Where is the Government’s moral compass?

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By Leith van Onselen

In a cruel twist, the Abbott Government has informed a broad range of welfare agencies that they will no longer receive federal funding:

[The Department of Social Services] yesterday informed a range of welfare support groups that their funding had been abolished. Organisations losing funding include Blind Citizens Australia, the Australian Federation of Disability Organisations and homeless bodies such as National Shelter and the Community Housing Federation.

According to Fairfax, funding to the homeless and the low-income housing sector will be particularly hard hit by Budget cuts:

Fairfax Media has learned that… a number of other community services groups providing emergency accommodation relief lose their funding.

Highlands Community Centres in the NSW southern highlands, which has 450 families on its books and has been serving people in distress for 20 years will no longer receive any federal funding and does not know how it can continue to provide the same service.

National Shelter, a peak advocacy group… [will] lose its funding and its three-year contract [will be] torn up a year early…

Already in 2013 and 2014 a number of national sector peak bodies have been defunded…

Prime Minister Tony Abbott has tasked Mr Morrison with getting more people off welfare and into jobs…

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When viewed alongside the Coalition’s attempt at denying under-30s access to unemployment benefits, which come at a time when youth unemployment and labour underutilisation are soaring (see below charts), one can only conclude that the Abbott Government has lost its moral compass.

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Instead of clawing back loose change from the most vulnerable members of society in a desperate bid to plug the Budget deficit, the Abbott Government should instead attack Australia’s world-beating tax expenditures – such as superannuation, negative gearing, and capital gains tax concessions – which deprive the Budget of many billions of dollars of revenue, make the tax system less progressive, and overwhelming benefit richer, older Australians.

It’s not rocket science.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.