- by Anna Pha
- The Guardian
- Issue #2052
Photo: pixabay.com (CC0).
Budgets involve a redistribution of wealth reflecting government priorities and serving class interests. The 2023-24 federal budget has clear priorities. The big winners are the military industrial complex, the rich, property investors, and fossil fuel corporations. The big losers are the unemployed, students, pensioners, people with disabilities, the aged, renters, those on low wages, and the planet.
“In all our decisions, we seek to strike a considered, methodical balance,” Chalmers says as he tips the scales heavily in favour of the wealthy and the military-industrial complex.
The budget throws a few crumbs to those in need, ramps up spending on war preparations, and serves up a few token measures to address climate change. It is set to the background of a looming global economic crisis.
Labor fails to live up to its big promise of addressing the cost-of-living crisis and lifting people out of poverty. The much-touted $14.6 billion package is a fizzer. The amount is over four years – an average of $3.65 billion per annum. That’s peanuts in a $684 billion budget.
The headline items are designed to sound as if they are delivering on the promise of a cost-of-living budget: Energy price relief, reducing out-of-pocket health costs, reducing the cost of medicines, and support for those who need it most. For good measure, there’s sustainable income support, more affordable housing, keeping wages moving, cheaper childcare, and enhanced paid parental leave. Chalmers calls the budget “responsible.”
COST OF LIVING
A reading of the fine print reveals the inadequacies of these measures. Out of a total budget of $682 billion, the government is allocating $4.9 billion over five years to increase JobSeeker, Youth Allowance, and Austudy by a punitive $40 a fortnight, ($2.86 a day).
The $20 a week increase to JobSeeker is well below the Economic Inclusion Advisory Committee’s finding that it needs to rise by at least $128 a week to ensure people can cover the basics.
The higher JobSeeker rate of $745.20 per fortnight for those aged over 60 is extended to include those 55 and older who have been receiving the payment for at least nine consecutive months, but still leaves them struggling. This will cost $69 billion over the next four years compared with the $14 billion in cost-of-living relief package.
But that is not all. The low- and middle-income tax offset will cease, as previously determined by the Coalition. The withdrawal of this offset amounts to an increase of up to $1500 in tax paid. At the same time the $9000 tax cut next year for those on taxable incomes of more than $200,000 remains in place.
Early childhood educators are denied a wage increase. Funding is, however, provided for a 15 per cent increase in the wages of aged care workers.
The Budget delivers a 15 per cent increase to Rent Assistance, the first increase in more than 30 years. At an additional $15.50 per fortnight increase, the Commonwealth Rent Assistance barely touches the current rental crisis with its long waiting lists for public and social housing, and private rental increases of up to $200 or more per week.
The increases in social security payments will still leave more than one million people in poverty, unable to afford three meals a day and a roof over their head.
The Single Parenting Payment will be expanded to single parents whose youngest child is aged up to 14. At present women lose the payment and are transferred to the lower, inadequate JobSeeker Payment when their youngest child turns eight.
There is a one-off $500 subsidy for electricity bills for social security recipients and small businesses. But that too will fail to alleviate the current hardships that recipients face.
The Coalition’s regressive Stage 3 tax cuts of $254 billion for the rich over 10 years (more than half a trillion dollars over 20 years) are not being repealed. These will only widen the wealth gap and consume revenue that could have been redirected to meeting people’s needs.
The government hopes to take pressure off our public hospitals and emergency departments with a $3.5 billion boost to help GPs bulk bill around 11.6 million eligible Australians. Eligibility includes children, pensioners and other concession card holders.
Rebates to GPs who bulk bill will be higher but there is no attempt to restore universal bulk billing by making it financially viable for GPs. Some pharmaceuticals will be cheaper.
Tax on superannuation earnings for balances over $3 million will be increased from 15 per cent to 30 per cent. While a progressive move, it will not end the use of superannuation for tax rorting by the wealthy.
The government sees security in terms of military spending and war preparations. Its priorities are clear: Military spending is ramped up to more than $50 billion per annum with larger increases to come when construction of the nuclear-powered submarines and other AUKUS-related spending gets under way.
The $368 billion for nuclear-powered submarines appears increasingly elastic. Nearly $20 billion will be spent over the next four years implementing the aims of the Defence Strategic Review. Capital expenditure over the coming four years on the military is $33.7 billion.
Some of the military budget is buried in the portfolios of the Attorney-General, Department of Employment and Workplace Relations, Department of Finance and Department of Education.
Fossil fuel tax credits ($9.4b in 2023-4) remain, as fossil fuel corporations are put before people and the planet. The approval of new projects means fossil fuel corporations will continue spewing out greenhouse gases. The government attributes much of the turn-around in the budget to a surplus of $4.2 billion to coal, gas, and oil exports.
The war preparations and tax cuts are set to rob future budgets of more than $1 trillion over the next 20 years. At the same time health, social security payments, housing, the NDIS, education, and climate change receive token increases.
Changes to the Petroleum Resource Rent Tax (PRRT) will raise only $600,00 per annum at a time of record gas prices. This is a missed opportunity for raising far larger returns from our resources. A larger amount might also act as a disincentive to further gas projects.
The government’s priorities are clear – this is neither a people’s budget, nor a peace budget.