With the 2020-21 national budget deficit now standing at $134.2 billion Morrison & Frydenberg wield the financial razor – and it’s no surprise that COVID-19 support payments are first in line to be trimmed

 

The Final Budget Outcome 2020–21 was released on 30 September 2021 showing a general government sector 2020-21 budget underlying cash balance deficit of $134.2 billion and a net public debt of $592.2 billion which is 6.5% of Australia’s Gross Domestic Product (GDP) for the last financial year.

Given that Morrison & Co are positioning the Coalition for a second ‘presidential style’ federal election the immediate reaction was to fall back on a favourite Scott Morrison tactic as Treasurer and then Prime Minister – impose support payment cuts that would impact most heavily on low income individuals and households.

Australian Treasurer & Liberal MP for Kooyong Josh Frydenberg, media release, 29 September 2021:

COVID-19 Disaster Payment

Joint media release with

Senator the Hon Bridget McKenzie

Minister for Emergency Management and National Recovery and Resilience

Minister for Regionalisation, Regional Communications and Regional Education

The temporary COVID-19 Disaster Payment has supported around 2 million Australians with over $9 billion in payments made since it was announced in June this year.

Under the payment, eligible recipients have received $750 per week if they lost over 20 hours of work, $450 per week if they lost between 8 and 20 hours and $200 per week for those on income support payments who lost over 8 hours of work.

As part of our economic recovery plan, the temporary payment will begin to transition once a state or territory reaches 70 per cent full vaccination of its population (16 years and older) in line with the movement into Phase B of the National Plan agreed to at National Cabinet.

Once a state or territory reaches 70 per cent full vaccination, the automatic renewal of the temporary payment will end and individuals will have to reapply each week that a Commonwealth Hotspot remains in place to confirm their eligibility.

In line with the movement into Phase C of the National Plan, where a Commonwealth Hotspot remains in place and a state or territory reaches 80 per cent full vaccination of its population (16 years and older), the temporary payment will step down over a period of two weeks before ending.

In the first week after a state or territory has reached 80 per cent vaccination there will be a flat payment of $450 for those who have lost more than 8 hours of work, while those on income support will receive $100.

In the second week, the payment will be bought into line with JobSeeker at $320 for the week for those who have lost more than 8 hours of work, while the payment will end for those on income support.

For those who haven’t already returned to the workforce following the end of the temporary payment as the economy opens up, the social security system will support eligible individuals back into work.

The Government will also leave in place the Pandemic Leave Disaster Payment until 30 June 2022.

Since the start of the pandemic the Morrison Government has provided $291 billion in direct economic support to households and businesses. [my yellow highlighting]

Note

The Pandemic Leave Disaster Payment program provides financial support if you can't earn an income because you must self-isolate or quarantine, or are caring for someone with COVID-19.

Morrison Government ignores the "Pink Recession" in Budget 2020-21

 

"Women drive on roads. They will benefit from our infrastructure spend" [in Budget 2020-21]. [Senator Michaelia Cash, Channel 10 clip in The Project program, 8 October 2020]

The Guardian, 8 October 2020:

The prime minister, Scott Morrison, is angry with women. Not all of us, just those making a fuss about the woeful lack of attention to women’s workforce participation, economic security and safety in the budget his treasurer handed down on Tuesday night.

After early childhood education advocate and journalist Georgie Dent published an article in Women’s Agenda pointing out that the biggest-spending budget in history had allocated roughly a third of 1% of its funds for women’s economic security (citing a figure I tweeted from the Per Capita account during the budget presentation on Tuesday night), she received a call from the PM’s office to complain that “no one credible” was making such a complaint, and that “nothing in the budget is gendered”.

To quote one famous working woman: big mistake. Big. Huge.

Within a couple of hours, the hashtag #CredibleWomen was born, and soon trending in Australia. Twenty-four hours later, more than 1,000 very angry, and highly credible, women and men had joined the fray, including prominent journalists and commentators, business leaders, former federal politicians, economists and sociologists, and even the family members of former prime ministers, both Labor and Liberal. So much for no one credible.

