A look at the 2019 Budget

Andrew Cairns from Community Sector Banking runs through his main takeaways from this year’s federal budget and questions how many everyday Australians will feel the relief from the promised surplus.

With the shadow of an important election looming, the federal budget has been delivered and has claimed to have brought Australians “back in the black and back on track.”

But further analysis reveals more questions – the overall budget may forecast a $7.1 billion surplus for next year, but how many everyday Australians will feel the relief of those numbers?

The government budget may be back on track, but communities that rely on social services and not for profits likely are not.

Tax reform

Many families will welcome the new income tax cuts which more than doubles the low and middle-income tax offset by providing relief to 10 million Australians, with 4.5 million receiving the full $550 rebate. When combined with the 2018 budget package, the saving is $255 for low-income earners and $1,080 for middle-income earners.

But with the rising cost of living and a housing market that remains unattainable to millions of first time buyers, these rebates will do little to fix much bigger structural problems that are risking the economic and financial stability of so many Australians.

Housing affordability

Housing affordability remains one of the biggest concerns among Australian families in most of the major cities.

The budget offers $1.7billion for affordable housing but there was nothing committed to helping first time buyers get a foothold onto the housing market. This is the second year in a row that potential first time homeowners have been left out in the cold wondering if and how they will ever afford a down payment to buy a house.

Without significant federal support, an entire generation of Australians risk missing out on homeownership and what for many is the biggest investment of their lives.

Immigration

The government announced it would reduce the permanent migration target by 30,000. This means the permanent migration target will be capped at 160,000, down from the current cap of 190,000.

Overcrowding and congestion has been given as reasons for this decrease, but many well-respected economists believe that population growth through immigration is actually essential to a thriving and growing economy. Skilled immigration benefits Australia and cutting these numbers risks our competitive stance in the broader world economy.

Many will also need reassurances that this cut isn’t fuelled by darker motivations steeped in racism and the fear of the growing multicultural landscape and influences across Australia.

Refugees

The federal government is projecting that it will save $79.9 million by supporting newly arrived refugees for longer by receiving English language skills and support services for 12 months before requiring them to take part in government-mandated job-seeking.

Currently refugees are required to look for work with Jobactive after just six months on income support which has resulted in longer dependence on the support as a result of not being adequately prepared to seek jobs.

So much more needs to be done to support refugees coming to Australia for a better life. If we support them early on, their chances of settling into Australian society as equal participants and contributors will greatly increase. If we treat them as “others” and simply as a drag on our economy, we risk alienating some of the most vulnerable among us, delaying the great impacts they may have in our broader communities.

Foreign aid

The budget saw a slash in foreign aid by more than $115 million.

By decreasing foreign aid, many believe Australia isn’t pulling its weight in contributing to multilateral funds like the World Bank’s International Development Association and the Asian Development Fund.

As a developed and prosperous nation, many would argue that we have a responsibility to support and assist in the development of nations struggling to keep up. Decreasing foreign aid also risks Australia’s influence on the global stage, most notably our influence in Asia.

Welfare

The government says that more than $2 billion in budget savings will be made from a new system that will significantly decrease overpayments to welfare recipients. This means that some employers will need to report the income of welfare recipients to the Department of Human Services through the Single Touch Payroll system.

The problem is that there is an assumption that many welfare recipients are falsely declaring their income or are intentionally taking advantage of welfare support. For those of us working in the not-for-profit sector, our experience is that too many Australians struggle to make a living based on their wages and require additional support to feed their children or provide a safe home for their families.

Being on welfare does not provide an easy life and we need to ensure there is ample support for those who find themselves in need of some extra help.

Domestic Violence

We were pleased to see a commitment to combating the crisis of domestic violence that impacts all sections of Australian society. The budget will offer an extra $328 million over three years for frontline services ($82 million), safe places ($78 million), prevention strategies ($68 million), hotline service ($62 million), and support and prevention measures for Indigenous communities ($35 million).

No communities are untouched by abuse within our households and as a nation, we must make the issue of domestic violence a top priority not just in the budget, but in government policy, in education and in supporting not for profits dedicated to caring for those affected by abuse.

Disability

After initial hesitation, the federal government has come on board to support a royal commission into violence, abuse, neglect and exploitation of people with disability and will commit $527.9 million over five years.

Abuse suffered by people with disability have largely gone without consequence and we applaud the funding of a royal commission to bring to light and to acknowledge a broken system that has allowed systemic abuse to happen for far too long.

Of the $527.9 million, the budget will spend $379.1 million to provide legal assistance to witnesses and to run the inquiry and it will provide another $148.8 million for counselling over three years to those who participate in the commission.

The $1.6 billion reduction in the National Disabilities Insurance Scheme payments for 2019-20 will be questioned as many have argued that the slower than expected uptake is not due lower demand, but problems in people accessing the scheme.

Mental Health and Suicide Prevention

The budget provides an additional $461 million investment in a youth mental health and suicide prevention strategy.

Suicide affects so many families in communities all around Australia. We have seen some of the worst natural disasters hit regional and rural communities through drought and fire and a result, we have seen an uptick in mental health challenges including depression and suicide.

The budget allocated another $5.5 million over four years to provide mental health services for people in Tasmania, Victoria and Queensland who have been affected by natural disasters.

Suicide affects Indigenous communities much more than any other Australian community. The budget has provided a further $5 million over four years to implement suicide prevention initiatives targeted at Aboriginal and Torres Strait Islander people.

Indigenous health

The additional $5 millon earmarked for suicide prevention within Indigenous communities seems to be a welcomed acknowledgment that much more support is needed to save the lives of Aboriginal and Torres Strait Islander youth.

Indigenous communities suffer disproportionately higher rates of suicide, cancer, kidney disease and obesity compared to non-Indigenous Australians. But overall, the budget does not seem to provide funding to match this critical need.

Climate Change

$3.5 million will be put towards a climate solutions package which the government says will help the country meet its Paris target. The budget allocates $100 million to an Environment Restoration Fund which will support community groups for local projects like waste recovery, recycling and managing waterway erosion.

But there was no talk of the elephant in the room: climate change. According to the Australian Conservation Foundation, the government plans to spend $4.36 subsidising pollution for every dollar it spends on climate action.

Our nation of natural beauty and wonder has one of the worst extinction records. Until our politicians treat climate change as a world-wide critical and urgent emergency, we will fail future generations who will inherit our dirty legacy.

We can all do better to reverse the course of climate change, and we ask our leaders to step up and take the lead by supporting clean and innovative ways to create energy without damaging the health and future of our planet.

Pro Bono News’ 2019 budget coverage is brought to you by Community Sector Banking.