RETURN TO THE POLITICS OF DIVISION AND DEPRIVATION?
JOHN CURTIN MEMORIAL LECTURE-1989
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Fairness, opportunity and security are fundamental to the
Labor lexicon and one of Curtin's greatest contributions was to transform
these objectives into the everyday lives of Australians.
These objectives have never been, nor will they ever be,
part of the conservatives' vocabulary or philosophy. This has never been
more abundantly clear than with the recent release of the Opposition's economic
The Opposition's plan is a prescription for the politics
of division and deprivation. It offers many thousands of Australians a future
of perpetual poverty. It ignores the needs, aspirations and security of
thousands of Australian families-those on low incomes, sole parents, Aborigines,
the unemployed, ethnic and aged Australians.
Under the guise of reform and shallow rhetoric, the conservatives
are promising to return Australia to the simple, yet divisive politics of
the Menzies era. History has shown quite clearly that the Menzies period
of Government was a sham for reform, providing benefits far less than the
rhetoric claimed and creating a society of haves and have nots.
Peacock promises a return to the same-a return to the politics
of the simplistic, the giveaway and the sham. Every Australian should compare
this to the history and achievements of Labor Governments.
The Labor tradition is one of sustainable reform, addressing
long term structural issues to build a solid basis for Australian society
by providing opportunities, fairness, equity and security for all people
no matter what their origins or circumstances.
Unlike the conservatives, Labor's program of reform does
not pass judgement on people but offers them a future. Labor does not sentence
people to a life of deprivation but offers equality of opportunity and the
resources to permanently improve their lives.
The Opposition's recently released economic action plan
is a vicious and brutal attack on Australian families.
Australian society is made up of all types of families.
But what does the Opposition actually offer to all of Australia's families?
What issues does it purport to solve? What is its analytical basis? Will
it endure the passage of time?
Let me contrast what the Hawke Government has provided
for Australian families with what the Opposition is promising.
Since 1983 more than 1.6 million jobs have been created,
65% of which have been full-time and 55% being taken up by women. Youth
unemployment has been nearly halved from its record level of around 28%
in early 1983. Women now have the highest labour force participation rate
in our history. And we are now embarking on a major process of award restructuring
which will provide more satisfying, skilled and better paid jobs.
Employment is the surest solution to poverty. Every opportunity
should be provided to ensure that every Australian has that prospect.
In 1983 nearly 270,000 children were dependent on adults
who were receiving unemployment benefits. In August 1989 that number had
been reduced to less than 170,000. The employment record of the Federal
Government has ensured a far more secure and fair future for those Australian
families and their children.
The introduction of Medicare, a massive rebuilding of our
health and community services, the creation of nearly 70,000 additional
child care places, major improvements in education and training programs-these
reforms have all been initiated in recognition of their importance to the
quality of life for all Australians, particularly those most disadvantaged.
Unprecedented reform of the taxation system to improve
its fairness, to stop tax avoidance and evasion used by the privileged,
and to provide substantial increases in take-home pay for Australian workers,
is a further example of major reform by the Federal Government for the benefit
Similarly, the spread of superannuation, supported by the
Federal Government, in combination with its recently announced retirement
income policy provides for the first time for every Australian, both now
and in the future, the basis for a decent and dignified standard of living
Perhaps one of the least acknowledged Federal Government
reforms has been the historic restructuring of family payments.
Family allowance payments have been simplified and substantially
boosted. This has directly benefited nearly two million families with over
3.8 million children.
The lowest income families have also received levels of
income support never before delivered by any Australian Government through
the introduction of the Family Allowance Supplement (FAS). FAS-or its equivalent
paid to families receiving a social security pension or benefit-provides,
on average, an additional $50 a week tax free to over 500,000 families with
over 1.2 million children.
This Federal Government has been the first in the history
of Australia to set standards for family payments for those most in need
and to pay them directly to the mother on a regular basis.
Furthermore, this Federal Government is the first to commit
itself to the indexation of family payments which means that their value
will not be eroded over time.
These historical family reforms will mean expenditure of
nearly $3.5 billion in 1989-90 compared to barely $1.7 billion when we came
Although these family reforms are significant in their
own right, their beneficial impact for Australian families is further enhanced
when considered in combination with the other major reforms of the Federal
Government to which I have referred as well as others such as those for
sole parent families.
Again for the first time, through the child support scheme,
Australian sole parent families have the guarantee now of regular financial
support from their former partner and the opportunity to re-enter the workforce
to further improve their standard of living and secure their own and their
These examples of reform clearly indicate the policy approach
of the Federal Government to Australian families-sustainable policies that
do not treat all families as the same but explicitly recognise that different
families need different things-and that needs change at different stages
of our lives. Our policies are based on solid research and analysis. They
will not be eroded over time nor be subjected to the whim of an annual budgetary
It is also a policy approach which has made one important
fact clearer than ever-social security payments alone will not solve the
problems faced by many low income families.
Australian family living standards are influenced by three
elements-wages, taxes and social security payments. The Federal Government
has restructured social policy to become an integral part of economic wages
and taxation policies and hence, provide significant improvement for those
families least well off.
