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Is Australian Society Egalitarian?

Info: 10492 words (42 pages) Essay
Published: 13th Oct 2021 in Society

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Australia's national identity is centred on images of Australia as being 'classless' and 'egalitarian'. We pride ourselves on 'mateship' and 'having a go', but the widening gap between rich and poor tells another story. At a time when Australia has experienced a sustained, 28-year period of economic growth, the inequality of marginalised groups – including unskilled workers, Indigenous Australians and people with disabilities – has increased. As will be shown, targeted, compensatory government policies, aimed at improving educational outcomes, will assist in improving Australia's position as an egalitarian society, and once again restoring our status as a nation of the 'fair go'.

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Egalitarianism is a philosophical perspective emphasising equality and equal treatment. Argy (2003) defines egalitarianism policy as having three main goals; a strong welfare safety net, an even distribution of incremental gains from reform across the community, and equal opportunity and greater social mobility. Strong welfare safety nets in Australia include our progressive taxation system, minimum wage and superannuation, supporting Australia's status as an egalitarian country.

Since Federation, notions of egalitarianism have been central to Australian culture and way of life. We celebrate the sacrifices of our armed forces and the bonds of 'mateship' that were formed under impossible circumstances and celebrate Australia as a nation where all have access to a 'fair go'. More recently, the notions of 'fair go' and 'mateship' have become regular inclusions in political rhetoric. John Howard claimed 'mateship' to be an enduring value of the national 'character' (Dyrenfurth, 2014), while Julia Gillard claimed to hold onto the 'fair go' when discussing the National Disability Insurance Scheme (Barry, 2017).

However, the inclusions of 'mateship' and 'fair go' within Australian culture are not evidence enough to support whether Australian society is egalitarian and equal. Measures of income and wealth inequality provide a snapshot of how benefits of economic activity are distributed (Wilkins, 2015) and whether incremental gains from reform are evenly distributed (Argy, 2003).

Income includes revenue and financial inflows from economic activity, property income and social benefits, whereas wealth considers the total financial and non-financial assets and liabilities of individuals (OECD Better Life Index, n.d). It is important to consider how income and wealth in Australia to determine how egalitarianism has, or has not, developed over time. The Lorenz curve graphically represents the relationship between income, or wealth, and population, or the extent to which income and wealth are distributed across the population. The Gini coefficient is a measure of income inequality, and it is calculated when a 45-degree line is drawn on the Lorenz curve. The Gini coefficient is the area between the Lorenz curve and the diagonal line, divided by the total area between the diagonal line and the horizontal axis (Blackwood & Lynch, 1994). A Gini coefficient value of 0 indicates an egalitarian income distribution.

According to the Australian Bureau of Statistics, Australia's Gini coefficient for gross household income in 2017-18 was 0.439, with the top 20% of households receiving 40% of total income (2019). The lowest 20%, in comparison, received 8% of total income. Australia's income inequality is also represented by the proportion of the population who experience income poverty. Over 3 million Australians live below the poverty line income of $433 week (singles) (ACOSS, n.d.), including one in eight adults and one in six children.

The distribution of wealth is more unequal than the distribution of income – the Gini coefficient was 0.621 for the same period, with the wealthiest 20% of Australian households owned 63% of total household wealth. By comparison, the lowest 20% of households owned less than 1% (Australian Bureau of Statistics, 2019).

Both income and wealth Gini coefficients have increased over the last 20 years. In fact, Australia now has greater income inequality than most countries within the Organisation for Economic Co-operation and Development (henceforth 'OECD') (OECD, 2019). The inequality is particularly pronounced for minority groups, namely unskilled people, people with disabilities and Indigenous Australians, challenging the extent to which we can continue to call ourselves egalitarian, or a nation of the 'fair go'.

Since mid-1991, Australia has reported consecutive periods of economic growth, registering an average growth rate of 3.2% per annum (Austrade, 2018). Although wise monetary and fiscal policy has played a role, a significant contributing factor for Australia's ongoing economic success is due to our close trading relationship with South-East Asia, particularly China. In fact, Australia will soon be a part of the Regional Comprehensive Economic Partnership, a 15-member, Asian free-trade part involving nations that produce 29% of global gross domestic product and account for half the world's population (SBS News, 2019).

Australia's recent economic success and our participation in free-trade agreements is facilitated by the market forces associated with globalisation. Globalisation is defined by the OECD as the increasing internationalisation of markets for goods and services, giving rise to increased mobility of capital, technological innovation and an increasing interdependence and uniformity of markets (2013). Put simply, it is the increased economic and cultural interdependence and integration of countries, allowing the free movement of goods and services.

Although the Australian economy has prospered as a result of globalisation, an adverse effect of the increased integration of nations is the dismantling of the manufacturing sector. Globalisation has made it simpler for organisations to operate across national borders. As a result of cheap labour and greater economies of scale, labour-intensive, manufacturing processes previously managed in Australia were transferred offshore to developing countries. Although based on research from the United States, Kollmeyer argues the decline of trade unions, within the context of deindustrialisation and offshore manufacturing, profoundly effects inequality and social stratification (2018).

Manufacturing employment as a share of the Australian labour force has declined substantially (Brady & Denniston, 2006). The census revealed the number of manufacturing workers in Australia had fallen 24% over the five year to 2016. The manufacturing sector provides employment opportunities for traditionally unskilled, blue-collar workers. As a result of manufacturing shifts offshore, those who once relied on manufacturing and similar unskilled sectors for employment, are now struggling to upskill, or re-train, in order to find employment, and consequently, are reliant on government assistance.

