ACOSS is shining a light on inequality in Australia at its national conference in Sydney, with CEO Dr Cassandra Goldie presenting the findings of the benchmark ACOSS research report, which was released on Monday (22 June).
The report ‘Inequality in Australia: A nation divided’, is based on research by ASPA members Peter Saunders, Bruce Bradbury and Melissa Wong from UNSW’s Social Policy Research Centre.
The report is supplemented with data and analysis from other sources – predominantly the ABS Survey of Income and Housing and the ABS Household Expenditure Survey.
In key findings, inequality in Australia is higher than the OECD average. The wealthiest 20 per cent of Australians have a staggering 70 times more wealth than the poorest 20 per cent. Meanwhile, a person in the top 20 per cent income group receives around five times as much income as a person in the bottom 20 per cent.
Dr Goldie said the good news is that inequality is not as extreme in Australia as in the US or UK – in large part because of progressive and highly targeted tax and transfer systems, and a minimum wage system.
“While we can be proud of our history in building our tax system and social safety net, we need to refocus our efforts on realigning and strengthening them at this time to prevent widening inequality from becoming the new normal,” she said.
“We know that inequality is a choice, and more than most, Australia has a history of knowing how to fix it. The policy solutions are within our grasp: ensuring every individual and organisation pays their fair share of tax; rebalancing tax breaks skewed in favour of people on higher incomes; redoubling efforts to stem the tide of rising unemployment; and improving the adequacy of payments for people who are unemployed or unable to obtain paid work.
“International institutions such as the International Monetary Fund, the World Bank and the OECD, have all warned nations of the dangers of rising inequality…We know from overseas that excessive inequality reduces equality of opportunity, stifles upward mobility between generations, increases social tensions, harms our economy, and reduces economic growth.”
Co-author of the recent Australia21 report Advance Australia Fair? What to do about growing inequality in Australia Dr David Morawetz said the ACOSS report made ‘an enormous contribution to our understanding of where we are as a nation today – facing a worrisome wealth divide despite enjoying more than 20 years of unprecedented economic growth’.
“The findings make it clear that the benefits of this growth have not been shared by all – wealth is now more concentrated in our country than ever before.”
A former Associate Professor of Economics at Boston University, with a PhD from the Massachusetts Institute of Technology (MIT), the founder and director of the Social Justice Fund (one of the funders of the ACOSS report), reiterated the view that widening inequality need not be inevitable.
“Through sound government policies that deliver fair taxation, an adequate safety net and access to vital community services we can reverse this trend,” Dr Morawetz said.
“In a country as wealthy as ours, all citizens should be able to realise their potential and share the benefits of growth and increased prosperity. This report is a wake-up call for our nation – a call we must heed.”
To view the report click here.