Andrew Leigh

Today, The Mercury published my opinion piece on the Federal Budget:

James Kelly of Berriedale has been unemployed for more than four years since graduating from Year 12. He’s been actively looking for work in retail. “I didn’t expect it would be this hard to get a job. It’s a bit demoralising ... I’d much rather not be on benefits but unfortunately I don’t have too many other options.”

James has a Certificate II in retail. But as most Tasmanians know, it’s tough if you’re young and unemployed across the state.

In Prime Minister Tony Abbott’s first Federal Budget, people like James will be hit even harder. In effect, they will be punished just because life’s dice has rolled against them.  

 

Withholding income support for six months to anyone under 30 out of work might save some money in the short term, but it will not get people into paid work any quicker. It will simply make their life harder in the meantime.

The Abbott Government’s first Budget isn’t an improvement in the nation’s public finances. If we compare this budget with the state of the books when the Government took office, it’s clear that the deficit is higher this year, next year, and over the forward estimates.

Hard to believe, isn’t it? But once you cut through all the chest-beating about ‘‘debt and deficits’’, you see a Budget that loses billions of dollars of revenue by abolishing the carbon price and the mining tax, while putting in place a new entitlement scheme for affluent new parents.

In effect, what this Budget represents is a shift in the burden from the poor to the rich: Robin Hood in reverse. According to new modelling by the National Centre for Social and Economic Modelling (NATSEM), the top fifth of families will see a 0.3 per cent reduction in their incomes, while the bottom fifth will see a 5 per cent reduction in their incomes.

Taking from the have-nots to give to the haves would be unconscionable at the best of times, but it’s particularly Budget is Robin Hood in reverse egregious after a generation of rising inequality. In Australia today, the top three people have more wealth than the bottom million people, and yet this is a Budget that will take from the bottom to give to the top. And then there’s the issue of promises. Before the election, Mr Abbott promised “no cuts to education, no cuts to health, no change to pensions, no change to the GST”.

Now he’s cutting education, cutting health, cutting pensions, and putting pressure on states to raise the GST. Asked at the weekend about this, Mr Abbott blamed Australians’ hearing. But Tasmanians can hear just fine - and they now know that Tony Abbott wasn’t straight with them before the election.

This is a Budget that creates a new deficit in public trust. Seven dollars might be just the price of a cigar to the Treasurer, but for many vulnerable Australians, it is a significant impost to pay to see a GP - enough to make people think twice about seeing a doctor.

To advance his chances of getting work, James Kelly has completed courses with Mission Australia and volunteered his time with local charities. It’s organisations like Mission Australia and Anglicare in Tasmania - like other charities - who will be expected to pick up the pieces after the Government’s demolition of universal health care, and cuts to the aged pension and other welfare. And yet not even charities are beneficiaries of this Federal Budget.

Many services, including indigenous programs that close the gap, are being wound up or face being axed because up or face being axed because up or face being axed because up or face being axed because of a lack of funding certainty.

The national and independent regulator set up to support charities, the Charities and Not for Profits Commission, is also on the chopping block. The sector, at the heart of our communities working with the vulnerable, is being treated with contempt.

As a state whose average income sits below the national average, Tasmania will be particularly hard hit by the Budget. This isn’t just bad social policy, it’s lousy economics. Like other conservative state leaders, Premier Will Hodgman recognises the implications of the cuts to health, describing them as “untenable and unsustainable”.

Our nation works best when we draw on the talents of all Australians, and invest in schools, vocational training and broadband to lift the country’s productive capacity.

This piece was published by The Hobart Mercury, Wednesday the 21^st of May 2014.