The Politics of WelfarePosted: January 7, 2013
With all this talk about Jenny Macklin and her comments about living on Newstart, it is time that we talked about what might be in store for our country should Abbott become Prime Minister. Here is the latest guest post from my mum, Kay Rollison.
The mainstream media, almost without exception, accept that Tony Abbott will win the election due this year. But they are not telling us what we might expect from an Abbott government, and nor is Abbott. So we can only speculate. What we come up with might not be what Abbott and his media friends will tell us when the opposition get round to making election promises, but it’s what will likely drive a LNP government – because it always does.
First some caveats. What an Abbott government can get will depend partly on the politics of the Senate, unless they have a majority there, which seems unlikely. The Howard government was a big spender and Abbott’s view of the economy – in so far as he has one – seems to owe more to Howard practices than to the economic rationalism favoured by his party. Maybe his mentor B.A. Santamaria also influenced his thinking. Or maybe he just has no idea. Don’t expect economic consistency.
The LNP, at least in theory, supports small government, with low taxation and balanced budgets. Not only are they happy to cut government spending, they will have no choice but to cut government spending if they aren’t going to increase taxation. One area they are likely to target is welfare. They have a track record on this – see the 2006 Welfare to Work changes. It is also what other conservative governments such as David Cameron’s British Tories are doing. When they have no new ideas of their own, they copy their mates. What do you think Abbott was doing in London in December –aside from hiding out from the Ashby judgement? And we have some comments from the Shadow Treasurer Joe Hockey which show support for welfare ‘reform’: his ‘end of the age of entitlement’ speech in London in April 2012, and this tweet in support of Cameron’s proposed changes.
Before we get on to what those changes entail, it’s important to remember that the deregulation of the Australian economy, which is supported by both sides of politics, involves a hands-off approach by government, which is left with only crude tools like unemployment to keep down inflation. Both sides also accept that deregulation means there would be losers and that there must be a ‘safety net’ to support them.
So what’s the difference on welfare between Labor and the LNP? Well at the moment, not very much. But there will be large differences if we go down the British Conservative path – as I have no doubt Abbott will do. We already have his statement from the 2010 election campaign that he would like to see dole payments stopped to able bodied people under 30.
The British Conservatives are singing from the same songbook as Hockey did in his ‘end of the age of entitlement’ speech. At the time, we sneered at what Hockey said, because just then, the LNP were busy opposing the Labor government’s attempt to strip back an outrageous piece of Howard era middle class welfare – subsidies for private health cover for the rich. And then there is Abbott’s ridiculous paid parental leave scheme which would pay the wages of well off women taking maternity leave. It seems the Liberals think the middle class are entitled to government support.
But this isn’t about middle class welfare. What David Cameron has in the gun is what he calls the culture of welfare dependency. Cameron is back on the old furphy we have seen so much of in years past – the unemployed are dole bludgers, who need to be forced to find a job. It’s the ‘strivers versus the skivers’. The Conservatives are offering voters a choice between spending public money on ‘hardworking families’ or ‘people who won’t work’. Sound familiar? The main proposal is to cap the amount of welfare a family can receive to ensure that it is less than the average earnings of working households. They also intend to institute tougher tests for disability support. You can read more about it here. The Conservative government expects to save billions of pounds by this – and you can’t do that without hurting the most vulnerable members of society – the very ones the safety net is supposed to support. The sad part is that Britain has an average unemployment rate of 7.9%, and the rate is much higher in some regions. Where are the unemployed supposed to find a job –given that the Thatcher government destroyed the British manufacturing industry and no one since has found a source of jobs to replace it?
The Howard ‘reforms’ assumed that the unemployed, some people on disability pensions and single parents with children over the age of eight could find part time work if their benefits were cut. Abbott will follow Cameron further down the ‘work not welfare’ road. There’s his ‘green army’ for a start. But we know that much part-time employment is casual, poorly paid and has poor working conditions. Tough luck, as far as the Liberals are concerned. And there is no guarantee that even part-time work will be available. So it will mean more futile job applications, more breaching, more misery.
So, under the Liberals, we would have an even more draconian approach to welfare than the one we have now. Everything about the British approach fits with what we know of the Liberals. Remember the Paxtons? I can just see what the LNP election spiel will be like. And will they ensure that government stimulus increases the number of jobs? I don’t think so.
Labor has a real chance to differentiate itself on welfare. It is true that they accept the safety net argument, and treat a level of 5% unemployment as normal, and even desirable to curb inflation. It’s true that they are starting to bring out ‘dignity of labour’ card, as if being in work was a virtue, and being unemployed a moral failure. On the other hand, it is reasonable to be concerned about welfare dependency, and children growing up in jobless households. If you want to generate and sustain a permanent under-class, that is the way to do it.
Merely abstaining from bashing the unemployed would differentiate Labor from the LNP. Labor is looking to increase the Newstart allowance, acknowledging unemployed people need proper support. But they could go further, with a whole of government approach to poverty. This would include better health and education for poor people, better access to vocational training, and perhaps most importantly, better pay and conditions for part-time work and a decent minimum wage. People should not be condemned to stay in the welfare system because they have no other alternative. Let’s cut back on some of that middle class welfare to fund a fairer society.
Labor needs all the support and encouragement we can give it to take the road that is socially responsible, and ultimately better economics. After all, look where austerity is getting the UK.