As for the claim that nothing in the budget was gendered – that’s the point. Proudly declaring that no gender analysis was done on the budget reveals a disturbing ignorance of the inherent bias in our economic system, and a fundamental confusion between the concepts of equality and equity. A budget that treats everyone equally, ignoring the fact that women start from a place of significant disadvantage on almost every meaningful economic measure, simply entrenches gender inequality and, in light of the disproportionate impact of the current recession on women, actually risks sending us backwards.

The fact is, the Covid-19 pandemic and subsequent economic collapse have hit women particularly hard. While previous recessions were typified by declining aggregate demand for manufactured goods and services, the current downturn is marked by a partial or total shutdown of many service industries, which are dominated by female workers.

Social distancing restrictions have resulted in an unparalleled collapse in demand, which has had an immediate impact on sectors of the market unused to bearing the brunt of economic shocks, with widespread jobs losses in retail, entertainment and hospitality. Universities, too, are shedding jobs at an alarming rate, and many of the jobs in research, teaching and administration that have been lost will not return even if and when international students do.

As a result, unemployment for women in this Covid-induced economic collapse is double that of the 1990s recession. While women suffered roughly 25% of all job losses in the early 1990s, they account for more than 50% of the newly unemployed today.

“A budget that treats everyone equally ... simply entrenches gender inequality”

Yet the Morrison government seems to have failed to come to grips with the different nature of this recession compared to previous downturns, or to have grasped the significant changes in our labour market over the three decades since Australia last faced the task of rebuilding a shattered economy. The budget released on Tuesday night was a fine plan for recovery from the recession of the early 1990s, but not so much for the one we face today…..

The full article can be read here.

BACKGROUND

According to Australian Bureau of Statistics (ABS) Labor Force original data, in December 2019 before the COVID-19 pandemic had entered the country, the female workforce participation rate was 61.6 per cent and total number of unemployed females was 295,100 individuals.

A Parliamentary Budget Report found that 56 per cent of those unemployed females were women aged 45 years and older.

By end of August 2020 the female workforce participation rate was 59.7 per cent - a 3 per cent participation fall. While the unemployment figure had grown to 418,600 females of working force age – a 29 per cent increase in unemployment.

In December 2019 the male workforce participation rate was 71.4 per cent and the total number of unemployed males was 371,600 individuals.

Of these unemployed males 45 per cent were men aged 45 years and older.

By end of August 2020 male workforce participation rate was 69.4 per cent – a 3 per cent  participation fall. While the unemployment figure has risen to 503,000 males of working force age - a 26 per cent increase in unemployment. 

Comparing total females and males who considered themselves underemployed between December 2019 and August 2020:

• Underemployed females totalled 690,200 workers in December 2019 and 753,200 workers in August 2020 - an est. 9 per cent increase in underemployment over the 9 month period; and
• Underemployed males totalled 503,000 workers in December 2019 and 723,300 workers in August 2020 - an est. 31 per cent increase in underemployment.

Females in employment worked a combined total of 736,643,500 hours in December 2019 and a total of 702,547,200 hours in August 2020 - an est. 5 per cent fall in hours worked. 

Males in employment worked a combined total of 1,044,184,200 hours in December 2019 and a total of 980,844,400 hours in August 2020 - an est. 6 per cent fall.

When breaking that down further by looking at the percentage of females who had between 35-44 hours paid work a week it was 32.1% of all employed females, with another 19.8 per cent working less than 20 hours. While for males receiving 34-44 hours of paid work a week it was 42.1 per cent of all employed males, with another 11.1 per cent working under 20 hours a week.

Overall since the impact of the COVID-19 begun to be felt both males and females experienced swings and roundabouts when it came to employment. 

However, compared with men, over the last decade a higher proportion of unemployed women are now either older women, have a reduced capacity to work, are carers or sole parents. 

While the bottom line is that despite the JobKeeper subsidised wage program, at the end of the last 9 months there are still more females out of work than there are males in the same predicament and more employed females than males with less than a full week's work.