Globalisation and the restructuring of the nation's manufacturing sector have contributed to Australia's economic restructuring, whereby Australia has progressed from a manufacturing to services economy (Martinus, Sigler, O'Neill & Tonts, 2018). A shift from manufacturing to services is a natural consequence of any developing nations, outside of forces associated with globalisation. Consequently, it can therefore suggest there are additional reasons which have contributed to the increase in inequality in Australia, particularly in relation to indigenous Australians and people with disabilities.

In addition to embracing globalisation through the adoption of market-oriented economic policies, successive Labor governments between 1983 and 1996 implemented targeted, compensatory social policies (McClelland & John, 2006). This included the Superannuation Guarantee under the Labor Keating Government, which required employers to make compulsory contributions to employees' superannuation.

The election of the Howard Liberal Government in 1996 presented a shift in domestic labour market and social welfare policies. The Howard Government introduced the concept of 'mutual obligation', whereby welfare recipients were expected to do something in return for ongoing government assistance (McClelland & John, 2006). The move represented a paradigm shift in which welfare support is no longer considered a 'right', but rather 'conditional' on unemployed people meeting their part of the 'mutual obligation'.

The Newstart Allowance is an unemployment benefit, whereby individuals are deemed eligible if actively seeking work. Actively seeking work includes applying for roles, undertaking vocational education or training or participation in Centrelink-approved programs, including 'Work for the Dole'. 'Work for the Dole' was implemented by the Howard Government in 1998, whereby eligible job seekers would receive income support in return for engaging in activities aimed at gaining skills and experience for employment (Department of Employment, Skills, Small and Family Business, 2019).

The Newstart Allowance for Singles is $559 per fortnight (Department of Human Services, 2019b). It has not changed in real terms for 25 years. The poverty income line of $866 per fortnight for Singles shows how, unsurprisingly, the group of people experiencing poverty the most are those relying on government support (ACOSS, n.d.). In a Senate inquiry, KPMG proposed increasing Newstart to $740 per fortnight, joining the chorus of charities, welfare advocacy bodies and health groups that have been advocating for changes (Henriques-Gomes, 2019). An inadequate Newstart "tears at our inclusive social contract" (2019), reiterating the relevancy of government assistance to certain groups in society. Prime Minister Morrison continues to reject support to increase Newstart, declaring "the best form of welfare is a job" when rejecting support to increase Newstart (Murphy, 2019).

Despite the government social policy shift from targeted and compensatory to mutual obligation, it is clear government assistance plays a crucial role in alleviating income poverty experienced by certain groups, including indigenous Australians and people with disabilities who are more likely to experience inequality and protracted income poverty. Indigenous Australians have higher unemployment rates than non-Indigenous Australians (Australian Institute of Health and Welfare, 2017). In addition, Indigenous Australians earn lower household incomes and are more likely to receive government assistance (2017). The inequality is more pronounced for Indigenous peoples in remote areas.

Education has a positive effect on an individual's economic outcomes, particularly employment and income (Australian Human Rights Commission, 2008). Consequently, governmental assistance provided to Indigenous Australians, including ABSTUDY, Assistance for Isolated Children Scheme and Relocation Scholarship, focus on improving educational outcomes. ABSTUDY, and precursor Aboriginal Study Grants Scheme, is available to provide financial assistance to Indigenous Australians in approved courses, apprenticeships and traineeships (Department of Human Services, 2019a). The 2006 Census reported improvements to Year 12 completion, up 3% to 23% (2008). The 2016 Census also showed an improvement in weekly median household income, up $212 to $1,203 (Australian Bureau of Statistics, 2017).

The Australian Government's approach to assisting people with disabilities is fragmented and complex. The current Australian disability support system separates the provision of income support from the provision of services. The National Disability Insurance Scheme (NDIS), legislated in 2013, focuses on the provision of services, whereby people with significant disabilities are entitled to receive funding for necessary support. The Disability Support Pension (DSP) is aimed at providing financial assistance for those unable to work. However, recent changes to both schemes have shifted disabled peoples to Newstart, where the basic rate of $555 per fortnight is $370 less than that of the DSP (Hermant, 2019).

The Royal Commission into Violence, Abuse, Neglect and Exploitation of People with Disability was established in April this year with the intention of providing recommendations to address inequalities faced by people with disability. A four-day inquiry is currently underway specifically focusing on education, with submissions so far highlighting disabled peoples are not receiving equity in their education (Lunn, 2019).

As education positively effects an individual's economic outcomes (Australian Human Rights Commission, 2008) and plays a direct role in an individual's ability to escape the cycle of poverty, it is vital the Australian government continue to provide targeted, compensatory social policies aimed at improving educational outcomes. While support is in place for certain disadvantaged groups, the current rhetoric around welfare and mutual obligation is negative in tone, and there is significant room for improvement which in turn could assist Australia's standing as a nation of the 'fair go'.

Access to healthcare, education and superannuation also contribute to one's liveability and equal standing within society. Government funding on primary to tertiary education has decreased significantly since 2005, yet private schools continue to receive a disproportionate share. In addition, privately funded hospitals are predominantly located in urban areas, placing rural and remote populations at a disadvantage due to poorer quality hospitals and minimal choice. Women are disadvantaged when it comes to superannuation, retiring with 47% less superannuation than men and only one third of government superannuation tax concessions (Women in Super, n.d.). This represents further evidence upon which it can be surmised that Australia is far from egalitarian.

Inequality has increased in Australia over the last 20 years. Despite an uninterrupted, 28-year period of economic growth, incremental gains from both economic activity and government reform are not evenly distributed across the community. The Australian Government has a responsibility to all citizens, including ensuring those placed at a disadvantage are provided with opportunities to improve their situations. It is clear targeted, compensatory government policies, aimed at improving educational outcomes, will assist in improving Australia's position as an egalitarian society, and once again restoring our status as a nation of the 'fair go'.


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