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The burden of power and the challenge for Labor

By Tristan Ewins - posted Friday, 17 October 2008


But perhaps an even greater commitment may be necessary.

Importantly, Labor must not use the current crisis as an excuse to implement austerity, or fail in its duty of care to vulnerable and struggling Australians. In the face of rising living costs, the question of pensions has loomed large in public debate. After originally prevaricating on the issue of pensions, Rudd Labor is now set to make a significant intervention in favour of these people.

A $10.4 billion stimulus package has been unveiled. Although action is necessary immediately, most pensioners will nevertheless be glad to receive a single payment of $1,400 as of December 8.

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Pensioner couples, meanwhile, will receive $2,100

Following initial confusion, it now appears that this program will include aged pensioners, disability pensioners, carers, Veteran Affairs pensioners, and eligible self-funded retirees holding a Commonwealth Senior Health Card.

Such initiatives have been accompanied by promises to provide 75 per cent of families with dependent children with $1,000 for each child.

In further initiatives, a temporary expansion of first home buyer grants will provide $14,000 for established houses; $21,000 if the house is new. This will only apply until June 2009 and might be considered to be a stop gap measure to stimulate the economy until the effects of infrastructure construction flow through. There are dangers, here, of sparking another dangerous housing market bubble.

Whereas these outlays will provide much-needed respite for many, the more cynically minded might conclude that since job seekers, single parents and students have not enjoyed the same public profile or sympathy, then neither the government nor the Opposition felt compelled to regard their plight as being of the same order.

Importantly, there is a further and most dire need for a broadening and deepening of protections for low-paid and vulnerable workers, including those without children. Means tests for pension eligibility - given the circumstances - ought to be relaxed also. The call must go out now among the ranks of both Government and Opposition - as well as from the Greens, Family First and independents - that double standards are not acceptable.

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As to whether or not a more ambitious plan is affordable, a sense of proportion should be maintained. After all, the broader Australian economy is valued at more than $1 trillion.

Expanding the tax base further could provide a windfall for pensions, services in health, aged care, community child care, education, housing; and in the construction of transport, communications and other infrastructure. And proceeds of tax reform should provide for counter-cyclical purposes, as well as ameliorating unemployment levels.

With an increase in public expenditure as a proportion of GDP of between 1 per cent and 3 per cent, the annual commitment, here, could be of the order of $10 billion to $30 billion, depending on the real and underlying need for social security, infrastructure and services.

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About the Author

Tristan Ewins has a PhD and is a freelance writer, qualified teacher and social commentator based in Melbourne, Australia. He is also a long-time member of the Socialist Left of the Australian Labor Party (ALP). He blogs at Left Focus, ALP Socialist Left Forum and the Movement for a Democratic Mixed Economy.
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