Friday, September 25, 2020

Today by Paddy Manning

Back to poverty
‘Budget repair’ begins today, and the unemployed are paying for it

Image of Treasurer Josh Frydenberg and Finance Minister Mathias Cormann

Treasurer Josh Frydenberg and Finance Minister Mathias Cormann. Via 9 News

Yesterday, Treasurer Josh Frydenberg conceded it was no longer prudent to target a return to surplus in the next four years, saying that the forthcoming budget would recognise the need for continued “temporary, proportionate and targeted fiscal support” through the pandemic, including via JobKeeper and JobSeeker. Yet today the treasurer is persisting with a planned cut to JobSeeker’s coronavirus supplement by $300 per fortnight, literally taking food off the table for more than two million people, including a million kids. Why? There has been no explanation offered, except anecdotal evidence that the higher payment means jobseekers are refusing work. Labor has opposed today’s cut to the coronavirus supplement, along with Monday’s $300 per fortnight cut to the JobKeeper rate, saying it is too soon to withdraw support, given that Australia is in the middle of a jobs crisis with unemployment likely to increase. But Labor has not nominated its preferred permanent rate for JobSeeker, calling instead on the government to do some modelling on the economic impacts. The Greens have also called on the government to abandon the cut, which they say will condemn some 1.8 million people to live on a payment below the poverty line – even as the government fast-tracks tax cuts favouring high-income earners. 

Tax cuts for the rich and welfare cuts for the poor are entirely consistent with the track record of the Abbott–Turnbull–Morrison governments, of course. Paradoxically, the pandemic brought some temporary relief from the kind of prosperity gospel–infused attacks on the disadvantaged, with income inequality falling sharply during the pandemic, according to research from the National Centre for Social and Economic Modelling, discussed on ABC’s “The Money” podcast this week. Starting today, that respite is over and, as things stand, there will be another leg down at Christmas when the coronavirus supplement is set to be axed altogether, forcing the unemployed back onto the $40-a-day payment, which is universally regarded as woefully inadequate. 

Australian Council of Social Service chief executive Cassandra Goldie said in a statement yesterday: “There are a lot of things that are not in our control in this pandemic but one thing that the government does have control over is ensuring that everyone has enough to cover the basics of life, including a safe place to live. Not only is this the right thing to do, it’s one of the best things we can do to support business recovery and job creation, with Deloitte recently finding the government’s cuts to the coronavirus supplement would cost the national economy $31.3 billion and 145,000 jobs over the next two years. We urge the government to immediately extend the current rate, which it has the power to do outside of a Parliamentary sitting, and to announce a permanent, adequate rate of JobSeeker in the October budget.”

ACTU president Michele O’Neil called on the government to produce a national economic reconstruction plan, and noted that more than a million people who have been able to escape poverty for the first time in years thanks to the coronavirus supplement would soon see their welfare payments drop to $58 a day. “Despite not having a plan for how to get people back into jobs, the Morrison Government is now cutting support for the people in our community who have been hit hardest by this pandemic,” she said. “We need leadership from the federal government and commitment to continue the essential supports needed in this crisis and to ensure a permanent increase in payments so that they families do not tumble back below the poverty line. This cut is pulling the rug out from under unemployed workers while most of the economy is still shut and deeply damaged.”

Meanwhile, Guardian Australia calculates that one of the architects of the JobKeeper wage subsidy, billionaire retailer Solomon Lew, will receive $24 million in dividends after his Premier Investments received almost $70 million in wage subsidies during the pandemic. The treasurer announces the removal of responsible-lending obligations from the consumer credit code in a gift to the banks – whose share price rocketed today in anticipation of a free-for-all – in a move described as “a recipe for disaster” by investigative journalist Adele Ferguson. “That it eased the laws on the same day that Westpac copped the biggest fine in Australian corporate history beggars belief,” Ferguson writes. 

And the outgoing finance minister, Mathias Cormann, in a joint press conference with the treasurer, delivered the final budget outcome for 2019–20: a record deficit of $85 billion and net debt of $491 billion or 25 per cent of GDP. Cormann flagged that yesterday’s “revised approach in our fiscal strategy, should not be read as delaying budget repair”. It starts now, and we know who will be paying for it – it’s certainly not the top end of town. 

“So many vice-chancellors have been meek and quiet. I understand that they’re under pressure, but you really would think for a million bucks a year you could stand up for the students that are missing out and the staff that are losing their jobs.”

Shadow education minister Tanya Plibersek, speaking ahead of today’s release of a Senate review into the government’s proposed changes to higher education funding.

“Instead of continuing to impotently hedge, Labor must wholeheartedly embrace gas … Spewing out environmental buzzwords about the evils of fossil fuels while refusing to take a hard position just isn’t good enough.”

Daniel Walton, national secretary of the Australian Workers Union, wades into Labor’s internal climate wars.

Escape from Tony Abbott
Scott Morrison has spent the week untangling himself from Tony Abbott’s policies, on both climate change and the NBN. Today, Paul Bongiorno on new roadmaps and old problems.


The ranking of the Perich family, worth more than $2 billion, on this year’s AFR Rich List. The infrastructure department is investigating how the Perich family was able to sell land at Leppington (worth $3 million) to the federal government for almost $30 million.


“Services Australia did not apply an appropriate framework to manage cyber security risk, and did not monitor the cost of operating the system … Delays to system elements decommissioning have put at risk expected benefits of the WPIT [Welfare Payment Infrastructure Transformation] Programme. Services Australia has not yet established appropriate arrangements to migrate data to the future welfare payment system.”

The auditor-general finds that the main goal of a $1.5 billion overhaul of the welfare payment system, overseen by Government Services Minister Stuart Robert, is unlikely to be achieved due to problems decommissioning the old system.

The list

“It’s difficult to quantify just how immense – thematically, tonally and emotionally – Michaela Coel’s I May Destroy You is. As creator, lead actor and co-director, the 32-year-old Londoner has crafted a remarkable limited series that inverts your expectations through both unblinking directness and wrenching empathy.”

“There are two clear narratives on offer, and they don’t sit easily together. One suggests that Latham has changed completely, that he bears no resemblance to the man almost half the country voted for, just 15 years ago, and that his present actions are the result of some recent cleavage with his previous self. But the other – that Australia ‘dodged a bullet’ – implies that Latham was always going to end up here, more or less, and that his present behaviour is a reliable guide to his past self. So it would not have been long, if he had won, before he caused significant damage to the country.”

“One day in 2013, a young Somali woman, Awaysee (not her real name), posted a short message on her Facebook page: ‘Heart’s tendon tells a sad story that is full of optimistic silent words.’ At the time, she had no idea that this short message was the beginning of a years-long journey. Australian poet and activist Janet Galbraith responded immediately: ‘Hi, I wanted to say the two lines you wrote are beautiful, are you a poet?’ Awaysee answered: ‘If you knew you would laugh and cry.’” 

Paddy Manning

Paddy Manning is contributing editor (politics) at The Monthly and has worked for the ABC, Fairfax, Crikey and The Australian. He is the author of Body Count: How Climate Change Is Killing Us, Inside the Greens and Born To Rule: The Unauthorised Biography of Malcolm Turnbull.


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