As the 20th year of Anti-Poverty Week kicks in from October 16, I have reflected on a series of discussions I was involved in 11 years ago when I was President of ACOSS. It was a time of high expectation – not unlike the recent national Job’s Summit convened by the Federal Government.
Back then it was the national Tax Summit held in Parliament House in Canberra. With the Henry tax review of the day recommending a need to transform our system of raising tax revenue and distributing payments through income support the Forum was designed to generate a broader debate about a roadmap for tax and transfer reform.
Why did this forum come to mind as we launch into another week of putting the spotlight on Poverty in Australia?
Certainly not because it kickstarted long awaited and anticipated change to make our tax and transfer system fairer and more effective – alas!
But because if we are ever to be truly serious about changing the fundamental conditions that cause poverty to continue to exist in Australia (and yes, the evidence is that we have largely failed to shift the dial on poverty levels in Australia over the past 20 years) then we must do something about how we distribute wealth across our nation. We suffer poverty levels that consigns 1 in 6 Australian children to live in households who live below the poverty line and unable to meet basic needs of safe and secure housing, nutrition and health. Not because Australia as a nation doesn’t generate sufficient wealth – but because we fail to ensure it is shared in a fair and equitable way across our population. We don’t need to strive for more wealth generation, but we do need to do something urgently about how it is being distributed.
Getting a fairer tax and transfer system isn’t rocket science. There was more than enough evidence provided to the Tax Forum 11 years ago about what this should look like and how such changes could be introduced in Australia. You won’t be surprised to know that what we are now looking to implement in the guise of Stage 3 tax cuts to benefit our wealthiest income earners wasn’t one of the ideas put forward at the Summit. Yet we don’t seem to have political leadership that it is prepared to implement what would be a more just means of ensuring more people were able to share the benefits of the wealth this country generates. These highly inequitable and unjust tax cuts might be politically expedient – but they represent a failure in good and fair public policy.
If we are serious about reducing poverty levels in Australia, then the debate must start about how we generate tax revenue that ensures that those who can (and should) pay their fair share of tax through all available tax measures do so. And if we can achieve this, we will be in a position to enable our various income support payments which underpin the living standards of our poorest citizens provide for a decent life. It is no surprise that the most recent snapshot of Poverty in Australia authored by ACOSS/UNSW showed that when income support payments were boosted during the peak of COVID we were able to get poverty levels in Australia to their lowest level in 17 years. It was as simple as that – 1 major public policy lever adjusted and in just 1 quarter we see poverty levels decline significantly.
But this wasn’t sustained and in part the reason provided has been the pressure on the current budget and managing debt.
Had we been prepared to not only have a debate but to enact reform to our tax system that ensured sufficient revenue generation to provide adequate income support for those who need it we wouldn’t now be staring down blowouts again in our poverty rates. There is no more effective way to reduce poverty in Australia than through recalibrating our tax and transfer policy settings. It needs some political courage and leadership without a doubt but without it we are doomed to be looking at 1 in 6 children (and most likely more) being destined to having the worst possible start to life. Surely that makes us the Unlucky Country!
Simon Schrapel AM
Chief Executive
Uniting Communities
