australian governments over the past ten years appear to be leaving certain groups of people further and further behind,” she said.

“We are however more optimistic that this different Government will seek to bring more people along, may not  have the same idealism about families who don’t have work currently or sole parents.

“So we are optimistic but we still need to see changes to policy.”  

Chambers said the equality gap must be addressed now before Australia’s poorest are “left behind”.

“As Leonard Cohen sings, ‘everybody knows the fight is fixed, the poor stay poor and the rich get rich.’ That is true of the past 10 years of vigorous growth. What this report tells us, however, is that the poor will not just stay poor. They are on track to get poorer,” she said.

“Australia has reached a watershed. We can continue to walk away from many of the most vulnerable and the most disadvantaged among us, as this research shows we are doing. Or we can commit now to ensuring our economy and our society gives everyone a fair go.”


Ellie Cooper  |  Journalist  |  @ProBonoNews

Ellie Cooper is a journalist covering the social sector.

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