When it came to ABS records for industry sectors with the highest job losses year-to-year it was clear highest losses occurred in sectors with traditionally high female employment levels:

JUNE 2019 to JUNE 2020

Accommodation - jobs down 25.5 per cent

Cafes, restaurants and takeaway food services - jobs down 15.6 per cent

Clubs, pubs, taverns and bars - jobs down 15.6 per cent

Tourism - jobs down 15.1 per cent

Travel agency and information centre services - 17.9 per cent

Retail Trade - jobs down 9.0 per cent.

Tourism jobs peaked at 748,200 in December 2019 and in June 2020 were at the lowest level (611,700) since June 2014. More females work in tourism than males so there were more jobs lost by females with a reduction of 88,100 (-21.5%) jobs compared to a fall of 48,300 (-14.3%) for males.

The Australian Treasury is reportedly predicting that unemployment will remain high for several years, but that it will peak at 8% in the December quarter of 2020. However, indications are that unemployment will not fall below 5 per cent until sometime after 2024.  

It is statistics such as these which have led to political commentators dubbing the current economic recession In Australia, the "pink recession" or "shecession".

Terms with which Scott Morrison appears to take great exception. Women it seems are never to speak up on economic matters unless it is to agree with his world view.

According to Taylor Fry Consulting Actuaries' research, by 29 August 2020 in the Clarence Valley the economic impact of the COVID-19 pandemic was rated "Medium" for most of the valley but at the upper end of "High" was Maclean-Iluka-Yamba which are heavily dependent on tourism.

As it is for Byron Bay where the impact was also rated at the upper limit of "High", while the remainder of the Northern Rivers region was at the lower limit of "High" with the exception of Kyogle and Casino which were rated "Medium".

In 2019 the NSW Northern Rivers region had a resident population of est. 304,325 people with a high number of older residents. In fact at the last Census around 133,332 were aged between 50 and 100 years of age.

In 2020 the Northern New South Wales Local Health District data indicated that females made up 49.22 per cent of the regional population - with est. 30 per cent of that regional population being females of workforce age.

That's an awful lot of Northern Rivers women Scott Morrison & his Cabinet have chosen to brush aside in the worst recession in 30 years.

Australian Prime Minister Scott Morrison continues his personal war on the poor and vulnerable

"This is a deeply ideological budget. It rewards the Morrison government's friends, and punishes perceived enemies." 

[Journalist and Reseacher Ben Eltham on Twitter, 7 October 2020]

 

Council to Homeless Persons, media release, 6 October 2020:

Federal Budget reveals millions to be cut from vital homelessness services (Homelessness Australia)

Tonight’s Federal Budget has failed to include the stimulus investment in social housing urgently needed to respond to growing homelessness and includes a $41.3 million cut to homelessness services from July 2021.

Homelessness Australia Chair, Jenny Smith says, “Tonight’s budget is devastating. In a year with huge increases in unemployment creating a surge in rental stress and homelessness, the Federal Government has chosen to slash homelessness funding.

“The Treasurer had a choice to make, and he has chosen homelessness for tens of thousands of Australian families. Without increases in social housing and with even less resources for homelessness services, many families will become stuck in homelessness for a long time.

“The Government has ignored advice from all corners: from top economists, property industry and community sector leaders, as well as popular support from the community; all calling for the Government to invest in social housing to both create thousands of new jobs each year and to deliver enormous social good.

“The failure to invest in social housing growth in the 2020 Budget follows a 10 per cent cut to housing and homelessness funding over the three years from 2017-18 to 2020-21, most of which has been cut from remote Indigenous housing.

“The 2020 Budget includes a one-off payment to Queensland for remote Indigenous housing. It also includes funding for remote housing in NT, but even with these short term funds, annual funding for housing in remote Indigenous communities is $237.2, less than half the amount of $526.6 spent in 2017-18.

“Not only has the Budget ignored the opportunity to build social housing as economic stimulus, it has revealed plans to slash a further $41.3 million from vital homelessness support in July. Despite soaring demand, tonight’s budget has put services in an impossible situation.

