Budget 2017: ESSA Writers React
During last year’s election campaign, Malcolm Turnbull made a habit of using the words ‘agile’ and ‘nimble’ wherever possible to describe the future of the Australian economy. It’s now clear that these words also apply to his government. Scott Morrison’s Budget has nimbly and agilely snuck into Labor’s traditional territory and stolen its thunder (to mix metaphors). More money for schools and healthcare, plus populist attacks on big banks and multinationals, makes this sound more like a Budget that would be handed down by Shadow Treasurer Chris Bowen.
However, Budgets giveth and Budgets taketh away. Higher education funding is being cut by $2.8 billion, while students who are already struggling with cost of living and welfare cuts will now have to pay more of the costs of their education. Welfare recipients face the prospect of being subjected to drug testing in order to receive their payments. it is disappointing to see foreign aid facing a cut to the tune of $300 million over the next four years, and that nary a mention of climate change was present in the Treasurer’s speech.
“Fairness, security and opportunity”
This year’s budget was built, according to Treasurer Scott Morrison, on “fairness, security and opportunity.” In many ways, it is an insight into centre-right welfare policy. The good new is that it’s not non-existent, including a 0.5% increase in the Medicare levy and the rebate freeze lifted. Welfare policy which focuses on a minimum living standard is what we would expect from this government. There is a high focus on infrastructure including a new airport in Sydney which is destined to have $5.3 billion invested in it and a total of $75 billion invested over the next four years aimed at generating jobs as a source of growth. According to the treasurer the “best form of welfare is a job.”
To us tertiary students this approach seems misdirected, when combined with such rigorous cuts to tertiary funding ($2.8 billion over the next four years). The challenges of automation can only be dealt better through a more skilled workforce, and yet tertiary education will become that much more unattainable due to reforms to HECS.
This is combined with the introduction of drug testing for welfare claimants, and harsher conditions on the dole. Since the Treasurer’s speech this may have been the most contentious issue in the media. Means-based welfare has long had a prominent place in Australian social policy, but we must question if we truly think this is how welfare policy ought to be run. Does such vigorous means-testing help individuals escape the cycle of poverty, or does it push them further into it? While we would not expect this government to deliver universally administered welfare, it is doubtful whether all the policies presented in this budget do indeed uphold the values of fairness, security and opportunity which it claims to.
Reading this Budget, an anecdote comes to mind. While listening to a panel of experts discussing which generation deserves to feel economically entitled the most, run by the Grattan Institute, one of the speakers said“I actually used to be Scott Morrison’s lecturer. I’m sorry. He was actually a great student though! He did very well in class!”
I must say that with this budget, I can now see how that anecdote could’ve been true. The new superannuation plan for first home buyers to combat the housing crisis, red tape reduction on small business to encourage investment are welcome. I am particularly happy that the Treasury has finally, after years and years, taken the RBA’s advice and dedicated $75 billion on infrastructure through projects such as the construction of a second Sydney airport and several other rail projects.
Furthermore, the levies on fraudsters, those who still still trust the word of a former Playboy model over the overwhelming majority of the medical community about vaccination, etc., are for the most are logical (Although the entitled millennial part of me that pines for a banana smoothie still cries at the 0.5 cents/kilogram levy on bananas).However, this budget is not without its major flaws and question marks. It is important to observe what is not meant to be observed: the lack of discussion on the cuts to foreign aid, which has plummeted to a historic low of 0.22% of GNI and tertiary education. These pale in comparison, however to the disappointment that is the absence of any information about research and development, especially in renewable energy.
Perhaps most significantly however, a projected $7.4 billion surplus projection by 2021 seems a tad optimistic, given the failures of ghosts of Budgets and Broken Promises Past. I would not wait for a balanced budget with baited breath, given that the budget also takes it as a given that big banks breaching guidelines and people missing welfare appointments will help make up the deficit. All that being said, for a man who almost lost Australia its AAA rating, I am still pleasantly surprised overall.
Neala Guo, on schools funding:
Amidst rising global standards in literacy and numeracy, Australia has struggled to remain afloat. According to the Gonski Review, under-resourced schools are to blame.
Naturally, the Gonski model boasts a type of funding system that, if successful, will bring about smaller class sizes (an aspect that has been attributed to excellent academic results in Sweden and Denmark), increased public school funding, greater assistance to students with disabilities and behavioural issues, and not-too-unreasonable cuts to elite private and Catholic schools.
However, concerns regarding the burden increased school tuition may place on single-income families may be unfounded, according to Nick Grenier, writing in The Australian, who claims that fees would only rise by at most 1.5% (about an extra $4.50 per week). This funding system, which has been in effect since 2014, has seen positive results in schools that have been under-resourced in the past.
This year’s post-election-year budget was, surprisingly, Labor-lite. In his first interview after his speech, ABC host Leigh Sales asked pointedly, “Could you be the first Liberal Treasurer in history to deliver a Labor budget?”
Witty quips aside, the government’s optimistic projection of the Budget returning to balance in 2020-21 (and remaining in surplus over the medium term), is pretty optimistic from a quick perusal of the budget, considering how many increased expenditures have been projected.
One big winner is clearly infrastructure – there is projected to be $75 billion in infrastructure funding and financing over the next ten years. Just to name a few specific projects, there will be $5.3 billion going to the Western Sydney Airport over the next four years, an unspecified amount set aside for Snowy 2.0 and $1.6bn on Western Australian roads and railways to connect regional areas. The Turnbull government is clearly taking to task the cries for growth and job creation, with the Western Sydney Airport alone expecting to provide over 60,000 jobs in the longer term.
There was disappointingly a very quick one line gloss over new emissions technology, considering this is an area in which we could really afford to develop more in. But then again, this wasn’t the worst budget we could’ve gotten. Unless you’re a uni student with increasing fees and you really like your Seven Seeds smashed avo on toasted multigrain — then you’re all out of luck.