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Ben Spies-Butcher on the 2014 Federal Budget

JOE HOCKEY BUDGET UPDATE

Economic sociology member Ben-Spies-Butcher was one of a number of academics and researchers to provide comment on the The Conversation last night regarding the budget. The other contributions are available here.

Ben Spies-Butcher, Lecturer in Economy and Society, Department of Sociology at Macquarie University

“As expected, the government has targeted pensions for cuts. People will have to worker longer, and pensions will become less generous over time. This comes only a few years after pensions were increased due to concerns over aged poverty, which is higher in Australia than most rich countries.

The changes to indexation will see pensions increase at the rate of the unemployment benefit: a system which has seen these benefits fall below the poverty line.

Australia’s public pension is less expensive than almost any other in the developed world. It will grow at half the rate of superannuation tax concessions, which are among the highest in the developed world.

Yet the government has sought to tinker with means tests, payment rates and eligibility while leaving superannuation untouched and unmentioned. Addressing tax concessions would do much more for revenue, efficiency and equity than the small change to top marginal tax rates.

The one brighter note is a payment to businesses employing older Australians who have been out of work for over six months.

It is hard to see the pain being “shared equally”. Australia’s taxes are well below those in other rich countries, yet the government has focused on cutting taxes, not fixing the loopholes.

It will see many Australians working harder and longer, and older people falling behind community standards. This comes at a time when Australia is one of the richest countries with one of the smallest debts in the world.”

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