Rachel Siewert (WA, Australian Greens) Share this | Hansard source

I present the report of the Community Affairs References Committee: Bridging our growing divide: inequality inAustraliareport together with the Hansard record of proceedings and documents presented to the committee.

Ordered that the report be printed.

I move:

That the Senate take note of the report.

I thank all the witnesses and people who provided submissions to the inquiry. I also thank the secretariat of the committee for the hard work that they put into this inquiry and into helping us pull the report together. Unfortunately, I have presented a report that is not a consensus report. I have presented a majority report from the Australian Greens and the Australian Labor Party. As part of that report, the coalition have a dissenting report, which I am sure Senator Seselja will speak to. As chair, I have also made some additional comments on behalf of the Australian Greens, which I will come to shortly.

First off, I would like to outline the report and the key findings of the report. We had 64 submissions, which presented very valuable evidence to this committee. We also held hearings and took evidence from around Australia, which, again, presented us with a lot of evidence. We also made sure that we went to some of those areas with high rates of unemployment that have been identified as priority areas for some of the employment programs that the government is introducing.

The evidence before the committee showed that income inequality in this country has increased since the mid-1980s. The evidence also showed that the likely impact of the budget measures will exacerbate income inequality and poverty in Australia, and that the Henderson poverty line and the 50 per cent of median income poverty line indicate that there are far too many vulnerable Australians—individuals and families in receipt of income support—who are currently living in poverty. The evidence provided to the committee also shows that the level of Newstart payment is too low. The income of a single adult Newstart recipient is now more than $100 below both the Henderson poverty line and the 50 per cent of median income poverty line.

We made findings on the importance of the minimum wage and that it remains an important mechanism for low-income people to avoid poverty and participate in society. The evidence shows that the minimum wage makes a significant difference to income inequality and rates of poverty, and it is important that the minimum wage is set at a level that reflects the rising cost of living in Australia.

There is a socioeconomic gradient associated with a large range of health outcomes. Poor health outcomes are recorded for those with low incomes, and a focus on preventive health and improved access to primary health care, especially for lower-income people, will assist in lifting a number of these measures. We also looked at people who are in particular groups of disadvantage, such as Aboriginal and Torres Strait Islander peoples, people with disability, people living with mental illness, single parents and newly arrived migrants and who are more vulnerable to poverty and disadvantage. We also found that lower transfer payments or a low income often compounds the extent of disadvantage felt by people in those particular groups.

We looked too at the impact of not being able to gain employment—and that obviously has very significant impacts—but we also received evidence that insecure, casual, temporary, short-term contracts impacts on people on low incomes so that they become subject to income inequality. We considered what could work for people in helping them to access employment. A lot of evidence talked about the need to access stable employment and the impact employment has on people's income status and inequality. We also looked at issues such as the impact that affordable housing and stable housing can have on people's prospects and life outcomes and inequality. Further, we considered the mobility of labour.

The committee made 13 recommendations around issues such as an analysis of the budget and its impact on income inequality. We also recommended that income support measures in the current budget do not proceed. Those budget measures include moving young people off income support for six months, indexation of parenting payments single and changes to the indexation of pension payments. We also looked at the impact of inequality on older Australians. We made recommended that the changes to the GP co-payment and to higher education do not proceed. The majority report also recommended that the Australian government review the level of working age payments to examine the rate of payment to the poverty line. While I agree with that recommendation, the Australian Greens submitted additional comments that Newstart and youth allowances need to be increased. The evidence on that point was absolutely overwhelming because of the impact that the low rate of Newstart and youth allowance has on people's poverty and opportunities to gain employment.

I know that my colleagues on the committee will bring out other points in the report. I will run out of time to do justice to all the issues that we considered, but one of the key points that I would like to highlight is that not only is it clear that income inequality has increased, but that people assume that if this country does better, then—and we heard this expression a lot—with the rising tide all the boats rise. In fact, the evidence we received does not support that. It is very clear from a report which was released during our inquiry by the Bankwest Curtin Economics Centre that income inequality in my home state of Western Australia has risen and it has risen more than anywhere else in the country. Their report relates that directly to the mining boom. In fact they have done two reports that were relevant to this inquiry—one on the impact of the boom in Western Australia and one on income inequality. They used the median line of poverty as 30 per cent. The point that they make really clearly is that the benefits of the boom have not been shared across all the quintiles and that those in the lowest quintiles have not received the benefits of the boom. In fact, income inequality has increased in Western Australia and that fact is connected directly with the mining boom.

Those are the sorts of issues that need to be addressed. Our recommendations consider this and also the way to address housing and education, as well as improving support for unemployed people. Another recommendation is for case management for unemployed people, and there was overwhelming evidence that the individualised approach is by far the best. We also considered the impact the taxation system on inequality and, when the government issues its white paper on taxation reforms, it needs to consider that impact. From the evidence it is clear that government policies on taxation can have a direct impact on income inequality. The bottom line is that income inequality has significant negative effects and that it actually helps our economy if we reduce income inequality. I commend the report to the Senate and urge senators and the broader community to read the report.