The reforms announced as part of the April 1989 economic
statement unashamedly show the Federal Government's commitment to the central
role of family payments to maintain equity in the tax system, to counter
a wages structure that takes no account of family responsibilities, and
to redistribute to women who have major responsibility for children.
Any Government that attempted to overturn this policy approach
for gender equity would ignore and repudiate 48 years of support by women
for this program.
This policy approach also clearly indicates that not one
policy or program can singularly redress inequity, increase fairness or
Social policy reform, in conjunction with education and
labour market programs, continued job growth and major improvements in health
and community services have all combined to raise the quality of life for
Our policy approach has set in place a structure which
reflects the contemporary needs of all Australian families, their future
needs and will ensure that they will not be placed in the precarious position
of the past under conservative governments.
The Opposition is offering to blatantly destroy all of
this-to return to the dark ages of conservative rule when change was purely
for political expediency, directed to help those most powerful at the expense
of those most in need.
No one questions additional expenditure on families, either
through the tax or the social security system. The Government has chosen
to follow Fraser in putting the bulk of its transfers to families on the
outlay side, despite our overall emphasis on expenditure restraint. (We
have now achieved ongoing savings in social security of more than $5 billion).
The issue is simply whether an additional transfer can
be paid for and how effectively the money would be deployed.
We have overhauled the Family Allowance System to remove
its complexity and the lack of indexation. We moved in July to the two-rate
structure of $9 and $12 and, having completed the reform of the Family Allowance
Supplement for low income families, moved to pay the allowances fortnightly
and index the payment according to the Consumer Price Index.
The fact of the matter is that the reintroduction of a
Child Tax Rebate will not be available to the mother when she needs the
cash most. Indeed, we know from our research that often the mother never
sees the benefit of tax rebates.
The key issue is how you pay for family transfer improvements.
In the Government's case, we have an established record of reducing dependency,
including massive improvements in the situation of the poorest women, that
is sole parents-30% declared income in 1983, 60% do now-with more sole parents
participating in the workforce than ever before.
with Opposition Policies
The Opposition speaks of hard decisions yet takes from
the weak whose dependency it fails to address.
It prefers to cast the stigma of fraud over beneficiaries
as a substitute for carefully thought out policy. It fails to state a policy
on the indexation of its proposed Child Tax Rebate and thus opens to question
its policy on the indexation of Family Allowance and Family Allowance Supplement.
The prospect is clear-as the Opposition seeks further expenditure
cuts, as it has promised to do, it will wind back the Government's reforms
of Family Allowance and Family Allowance Supplement.
Like every other conservative proposal there is no commitment
to indexation, there is no guarantee to maintain its value. That's the real
sham of their so-called reform-offer it now with glossy rhetoric but for
how long will it be of any value to those who would actually receive it?
It must be remembered that not all families would receive
the proposed tax rebate-especially those 20% of families who don't pay tax
and who happen to be those most in need.
The Opposition's proposal is a reversal of their attitude
in 1976 when they converted the Child Tax Rebate system to one of Family
Allowances. At that time they reduced the value of the rebate to pay Family
Allowance to those families who didn't pay tax-the current proposal is the
exact reverse. Low income families won't receive the rebate. High income
In essence the prime motive of the conservatives is to
substitute politics for policy-proposing superficially attractive ideas
of no benefit to the majority or those most in need.
Sadly there is no easier target than the unemployed, no
more simplistic idea than suggesting that someone's unemployment benefit
be terminated after a period of time-any period of time-say nine months.
Such a suggestion is totally devoid of any notion of fairness
or equity. It also makes no attempt to grapple with the debilitating and
scarring effects of unemployment or offer any hope for a future beyond some
sort of scrapheap.
This Government has adopted a totally different approach
to income support for the unemployed-an approach which links labour market
programs and education and training opportunities with income support.
The primary objective of this approach has been to create
a more active system of income support which provides incentives and opportunities
for unemployed people to enter employment and reduce their dependence on
This has been balanced by the need to maintain adequacy
and equity for the most needy. At the same time the Government has continually
sought to improve the administrative efficiency and integrity of the unemployment
benefit system, as well as to reduce fraud and abuse.
Increased emphasis has been placed on review processes
and more effective work test arrangements, including closer links between
the Commonwealth Employment Service and the Department of Social Security.
Incentives for unemployed people to take on part-time or
casual work, to move into full-time employment and to participate in training
have also been introduced, along with specific programs such as Newstart
and Jet which tackle the labour market barriers for the most disadvantaged-the
long-term unemployed and sole parents.
This approach is already showing a major impact on the
number of long-term unemployed. In 1986 244,000 had been unemployed for
more than 12 months. By May 1989 this number had fallen to 172,000.
In 1984 the total number of people receiving unemployment
benefits peaked at around 670,000. As of Friday this number had fallen to
363,000-a massive drop in anyone's terms.
