Labor’s social policy framework lays strong foundation to reduce poverty and inequality

17 March 2016

ACOSS today welcomed the Labor Party’s newly-released social policy agenda.

“In a political system that’s adrift in the daily media cycle, Labor’s social policy agenda brings long overdue attention, focus and rigour to efforts to reduce inequality and poverty, placing good social policy at the centre of good economic policy,” said Dr Cassandra Goldie, ACOSS CEO.

“The platform builds strong foundations for policies to reduce inequality and poverty, including full employment, decent incomes, universal services, and shifting power to communities.

“We need more of this kind of serious, long-term policy thinking from all sides of politics. Affordable housing and a fair and efficient tax system should also be added to the mix,” said Dr Goldie.

“The statement signals the need for well targeted public investment in benefits, services and community infrastructure from a future government. This is an investment, not a cost. In our view there’s no conflict between investing in people and growing the economy: they are one and the same thing. It’s vital that governments make room for these investments rather than imposing arbitrary caps on public spending.”

Inequality and poverty:

“We need governments with high ambitions for Australia, and full employment and reducing poverty and inequality are important ones.

“They are also achievable: 29 out of 33 OECD countries – including wealthy nations such as Germany, the Netherlands, the United Kingdom and Canada, have less poverty than we do. Twenty OECD countries have less income inequality than Australia,” said Dr Goldie.

Employment and incomes:

“ACOSS welcomes Labor’s commitment to a full employment objective, an expert review of the adequacy of Newstart Allowance and its acknowledgement that the purpose of family payments is to prevent poverty among children. Taken together, these are the most important things governments can do to reduce poverty in Australia.

“Full employment is not a mirage: it remains a legislative objective of the Reserve Bank and should be the goal of governments as well.”

Over three quarters of a million people have to rely on the $37-a-day Newstart payment, of whom over half a million have been unemployed for more than a year. The Labor policy platform aims to reduce the poverty and waste of mass unemployment in three ways: ensuring there are enough jobs, investing in better employment services for people unemployed long term so they have a good chance of securing a job, and improving benefits so that people can live decently while searching for jobs. All three strategies are needed.

Labor’s social policy agenda calls for the replacement of the two parts of Family Tax Benefits: Part A for all low and middle income families and Part B for single income families, with a single payment.

“ACOSS supports reforms to simplify the family payments system. It is vital that any redesign of family payments gives priority to reducing child poverty and improves the circumstances of sole parent families who are living in poverty,” said Dr Goldie.

“ACOSS agrees that we need to strengthen workforce participation – especially among people unemployed long term, people with disability, older people and parents with young children. This requires a concerted effort to adjust workplace practices and end discrimination, seriously invest in skills and training, and provide the child and elder care services people need.”

Essential services:

ACOSS welcomes the commitment from Labor to investing in essential services like needs-based schools funding, early childhood education for all three and four year-olds, and decent employment services for people unemployed long-term.

“If well designed and properly resourced, these services not only improve lives, they save governments money in the long run and grow the economy. Much of what we call ‘good social policy’ is actually good economic policy as well,” said Dr Goldie.

Community services and empowerment:

“Labor’s commitment to fairer and more robust funding arrangements for community services is welcome. Communities cannot respond to needs in an innovative way as long as funding is tied strictly to a narrow set of inputs. They cannot collaborate as long as they are forced to compete with other services to deliver services at the lowest price.”

Close cooperation between government and representative organisations in the community is needed to get these funding arrangements right. Also important is a new emphasis on empowering local communities and service users, especially in disadvantaged areas, by working with them to identify needs and service gaps rather than dictating from Canberra which mix of services they should provide.

The platform commits to the establishment of an independent body to strengthen evaluation of social policy and to ensure that social policy is firmly integrated with economic policy decisions.

Together with open sharing of government data, this approach could revolutionise government. The agenda explicitly rejects seeing social investment as a drag on the economy but adopts the view that social investment is central to reducing inequality, driving economic growth which is inclusive, with job creation at its core.

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