Our take on the Federal Budget 23-24
The 2023-2024 Federal Budget, delivered by Treasurer Jim Chalmers on May 9th, 2023, arrives in an era when inflation outpaces wage growth. Labor’s Budget aims to strike a delicate balance in avoiding actions that could further fuel inflationary pressures while providing targeted relief from the rising cost of living (The Conversation). At Blessing Bags, we work in collaboration with organisations including crisis centres and community groups, distributing hygiene packs to individuals facing homelessness and disadvantage. We also advocate for compassionate, evidence-based housing and homelessness policies in Victoria. Consequently, we have a vested interest in the government's fiscal decisions and our analysis of the latest Federal Budget is influenced by our outreach and advocacy work.
In assessing the Budget, we aim to direct attention toward our key areas of interest such as cost-of-living support, housing, homelessness, welfare, and community services. We acknowledge several positive developments that aim to alleviate the burden of increasing living costs on low-income Australians. However, we stress the importance of additional support in specific areas that are likely to benefit the most disadvantaged individuals.
Energy Bill Relief:
Millions of Australians will receive between $175 and $500 in energy bill relief payments, with the amount received dependent on state or territory of residence (Yahoo). Recipients of government support payments, pensioners, concession card holders, and veterans will be eligible for the payments (ABC). As a major and increasing burden for low-income households, we are happy to see some targeted energy bill relief in the Budget. We know that difficulty in balancing paying for rising housing costs and other essentials like energy bills can leave people especially vulnerable to homelessness (CHP).
Changes to Bulk-Billing and the PBS:
Higher incentives will be offered to GPs to bulk-bill around 11.6 million eligible Australians (pensioners, children under 16, and other concession card holders) (ABC). GPs will get a $20.65 bonus in the city and a $39.65 bonus in rural areas if they bulk-bill appointments (SMH). The government will also set up eight Medicare Urgent Care Clinics that will bulk-bill and provide urgent care to patients for longer hours than most GP clinics (ABC). More medications will also be added to the pharmaceutical benefits scheme (PBS) and changes in prescription rules will help patients save money by allowing them to get two months’ worth of some prescription medications on one script (ABC). We hope that these incentives stem the tide of decline in bulk-billing rates and help ensure low-income Australians get the medical care they need.
JobSeeker, Austudy, and Youth Allowance Payments:
These payments will be raised by $40 a fortnight for all recipients (ABC). Over 55s receiving JobSeeker payments will now receive the higher rate for older people that previously was restricted to recipients over 60 (ABC). People in receipt of JobSeeker payments aged 55 to 59 will now receive an additional $92.10 per fortnight (ABC). While an increase in these payments is welcome, the government’s own Economic Inclusion Advisory Committee recommended an additional fortnightly $256 (The Conversation). At $2.85 a day (SBS), the JobSeeker increase won’t stretch very far for Australians living on payments that put them firmly below the poverty line (ACOSS).
Single Parenting Payment:
The rules for receiving the single parenting payment will be changed, lifting the youngest dependent child’s age threshold from 8 to 14 (ABC). Single parents whose youngest child is between 8-14 will receive an additional $176.90 a fortnight if they are on the base rate of pay (ABC). According to the ABC, ‘the lift will benefit about 57,000 parents, overwhelmingly women, at a cost of $1.9 billion over four years’ (ABC). Research in the UK has shown that homelessness disproportionately affects single mothers (The Guardian), and we hope receipt of the single parenting payment will alleviate some of the financial pressures on this cohort of 57,000 parents. However, according to the Poverty and Inequality Partnership led by ACOSS and UNSW Sydney, 72% of people receiving the parenting payment live in poverty (ACOSS). Increased eligibility for the single parenting payment will not go far enough in addressing the fact that people in households relying on parenting payments are currently below the poverty line by $246 per week (ACOSS). Living below the poverty line significantly heightens the likelihood of experiencing homelessness as individuals and families struggle to afford adequate housing and meet their basic needs (University of Melbourne).
Commonwealth Rent Assistance:
The maximum rate of Commonwealth Rent Assistance will be lifted by 15%, the biggest increase in 30 years (AFR). Again, while this is a welcome development, we question the sufficiency of this measure to tackle the increasing levels of housing stress experienced by Australians (defined as spending more than 30% of one’s income on housing) (Broker News). Anglicare Australia has claimed that Commonwealth Rent Assistance is ‘not fit for purpose’ and that despite increased spending, it is not having an effect on housing affordability (The Guardian). An Anglicare Report delves deeper into the structural issues embedded in the CRA scheme that ends up leaving 1 in 2 of its participants in rental stress (Anglicare).
National Housing and Homelessness Agreement:
The National Housing and Homelessness Agreement will receive an additional $67.5 million in funding this year (ABC). To receive funds, ‘state and territory governments are required to have publicly available housing and homelessness strategies and contribute to improved data collection and reporting’ (DSS). The strategies must address the NHHA priority cohorts, which are women and children affected by family and domestic violence, children and young people, Indigenous Australians, people experiencing repeat homelessness, people exiting from care or institutions into homelessness, and older people (DSS). However, a 2022 report by the Productivity Commission, found that the scheme was ‘ineffective’ and recommended targeted measures to improve the affordability of the private rental market (PC).
Housing in Indigenous Communities:
The federal government has earmarked $410 million to build more housing in remote communities in the Northern Territory to address overcrowding, as well as housing projects in Wreck Bay Village and Jervis Bay (ABC). Oxfam Australia has critiqued the government for allocating only $20.8 million to address the decline of Aboriginal Hostels Limited, a not-for-profit that provides temporary emergency accommodation and social services for Indigenous Australians (City Hub Sydney).
According to the ABC, ‘Mental health, disability, domestic violence and homelessness services will receive $4 billion in additional funding in the coming four years’ (ABC) in order to support community services through increasing staff and service delivery costs (Mirage News). Blessing Bags welcomes the additional funding for vital services at the frontline of the cost-of-living crisis.
In conclusion, Labor’s Budget takes steps in the right direction, but we urge further support for low-income Australians and the services that support them in this challenging economic climate. Homelessness is on the rise in Australia (The Saturday Paper) and ineffective schemes like the National Housing and Homelessness Agreement will not go far enough to ensure housing affordability for individuals and families who are increasingly priced out of the private rental market. As Kate Colvin, CEO of Homelessness Australia, noted, “While the Budget includes a financial surplus, it has left a social deficit of unresolved homelessness that will create hardship for families and financial costs to the community in future years” (The Property Tribune). Blessing Bags hopes to see the Labor government take much larger steps toward ending homelessness in next year’s Federal Budget.