Australian Government Budget 2018-19: Response from the Centre for Social Impact

What does the 2018-19 Budget mean for society? Is this budget creating the Australia we want? This piece summarises the Centre For Social Impact's response to last week's budget release. The Centre for Social Impact is a collaboration between the University of New South Wales Sydney, the University of Western Australia and Swinburne University of Technology, with the purpose to catalyse positive social change. According to the Centre's Chief Executive Officer, Professor Kristy Muir, the budget does not do enough to support the most disadvantaged or to address key social issues.

The budget has gone some way in recognising that further support is needed; for our people who are aged, for people with disabilities, and for assistance to manage the costs of electricity/gas; but it has not delivered on responding to climate change, broader responsibilities to aid in our region, for refugees or migrants.

The 2018 Budget has not delivered for our most marginalised or our most disadvantaged groups: the 1 in 200 people who are homeless on any given night, the almost 3 million people living in poverty, including 731,000 children, the almost 1 in 3 people who are in part-time or precarious employment, or the more than 1.3m people who are either unemployed/ underemployed and fighting for not enough job vacancies.

In short, the 2018 Budget has not delivered for Australian society.

The budget didn’t deliver for people in precarious employment situations. We know that almost one-third of people living in poverty in Australia are engaged in employment and report their main source of income is wages or salary. We have increasing numbers of people working part-time (31% of workers) and in casual or unstable contractual jobs. This group are significantly more at risk of experiencing severe or high financial stress.

For people who do not have a job, the 2018 budget responded with measures to keep ‘welfare spending under control’ and to ‘crack down on behalf of tax paying Australians’ through cashless welfare cards, enhanced debt collection activities, and longer waiting times for new migrants, rather than an increase to the Newstart allowance. This was despite shared support from across business and social sectors to #raisetherate which currently is below the poverty line and makes it difficult for people to have sufficient resources for housing, food and the expenses that come with looking for a job. 

We have seen increases in the number of people employed and increases in the number of jobs available, but this seemingly good news is tempered by the fact that we still have a situation where there are only enough job vacancies for fewer then 1 in 10 unemployed or underemployed job seekers (ABS Labour Force data from Feb 2018 showed: 220,000 job vacancies, compared to 731,500 unemployed and 1,102,000 underemployed).

Speaking of young people, there are some notable changes in education (beyond what was announced in the 2017 budget). Most controversial is the $247 million over four years for the National School Chaplaincy Program which will have a new focus on anti-bullying. A further $440 million will be dedicated to preschool education in 2019, extending the National Partnership Agreement on universal access to early childhood education for another year. 

There are some increased investments in medical research, but the news isn’t good for the vocational education and training (VET) sector which got no additional funding or initiatives, despite our young people still facing unemployment rates at over twice that of the general populations (12.5% compared to 5.5%). Students living in regional, rural and remote communities will have improved support to access further education, training and employment, along with specific Commonwealth Support Places being created for students commencing a Bachelor’s degree through a Regional Study Hub university.

The budget also left out housing affordability, beyond references to previous budget measures on the ‘supply of affordable housing’ through the National Housing Finance and Investment Corporation and some new releases of Commonwealth land. It did not address homelessness, even though we’ve seen an increase in the number (14% growth) and proportion (5%) of people who are homeless on any given night between the 2011 and 2016 Census. It did not address the waitlists for social housing (194,600 households). And the now-infamous $10/ week saving will not be sufficient to change the affordability of housing. The gaps are large. For example, the proportion of households in housing stress has significantly increased (from 14.1% to 17.4% between 2001 and 2016) and while we saw median annual rent and mortgage repayments more than double (2001-2016), median household income only increased by 83%.

One area that is encouraging, is that the budget has alleviated some concern over the NDIS, with the Treasurer stating it would continue to be fully funded. However, the change in funding source (from Medicare levy to tax revenue) has generated concern within the community. Importantly for the implementation of the NDIS, the budget does not address the current cap on the number on government employees which has led to an under resourcing of the implementation agency – the National Disability Insurance Agency. Key marginalised groups also continue to miss out on the NDIS, including people in prison.

Mental health is an area which is also receiving additional investment. The Budget provides $338.1 million in new mental health funding, with a focus on suicide prevention, research and older Australians, as well as advancing the Fifth National Mental Health and Suicide Prevention Plan. A new report released by Mental Health Australia demonstrates the clear economic case for investing in the mental health and wellbeing of Australians, so it’s important that the funding in the Budget is built upon going forward, given the years of under-investment we’ve seen.

There’s also positive news for impact investing. Building on $30 million of commitments in last year’s Budget, the Government will provide a further $8.3 million to support the growth of impact investing. $6.7 million of this will be directed towards building capacity in impact measurement, including through the development of an impact framework aligning with the ‘Australian Government principles for social impact investing’.

At the Centre for Social Impact, we do not believe that the 2018 Budget does enough to address key complex social issues or to support people who are most disadvantaged.