Over the past few weeks you’ve probably heard a lot about the federal government’s budget. Why do we care and what does it mean for Pelican readers?
The budget is a statement of the government’s values and intended policy over the next financial year. Since we can expect an election in the next twelve months, this is particularly important. This budget goes against what we would typically expect from a Coalition government; that is, tax cuts and cuts to spending. Instead, this year, we’ve seen increased spending, with the government also retaining their tax cut policy from the last election. You might wonder how the government is managing to increase their spending whilst decreasing their revenue. The answer is record amounts of government debt.
So, why might the government be changing tune? The treasurer has been firm that the past two budgets have reflected the crisis created by the pandemic. Any first-year economics student can cite John Maynard Keynes’ famous philosophy on increasing public spending through a crisis. It was also this approach that allowed Australia to get out of the GFC relatively unscathed in comparison to other countries. Another important context to this budget I already mentioned is the upcoming election. Reducing their vulnerabilities and having a little something for everyone certainly won’t hurt them at the polls.
Since the budget is such a huge document, I’m going to touch on a few key issues and how the government fared this year.
Universities will receive $19 billion in funding over the next year according to Josh Frydenberg. Such a large number might sound impressive – but it’s actually less than we should expect. In the 2019/20 budget, universities received $17.7 billion in funding. Due to the reduction in international students, universities lost $1.8 billion last year and are expected to lose $2 billion this year. This is on the assumption that international borders won’t open until next year – which is important given that international students comprise a significant amount of university revenue. Some quick math shows that $19 billion does not equate to a net increase in university revenue.
However, it’s not all doom and gloom. The government has invested $1.1 million in incentives over the next two years for universities to enrol students in ‘industry PhDs’. These courses allow students to work with industry while conducting their academic research.
Over the past few months, the government has fumbled with women’s issues as a series of allegations around government MPs have come out. With this in mind, it’s no surprise that there’s been somewhat of an emphasis on women. A Women’s Budget Statement sits with the other four budget papers. Although this isn’t the first time a government has included such a statement, it’s refreshing to see it back in the mix.
The government has allocated $3.4 billion in measures to support women. Half of this is towards child care, which isn’t necessarily just a women’s issue. Although child care disproportionately affects women’s workforce participation, making child are the cornerstone of a woman’s budget statement might indicate the government has an old-fashioned framework when it comes to viewing women’s role in society.
In terms of women’s safety, the government has allocated $998.1 million over four years for preventative measures and to support victims of family, domestic, and sexual violence. Whilst many organisations are happy with this support, it hasn’t come without criticism. Some experts argue that $1 billion every year is required for the frontline measures. With an issue as serious and life threatening as domestic violence, I would rather err on the side of caution and have an excess of funding than fall short.
Women’s health funding also got a boost this year with $148 million over five years being spent towards women’s health care services.
By and large, this funding is a step in the right direction. However there is still a way to go, especially when we start to think about structural problems and the changes these require.
The pandemic has been a catalyst for mental health issues, so it’s good to see the government has increased mental health funding. The funding in this budget for mental health and suicide prevention sits at $2.3 billion over 4 years. To put this in perspective, experts in September recommended that $3.76 billion over 4 years should be spent on mental health.
One of the measures is aftercare for anyone being discharged from hospital after a suicide attempt, as well as a trial of these services for those who were not admitted to hospital. This is an important program to have, however coordination between the state and federal governments will be crucial, since hospitals are controlled by the states.
Another part of the funding break-down is $278.6 million being spent on Headspace over four years. Roxxanne MacDonald, a spokesperson for the Youth Health Forum remarked:
“We know that Headspace is a great doorway to mental health care, but it’s only meeting the needs of a handful of young people, with many of the most vulnerable falling through the gaps”
Again, funding for mental health is moving in the right direction, but consistent funding across different forms and levels of mental health services is going to be necessary going forward.
The government has been heavily criticised for its environmental policy and actions on climate change. Before the budget, the UN listed Australia as the worst performer on ‘green recovery’ across the world’s fifty largest economies. So let’s see what the government has done to try and turn around this poor image.
There is a distinct lack of funding for renewable energy in the budget with the government opting instead for a ‘gas fired recovery’. The government is providing $58.6 million over four years to support the gas-fire industry, which is somewhat contentious since this can only be used as an emissions reduction approach rather than clean energy, of which there are many cheap alternatives. There are also concerns around methane gas being leaked during the production of the hydrogen gas. This means that emissions from these gas-fired power stations can be much higher than they are often reported.
However, the government has been praised for its $100 million Oceans Protection Package which will help protect our marine ecosystems. Hopefully we’ll see some happy pelicans soon enough! The package also creates new Indigenous Protected Areas which incorporate more sea country.
I suspect a lot of you are frustrated by the lack of action on climate change. Unfortunately this is an issue which has been over-politicised, and where industry lobbyists have been very successful.
My Final Thoughts
Overall, I think this is a budget that could’ve done better by young people, but at the same time could’ve done so much worse. I’m happy to see the government is putting some funding in critical areas which have previously suffered from a lack of funding. Hopefully, these are the first steps towards more substantial changes. However, I worry that some of the splashes of money are a pre-election attempt by the government to patch up areas of weakness, after a term in power plagued by fumbling on important issues.
Linda Pickering won’t stop until she’s been to every cafe in the Perth metropolitan area.
Words by Linda Pickering
Declaration: Linda Pickering is a member of WA Labor.