TRANSCRIPT
Australia is the fourth wealthiest country in the entire world but it still has too many people going without. The country has seen a surge in wealth inequality over the last 20 years and those with the least well off getting the short end of the stick. The average wealth of the highest 20 percent grew at four times the rate of the lowest. Scientia Professor from the University of New South Wales Carla Treloar says wealth inequality affects everyone.
"National Evidence shows us that equality more equal societies have better results on things that really matter to us mental health, life expectancy, infant mortality, obesity outcomes from school, all things that really set out set us up for a healthy or a not so healthy society in which we spend a lot of time and effort and money trying to fix. Inequality is also important for economic growth inequality stymies economic growth, and when wealth and power is concentrated in the hands of the few, it can undermine trust in government and our social and political stability."
The Poverty and Inequality Partnership and the University of New South Wales launched a report which indicates that between 2003 to 2022, the wealthiest 5 percent and 20 percent increased their wealth by 86 percent and 82 percent respectively. This is compared to the middle 20 percent with 61 per cent wealth increase and the lowest 20 percent with only a 20 percent increase. The study shows that the disparity was fuelled mainly by superannuation, which grew by 155 percent due to compulsory savings property investment. Cassandra Goldie is the chief executive of the Australian Council of Social Service (ACOSS).
"Wealth begets wealth, that's the reality. And these are not just accidental events, they because of policies that were committed to over the last 20 years during a boom era, during when there was enormous wealth Australia is one of the wealthiest countries in the world, but over the last 20 years, we allow our income support payment, if you're unemployed to become the lowest in the OECD of all of those countries. And at the same time, we delivered eye-watering tax cuts and tax breaks for people who are property investors, or what was done to superannuation."
The Inequality in Australia 2023 report shows that the government’s timely COVID-19 pandemic response reduced income inequality, but only temporarily. Ms Treloar says while income disparity has remained relatively steady, wealth inequality has risen over time. She says plans should be put in place to reduce the disparity.
"Income support payments during COVID pulled almost overnight, half a million people out of poverty, that impacts on individuals and of course, children in those families who have more resources for schooling for education, for activities that we want all of our children in Australia to be able to benefit from. Unfortunately, with the winding back of those supports, we see poverty rates and insecurities bouncing back to pre COVID levels and producing this inequality in wealth and in income. that we're seeing in the most recent results."
Ms Goldie says the situation could intensify divisions across generations, people of diverse backgrounds, and social groups. She believes the situation can be managed through affordable housing and a fairer tax and superannuation system.
"We're at the point now where people who are over 65 Only one in five are paying any kind of income tax, Superannuation is very, very generous the people who have the most so we the the, the way to tackle inequality in Australia is very clear. This is not an accident. It is about policy changes we need and we need them fast and we need them now. We need to firstly, fix the adequacy of income support for people with the least we demonstrated how overnight we can lift over 500,000 people out of poverty. people in Australia know the poverty is absolutely something we can fix. We just need to do the right thing."
And Charity organisations are calling for urgent government response to the situation. Mission Australia’s chief executive Sharon Callister says the COVID experience was a missed opportunity to raise incomes in poor households and reduce the risk of homelessness.
"In 2020, significant additional COVID income support payments successfully raised household incomes and reduced inequality, trends that were reversed when the payment was removed. Poverty is the main underlying structural cause of homelessness and alleviating poverty is an essential part of preventing and ending homelessness for good. Adequately raising income support is a crucial policy response. Income support should do what it’s designed to do: protect people from poverty, not condemn them to it"
And chief executive of the Australian Research Alliance for Children and Youth (ARACY) Penny Dakin says children born into low incomes households will bear the impact of financial stress.
"But what we also know is that those kids are likely to experience these impacts well beyond now into their future lives. They are much more likely to experience unemployment themselves; they highly likely to interact with the criminal justice system and that they are more likely to experience these same conditions that their parents have experienced. "
Ms Dakin says it is important for Government policies to level the playing field for all, especially for children, rather than deepening the divide.
"Large injection of income into these families is a really important step that has to be considered. So, we saw the Australian government increase its income payments at the last budget but very small amount. What we need to see at the next budget is a real commitment from the government to increase those payments further. And then we need to do that coupled with meaningful investments in place and they need to commit to listening to communities tell them how best that funding should be spent. "
ACOSS chief executive, Ms Goldie says Australia needs to do better to create a society where everyone is financially equal.