“Homelessness services are already under enormous strain. Last year alone, services had to turn away 253 people every day because not enough housing or support was available, and cuts to services will increase the number of people in need who are turned away.

“The economic ramifications of this pandemic will continue well past 2020. Slashing $41 million in homelessness support in July is senseless and cruel,” says Jenny Smith.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Mission Australia, media release, 6 October 2020:

• Shocking failure to address rising homelessness or the serious shortage of social homes, particularly given COVID-19 impacts.

• Baffling silence on permanent increase to income support.

• Welcome investment in youth employment, yet more must be done to better support disadvantaged young people seeking work.

• Homelessness and housing

Mission Australia CEO James Toomey warned that the Commonwealth Government’s ongoing lack of investment in new social homes and absence of a national plan to end homelessness will push more people into homelessness.

"It is shocking that the Federal Budget hasn’t done enough to commit to long-term investment to address the serious shortage of social homes in Australia."

“Ensuring everyone has a safe and secure place to call home is a national responsibility that was ignored in this year’s Federal Budget.

“Prioritising ending homelessness in Australia still isn’t being taken seriously at a national level.

“This year has been incredibly challenging for Australia’s most vulnerable people, including people experiencing homelessness and poverty. We are deeply concerned that high levels of unemployment, the reduction in the COVID Supplement rate and the huge debts in rent deferrals that some people are accruing will lead to a huge spike in housing insecurity and homelessness.

"With this lack of commitment, there is a looming risk that even more people will be pushed into homelessness and unsafe living situations."

“Investing in 30,000 social homes within the next four years is an obvious solution that will not only help to end homelessness in Australia but will also create vital jobs in the construction industry.

“Despite a significant investment in infrastructure in this year’s Federal Budget to help create jobs, we are deeply disappointed the essential social infrastructure of social housing has been ignored.

“Particularly given 2020’s challenges, we cannot fathom why Australia still doesn’t have a national plan to end homelessness.

“At a time when homelessness is likely to increase, the Government has again deserted the needs of at least 116,000 people who are homeless and the thousands who are teetering on the edge of homelessness in severe rental stress during the recession.

“Ensuring everyone has a safe and secure place to call home is a national responsibility and was ignored in this year’s Federal Budget.

“Tackling the challenges of drought, bushfires, flood and a pandemic has distilled in our nation’s hearts and minds just how crucial a safe and secure home is for people to live, work, access education and stay well.

“We urgently need more social homes to help end homelessness in Australia. We cannot wait another year for these vital investments in the social homes that Australia profoundly needs.”

Adequacy of income support

Mission Australia CEO James Toomey said: “While forewarned, we are baffled there was no indication about the future of income support in a Federal Budget in which the Treasurer acknowledged how these payments had supported the economy.

“We welcome the two cash payments that were announced by the Government for aged, carer, family and disability welfare recipients, but this is not nearly enough to address the ongoing insecurity experienced by people relying on income support payments.

"We are left disappointed that the increasing number of people on JobSeeker have been ignored in the Federal Budget."

“The doubling of income support for people facing unemployment, from Newstart to the JobSeeker Payment with COVID Supplement, made an enormous difference to many Australians during the pandemic, including many that we serve at Mission Australia.

“With the JobSeeker COVID supplement recently reduced and no certainty beyond December yet provided, Mission Australia is one of many voices calling on the Government to secure a permanent floor to income support to keep people out of poverty and homelessness.

“Inadequate income support is incredibly distressing for the people we serve at Mission Australia. Without enough to cover the basics, they can be forced to make difficult decisions such as going without adequate food, missing out on life saving medicine, or being unable to afford transport to a job interview. Additionally, many can be pushed into stressful and unsafe living conditions as it’s all they can afford. All of this, coupled with the stressors of the pandemic, can enormously impact on people’s mental health and wellbeing.

“Turning back to $40 a day from 2021 would be a disaster for so many people around Australia. It is too low, and would return too many people to poverty and drive many into homelessness at a time when we should be supporting people’s wellbeing and taking steps towards recovery.