Our approach is about making checks more regular but tailoring
assistance to the specific needs of the individual. The long-term unemployed
are not just numbers to be rubbed out of the system using the convenient
device of any arbitrary cut-off point. The long-term unemployed are people
within our community. One in four are over the age of 45. One in five have
dependent children-90,000 children in total. Forty per cent are married.
The Opposition's proposal is the exact antithesis of our
approach. Rather than suggesting further reform of the unemployment benefit
system and even greater linkages to the labour market, the Opposition propose
the poverty trap of special benefit-a payment which is simply not designed
to support people through the transition to part-time employment or training
programs. Special benefit is not work-tested and is intended to provide
emergency assistance for relatively short periods.
Their proposal is not based on any analysis or understanding
of the needs of the unemployed. Instead, the Opposition intend to quadruple
the numbers on special benefit which will lead to total expenditure on this
payment increasing from its current level of $225 million a year to well
over $1 billion a year.
This proposal by the Opposition compares with their previous
approach when they were last in Government. At that time the conservatives
removed all the controls and checks from the Unemployment Benefit system,
including the work test which proves that people are genuinely looking for
work. The result-a massive blowout in expenditure on unemployment benefits.
This time they propose a massive blowout in expenditure on special benefit.
Previously, the Opposition spokesperson for Social Security
has called for easing of social security income tests to encourage people
to maintain their attachment to the labour market. Last week's Opposition
document is explicitly suggesting tougher income testing and hence exclusion
from the mainstream of society for thousands of people and their families.
While looking for a tougher approach, the conservatives-because
of total lack of understanding and policy analysis-have chosen to substitute
a payment which is discretionary and not work-tested. In effect this multiplies
the number of hard decisions to be made by Departmental staff who must use
their discretion. This would be an extremely labour intensive process requiring
a massive increase in staff. It is a strange route to go when the Opposition
is intending to cut the Public Service.
What this means is that the conservatives are labelling
thousands of people as unemployable, deserving of no attention or assistance,
marginalised with no hope or opportunity for their own or their children's
The conservatives claim a compassionate approach. Is it
compassionate to relegate thousands of Australians to the vicious cycle
What would be the prospects for a 45 year old worker who
loses his job after 20 years with the same company? The Opposition proposes
that this person uses up all annual and long service leave entitlements
before becoming eligible for unemployment benefit. It may therefore be six
months, or more, before he is eligible. Then it would take at least three
weeks before he would receive his first payment. After nine months without
any assistance to re-enter the labour market he is then labelled by the
Opposition as a bludger. If he has any savings left he will not be eligible
for special benefit. His retirement savings will be eaten away before the
normal retirement age. Hence no prospects of a higher age pension under
the conservatives' proposed age pensioner bonus plan.
Harsher prospects are faced by those who are sick or who
have a disability. About 24,000 invalid pensioners each year are to be accused
of fraud and removed from payment, apparently on the assumption that people
have been misrepresenting their circumstances. No provision is made under
the Opposition's proposal to provide any other form of income support should
they lose this payment.
Contrast this with the Government's approach of careful
review, analysis and development of programs that will allow people with
disabilities to take an active part in the life of their community. Fundamental
to the Government's approach is the belief that it is vital for people with
disabilities to be provided with the incentives and opportunities to develop
their individual skills and potential.
The promises of the Opposition for families amount to little
more than a list phrased to appeal in the most simplistic terms. They are
promises created in a policy vacuum which will not benefit all Australian
families, particularly those most in need.
And how are they proposing to finance these promises? By
fingering the poorest of our community, calling them bludgers and cheats
and smugly handing over the income entitlements of the poorest to boost
the situation of the wealthiest.
It is unemployed families and the disabled who will pay
for the children of the high income earners-that is the conservative definition
of social justice. Who will pay for the children of the unemployed and the
disabled? For the Opposition, the children of families most in need are
For a time both John Howard and Andrew Peacock (twice)
talked about fairness and opportunity; even social justice gets a footnote
in Future Directions. They both feigned a belief in policy.
Last week's policy document blows any such pretensions.
The discipline of policy and sustainable reform is to be ignored and only
the political calculus is to be relevant. There is nothing about making
a fair go for all a reality and redressing inequalities in Australian
In stark contrast to the conservatives the Federal Labor
Government maintains a firm belief that all Australians are entitled to
genuine equality of treatment and opportunity in all spheres of life. That
is the social justice approach of a Labor Government. Its record since 1983
Social justice is about being fair, about providing opportunities,
about increasing equity and about providing security. It is about sustained
social progress concurrent with economic progress. It is about building
consensus in the community for long-term change. Social justice is also
about tackling the issues which confront the community without dividing
it and opening it up to large scale confrontation.
John Curtin set the social justice standards for future
Labor governments. Chifley followed in that tradition and the Whitlam Government
provided a more contemporary dimension to the implementation of Labor goals
and objectives. The Hawke Government during the last six and a half years
has clearly demonstrated further expression of the standards set by Curtin.
Its reforms are enduring and shaped to redress the legacy of inequity which
it inherited and to confront the challenges of Australia in the 1980s and