Here's The Table That Shows How The Budget Hits People On Different Incomes -- And It's Clear The Rich Come Out On Top

Treasurer Joe Hockey (Photo: Getty Images)

Treasurer Joe Hockey left an important table out of the federal budget revealed last week.

And according to two public policy experts from the Australian National University, it shows low-income families receiving benefits will suffer far more than richer Australians, who could experience a very minimal impact.

In fact, Fairfax’s report on the research says a single parent on the parenting payment welfare scheme with one child aged six will be 10.2% worse off in terms of income.

In contrast, someone earning three times the average wage will lose 0.9% of their pay.

This flies in the face of the treasurer’s claim that “everyone is being asked to make a contribution”

According to Peter Martin from Fairfax, there’s usually a table titled “detailed family outcomes” included in the budget.

It was first published in 2005 by then-treasurer Peter Costello, and has been a regular component of the budget papers over the following years.

It was included to justify the GST, and the carbon taxes. It illustrates the impact the budget will have on different types of families, earning varying incomes.

Hockey’s first federal budget was also the first without the table since it was initially introduced.

Peter Whiteford and Daniel Nethery from ANU have calculated the impact of the budget themselves, and published the findings in Fairfax newspapers. They also made their own table:

From their article:

We find that people on benefits do the heaviest lifting. An unemployed 23-year-old loses $47 a week or 18 per cent of their disposable income. An unemployed lone parent with one eight-year-old child loses $54 per week or 12 per cent. Lone parents earning around two-thirds of the average wage lose between 5.6 per cent and 7 per cent of their disposable income. A single-income couple with two school-age children and average earnings loses $82 a week or 6 per cent of their disposable income.

Compare this to the $24, or less than 1 per cent of disposable income, paid through the deficit levy by an individual on three times the average wage – close to $250,000 by 2016–17. High-income couples could together bring in up to $360,000 a year and not contribute an extra cent.

The calculations are presented as changes to disposable income in 2016-17, as that is when most of the budget measures will come into effect. The average weekly ordinary time earnings (AWOTE) is projected to be $1,583.30 per week by then, or around $82,300.

The biggest disparity is between a 23-year-old single person on Newstart, who will lose 18.3% of their income, and a dual-income couple earning 150% and 100% of the AWOTE, who won’t be effected at all.

As Martin points out, the dollars lost per week also varies little with income. The 23-year-old on Newstart loses $47 per week, and a dual-income couple with three kids who take home a combined 133% of the average wage are $67 worse off.

A spokesperson for the treasurer told Fairfax the government had been transparent about the changes in the budget documents.

You can read Whiteford and Nethery’s report in full here.

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