"As we move towards COVID-19 recovery, while people are seeking paid work, they need the certainty they’ll have enough money to put adequate food on the table, stay well and remain safely housed."

“With the numbers of people staring down the barrel of unemployment predicted to continue to rise, we need an urgent commitment from the Government to provide a permanent and adequate increase of income support payments.

“This would not only lift people out of poverty, but also help people to regain control of their lives, wellbeing and finances, as well as access transport and many other essential resources to seek and be ready for work.”

Youth employment

Mission Australia CEO James Toomey said: “We know that young people will be disproportionately affected by the recession caused by COVID-19, as they are trying to transition from education to work when there are fewer jobs available.

“The Government has acknowledged this reality with the measures announced in the Federal Budget.

"We welcome the announcement of wage subsidies for young people and hope that they will make a significant contribution in helping young people to engage in the labour market at a time of significant disruption for them."

“We also welcome the new wage subsidies for trainees and apprentices, but are concerned about what will happen after 12 months when the subsidy expires. We are also very concerned about many other people who are unemployed and severely impacted by the recession, especially those who have experienced unemployment for long periods and others who are disadvantaged in the labour market.

“We recognise the ongoing need for specialist youth employment assistance programs such as Transition to Work and are heartened by the Government’s investment of $21.9 million in this vital program.

"There remains a critical need for more targeted programs to help disadvantaged young people into work."

“Every young person in Australia should have every opportunity to thrive and have access to the services, supports, education and training that they need.”

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Medianet, Brotherhood of St. Laurence (BSL), media release, 6 October 2020:

TOO MANY LEFT BEHIND AS GOVERNMENT MISSES HISTORIC OPPORTUNITY

People hit the hardest by the COVID-19 pandemic will be left behind by a recession that Treasurer Josh Frydenberg labelled a “once-in-a-century shock”. The Brotherhood of St. Laurence (BSL) believes the federal government’s budget has missed an historic opportunity to bring all Australians along in the recovery from COVID-19.

While BSL was happy to see a focus on youth employment and training, the Morrison Government has offered very little support to others in need.

“This budget falls drastically short for Australians doing it tough,” says BSL Executive Director, Conny Lenneberg. “The government showed great leadership during this pandemic with initiatives like JobKeeper and the Coronavirus Supplement. But even though this crisis is far from over, the supplement has now been cut. People around the country still need help to rebuild their lives.”

“Those who are relying on income support have been given no certainty that they won’t be back on $40 a day come January, even though the government’s own predictions show unemployment will still be above 8% at the end of this calendar year. This lack of certainty means unemployed Australian parents don’t know how they’ll cover their rent and budget beyond Christmas,” said Ms Lenneberg.

“The Treasurer said in his speech that ‘This is what it means to look after one’s fellow Australian’. But millions of people are not being looked after by this budget. When we look at the most disadvantaged groups, like single mothers and their children, there is nothing in this budget that would make them feel that anyone has their back,” said Ms Lenneberg.

The Parliamentary Budget Office revealed that the number of single mothers on the former Newstart (now named JobSeeker) skyrocketed from 7.3% in 2007 to 27.4% in 2019. This will only be made worse by the recession. That’s why BSL believes this budget should have addressed the rate of social security payments.

The Coronavirus Supplement was a lifeline for millions of people, but since it was slashed at the end of September, millions have been pushed back below the poverty line.

“It is alarming that at a time when 1.6 million Australians are relying on JobSeeker to get by, the government can hand down a budget that doesn’t talk about social security,” says Ms Lenneberg.

BSL is calling for a permanent adequate increase to JobSeeker and the establishment of an independent Social Security Commission to set, monitor and review social security payment rates, much like the one that determines the rate of pay for politicians.

“It’s time to take the politics out of social security,” says Ms Lenneberg. “Making sure this country’s most disadvantaged people can get back on their feet is far too important.”

The Brotherhood of St. Laurence is a social justice organisation working to prevent and alleviate poverty across Australia.