A Budget For Middle Australia

This budget has put the individual ahead of community, and in doing so has shown this government’s ideology, writes Anglicare Australia executive director Kasy Chambers.

It’s been said that the party that wins over middle Australia will win the election. Tuesday’s budget was without doubt an election budget aimed wooing middle Australia.

The big ticket items for the big end of town were there, but the shiny new things were aimed fairly and squarely at middle Australians.

The bright spots in this year’s budget are for older people. Over 100,000 older people are waiting for high support home care packages. These packages make a difference in helping people to stay in their own homes longer. With 14,000 new ones announced last night, nearly one in five of those waiting will be a step closer. And the release of a similar number of new residential aged care places is also good to see.

The package seems well-rounded with money to support capital expenditure, support to deliver services in remote Aboriginal communities, and assistance to apply for services through a very expensive ($61.7 million) new website with easier to use forms.

The NDIS was another winner, and we were assured that funding that is “in place and always will be”. The budget documents report that it is on track to be fully rolled out from 2020. There is also a $92 million “continuity fund” for services to people who aren’t eligible from the NDIS, but who are receiving support from services that are transitioning to the NDIS. Under these continuity arrangements, those who are eligible will continue to receive the same level of support they currently receive. The trick now is to ensure that the scheme continues to enjoy bipartisan support into the future.

An Implementation Taskforce for the Royal Commission into Institutional Responses into Child Sexual Abuse was monetarily small, but still an important and positive measure. This will help ensure that the findings of the commission are given life and that this can never happen again.

The much touted women’s economic security plan was nothing more than a disappointing showbag of measures that had been re-badged. Aged care packages and jobs with the NDIS were amongst them, along with health measures for pregnancy and early childhood. Things that could really have made a difference like gender pay measures, support to build superannuation, and better retirement incomes were missing in action.

The dining and wining of middle Australia came in the tax cuts. A seven year plan to restructure personal income tax will see the establishment of a huge bracket of people all paying the same tax rate. Whether you earn $40,001 or whether you are paid $199,999, you will pay the same rate of tax. As a prominent budget-watcher and economist has observed, the tax cuts for low-income earners making less than $37,000 add up to just $3.85 per week – less than the cost of a milkshake. Those on $200,000 or more will get $137.60 per week. That’s about enough to pay the loan on a medium-sized sedan.

The long-term vision of this budget is in the tax cuts – a seven year plan. There is no seven year plan for a healthier Australia, a more inclusive Australia, a more environmentally-friendly Australia. And of course, there is a missed opportunity to join the chorus of community, business, civil society organisations and individuals calling for increases to benefits and pensions especially Newstart. I can’t remember a chorus of voices as united as this one. And like a choir, the call has been swelling over recent weeks to a crescendo carolling the paucity of Newstart.

At very least the budget could have established an independent commission to consider and set the level of benefits. Clearly there is a difference in perception between the public in its widest sense and the government. A commission would be well-placed to set levels and take into account the incentive to seek work, as well as the need to have a decent standard of living whilst that occurs.

Not only was there no increase to benefits, but we are continuing to see measures target people in need. Stopping dole payments to those that have a court-set fine, or a warrant for indictable offences, won’t help people who find themselves in that situation. And by not helping them, it won’t help the rest of us either. Unless we’ve become so mean spirited that we actually enjoy kicking people when they are down, and feeling smug that welfare payments are being stopped to people whose lives may have not had the head start many of us enjoyed.

Other measures will extend the waiting period for migrants to four years. There is also a cynical saving measure to move people off the higher Disability Support Pension and onto Newstart if they are imprisoned for longer than 13 weeks. And sadly, our stronger budget position has not led to the removal of the so-called zombie measures, like raising the pension age to 70. This new pension age may suit a population of ageing office workers, but it is harder on manual workers, the caring professions, and those with a more precarious hold on the workforce. It will move many of these people from the aged pension to Newstart.

The big winner was the ideology of the individual. Yes, in the first instance there will be tax cuts for those on lower incomes. But they are nowhere near enough to meet the rising cost of living. Our own Rental Affordability Snapshot, released the week before the budget, found increasingly high levels of unaffordability with less than 3 per cent of private rentals being affordable for a single person working full-time on the minimum wage.

This budget has put the individual ahead of community, showing this government’s ideology. Seven years of tax cuts and changes is not something that can be unwound easily. We must hope that the revenue that allows it will continue to come into the coffers.

What remains to be seen is whether the mood of middle Australia has been read correctly. And judging by what has been labelled an election budget, we won’t have to wait long before we find out.

About the author: Kasy Chambers is executive director of Anglicare Australia. Anglicare Australia is a network of 40 agencies, more than 20,000 staff and volunteers, working with over 900,000 clients annually across Australia.

Our 2018 budget coverage is brought to you by Community Sector Banking.