Who are the real bludgers?
Date
March 13, 2013
The Age.
Welfare dependency, most agree, is an ugly thing. It is also a loaded term that brings to mind bludgers addicted to government benefits.
We're not thinking, of course, of the 44 per cent of taxpayers who get more in benefits than they pay in. Who dares suggest ''working families'', even if quite well off, are guilty of some sort of moral failing for accepting state handouts?
It seems the better off feel entitled to better treatment by government. Their status as wealth generators is a passport to ''diplomatic immunity'' from accusations of sponging off the state - however disproportionate to need their benefits and tax concessions may be. Similarly, while age pensioners get the biggest slice of $132 billion in welfare spending (36 per cent of the budget), they are seen to have earned the right to be dependent on government - even those living in $1 million-plus homes. Pensioners and their assets are untouchable, too.
The young, unemployed and single mothers are subject to a different standard. They get lower benefits, often too low to keep them out of poverty, but are treated as a morally suspect underclass that lives off taxpayers who have worked hard for everything they have.
The young jobless have even been accused of being ''job snobs'' who just need to get off their bums to find work. Under-30s in areas with unskilled job vacancies may lose benefits under the Coalition, which also wants long-term unemployed under 50 to work for the dole. Their ''free ride'' is set to end.
Single mums have already copped it. The Gillard government shifted them from a single parent benefit to Newstart, which allows fewer hours of paid work before payments are cut. The government disregarded the impact on low-income families to save $728 million over four years.
However, much better-off ''working families'' who have come to rely on government to boost their finances seemingly have little to fear from the bipartisan savings drive.
Families with children are the second-biggest recipients of welfare spending - about $34 billion a year. Most goes on family tax benefits A and B, but there are also childcare benefits and rebates, paid parental leave, schoolchildren's and baby bonuses and carer allowances. The full list of family benefits is very long.
Many who receive family welfare are, on any reasonable definition, not needy. Couples with two children in the middle 50 per cent range of incomes ($80,000 to $135,000) may qualify for most or all of the above benefits. One partner can earn up to $150,000 and the second up to $25,623 and they can still get something from Family Tax Benefit B, which costs about $4.5 billion a year.
A reality check on incomes: 50 per cent of households had incomes below $65,000 in the 2011 census. Half of all workers earn $50,000 or less.
Given how much welfare money goes to middle and high-income families, you'd think the budget costs of ''middle-class welfare'' would be a natural target for savings, especially when Abbott has declared: ''The fiscal position will always be better under the Coalition because budget surpluses and reducing debt, paying back debt, that's in our DNA.''
Yet family payments seem to be off-limits. The Coalition even proposes to add Abbott's $3 billion-a-year paid parental leave plan so benefits for high-income earners are proportionate to their earnings.
When last year's budget trimmed the baby bonus for households with incomes of up to $75,000 in the six months after birth, this was said to be a ''vicious and savage'' attack on families. But just because maternity allowances are an Australian tradition - Labor started them at five pounds in 1912 - that does not mean we can afford to make such benefits an inviolable universal entitlement.
What about private health cover, which gets government support worth $5 billion a year? Policy holders received a 30 per cent rebate on premiums regardless of incomes until the government legislated last year to reduce rebates for single people earning more than $83,000 (the top 20 per cent) and families more than $166,000. Rebates cut out at $129,000 and $258,000. The saving is $2.4 billion over three years.
Abbott vows to restore the full rebate for all as soon as possible, for the usual genetic reasons. ''Private health insurance is in our DNA. It is our raison d'etre, that is why we exist as a political movement, to give more support and encourage people who want to get ahead.''
They're getting ahead all right, especially via superannuation. Tax concessions cost $32 billion a year, but any move to stem the bleeding has the beneficiaries and their advocates screaming ''class war''.
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