With the 2020-21 Federal Budget less than two months away, Prime Minister Scott Morrison and his Treasurer Josh Frydenberg have been softening up the public for the potential political fallout if they fail to deliver their much-touted Budget surplus.
The coronavirus, this summer’s bushfires and the ongoing drought have the Government justifiably nervous about what this might mean for the Budget and its reputation as strong economic managers.
The Australian economy has been vulnerable to external shocks for some time. Low wages growth, rising levels of underemployment and a general decline in living standards are affecting middle Australia.
The combination of all these factors has the Coalition scrambling to protect the economy and to provide Australians with some reassurance that they are on top of things.
The Government’s 2019-20 Budget narrative was “A strong economy helps the Government guarantee the essential services Australians rely on”. They had used the Budget to show themselves as strong stewards of the Australian economy. The Budget was also used to frame the nexus between a strong economy and a guarantee that essential services will be delivered to Australians.
In doing so, the Government could argue that its focus on the economy was a means to deliver essential services, rather than an end in itself.
So it was of considerable interest to hear the Treasurer mocking his Opposition counterpart, Jim Chalmers, for suggesting Australia might follow the lead of the New Zealand Government and introduce a “Wellbeing” Budget.
The New Zealand Government introduced its new “Wellbeing Budget” in 2019. In her 2019 Budget Statement, Prime Minster Jacinda Ardern wrote: “New Zealand has had strong [economic] growth for a number of years, all the while experiencing some of the highest rates of suicide, unacceptable homelessness and shameful rates of family violence and child poverty. Growth alone does not lead to a great country. So it’s time to focus on those things that do.”
In essence, Ardern’s Government is seeking to expand how it assesses its own success by including metrics in addition to the traditional economic ones. In reshaping the way in which the New Zealand Budget is assessed, Prime Minister Ardern has opened up a new front in public policy thinking – one where economic metrics are no longer the primary focus.
If there was cause to rethink how we view the success of the Federal Budget, the latest Poverty in Australia report released by the Australian Council of Social Service offers us plenty to consider.
According to this report, more than three million people in Australia are living in poverty, of which some 750,000 are children. The report highlights the ongoing problem with Australia’s welfare payment system, finding that, in most cases, people need private income above and beyond social security in order to escape poverty.
The inadequacy of welfare payments continues to be a driver of poverty in Australia. That is why Catholic Social Services Australia has been calling for the establishment of an independent mechanism to assess the adequacy of all welfare payments, especially pensions and allowances such as Newstart. It is also the reason we have been calling for a job guarantee to provide real jobs to people currently without work or without adequate hours of work.
The ACOSS report highlights income – or the lack of it – as a key factor driving poverty in Australia. However, income is one of several factors that drive persistent disadvantage, as CSSA’s upcoming research report, Mapping the Potential, shows.
CSSA has been collaborating with 21 of its members and with the ANU’s Centre for Social Research Methods to identify the drivers of persistent disadvantage in Australia. The research, to be launched next week, examines a range of economic, health, education and social factors driving persistent disadvantage.
It also looks behind the “averages” that all too often hide the true picture of disadvantage. Importantly, in expanding the suite of drivers considered as critical in creating persistent disadvantage, we get important insights into the policy directions needed to address them.
Like the “Wellbeing Budget” in New Zealand, CSSA’s research provides a more holistic picture of Australian society, especially around those suffering persistent disadvantage. In doing so, it opens the door to the development of more targeted and innovative approaches, which can better serve the poor and vulnerable in our society.
CSSA, like its members, exists to serve vulnerable people. It is essential that we do so using the best evidence available to us.
We need to look at the whole picture, as complex as it is, and find a way forward to addressing persistent disadvantage in Australia. There are more than three million people in Australia counting on us.
Joe Zabar is deputy CEO of Catholic Social Services Australia.