Extract from an article byAssociate Professor, Curtin Law School and Curtin Business School, Curtin University.
The 2017 federal budget was pitched as a fair budget, but much depends on your definition of fairness. Reviewing the policies through a gender lens, there is little to address the entrenched economic disadvantage experienced by women.
Australia was known for being a pioneer of policies that are sensitive to the impacts on different genders, but that 30-year history came to an end in 2014 when the Abbott government announced it was abandoning the practice. Rather than see this analysis disappear, the National Foundation for Australian Women (NFAW) stepped in and partnered with academics like us, to analyse the budget through the gender lens. We review the effect that each announced policy will have on women’s lives: their economic status and well-being.
We found there were no measures designed to specifically address gender inequality and the related women’s entrenched financial vulnerability.
It’s a relief that the government has abandoned the so-called “zombie measures” which included changes to the family tax benefit and paid parental leave measures. These measures would have had a direct impact on women by adding to the effective marginal tax rate. They would also have reduced the female workforce participation rate, having a long-term effect on the economic well-being of women and their families.
However the budget still includes measures that have a disincentive effect in the workforce. The increase in the Medicare levy will affect those on incomes greater than A$21,644. For those with eligible children, the Family Tax Benefit A payment rates are frozen for two years and those who pay child care fees receive will continue to face high effective marginal tax rates (EMTR’s).
A flat increase in taxes or levies will particularly impact low income earners. Women are overrepresented in the lowest income levels, so changes to government benefits and increases in taxes have a disproportionate affect on women. Recently released ATO statistics show the median income for women was A$47,125 in 2014/15, while for men the amount was A$61,711.
And the recent reduction in penalty rates has already been identified as disproportionately affecting women.
These changes hit those earning well below the average wage, and are particularly harsh for women. Combined, these changes could lead to effective marginal tax rates of possibly 100% or higher for some women, particularly as Family Tax Benefit Part A begins to decrease at A$51,903.
The long awaited housing package will have some benefits for women. But community organisations will need to be vigilant in ensuring that the new National Housing and Homelessness Agreement ensures that funding is guaranteed for the homeless and for women fleeing domestic violence.
There has already been criticism of initiative to encourage older Australians to downsize their homes, but when a gender lens is applied, the inherent bias becomes clear. Economic patterns established during a woman’s pre-retirement years mean that women are more likely to be in receipt of the age pension, and are more likely to be receiving the full age pension. They are also less likely to have superannuation, and the balance will be lower.
Where a person is in receipt of the age pension, the downsizing initiative will reduce it, so single women are more likely to lose entitlements if they access this benefit. For example, a widow maintaining a home that is bigger than she now needs, will not be able to benefit from downsizing with this policy.
SOURCE: Hodgson, Helen. “With its 2017 Budget the Government is Still Discouraging Women.” The Conversation, 19 May 2017
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