The Abbott Government, social policy and the greedy ghost of market fundamentalism

Treasurer Joe Hockey's announcement that the Abbott Government plans to increase the pension age (from 67 to 70), impose more welfare means testing and introduce co-payments for medical services comes as no surprise, but provides more evidence of the continuing assault on public spending for the less well off, the vulnerable and disadvantaged.

The Abbott Government has already imposed severe spending cuts across many portfolios and shown its intention to cut back public expenditure for the less well off by fundamentally transforming income support in areas such as the Disability Support pension (DSP), family and welfare payments and welfare support for the long term unemployed.

In addition, there is the expectation that both the report into the Welfare System (the McClure Review) and the report of the National Commission of Audit (the Business Council of Australia report), both due to be released soon, will recommend serious austerity policies and market driven social policies.

The Abbott Government's market fundamentalist policies and its austerity agenda are intended to dismantle public spending for the less well off and the vulnerable, and fundamentally transform public spending and public assets to make them suitable to deliver profit to the business and corporate sector and largess to the already well off.

What is also worth noting is that this fundamental transformation of social policy and welfare support is being undertaken without any real consultation with the social policy and welfare sector, and continues to be driven by advice from, and the agendas of influential pro- business and corporate lobby groups, such as the Business Council of Australia.

Moreover, the Abbott  Government has consistently concealed its real social policy intentions and denied it was planning to impose these policies. None of the policies were made public prior to the last election and back in November 2013 Treasurer Joe Hockey lied when he said that the Government had no plans to increase the pension age.

While it dismantles social policies that support the less well off and the vulnerable it retains and expands profligate policies for the corporate and business sector and the rich and already well off, such as superannuation tax concessions, various housing-related tax benefits, paid parental leave, asset tests and corporate tax benefits, to name but a few.

On his blog En Passant former Tax Office economist, blogger, activist and academic John Passant alerts us to the hypocrisy and deceit of Treasurer Joe Hockey's proposals on the age pension:

Let me get this right. The revenue forgone on tax concessions for superannuation at $45 bn will soon be more than the cost of the pension (over $40 bn). Of that $45 bn in tax concessions $10 to $15 bn will go to the top 10% of income earners. Yet Australia’s greatest Treasurer, Joe Hockey, wants to rein in expenditure on the pension by for example extending the access age to 70 (after Labor increased it to 67 over time by 2023) and tightening up the asset test to perhaps include the family home. Priorities. 

According to the OECD Australia has one of the lowest relative pensions of any member countries (Turkey and Mexico are lower) and 35% of Australian pensioners live in poverty. Priorities.

Abbott led opposition to adopt UK style Big Society policies

 Writing in the Sydney Morning Herald Lenore Taylor traces the influence of the UK Conservative Government's Big Society agenda on the Coalition Opposition's social policy agenda for the next election.

Coalition frontbenchers have been instructed to slice away federal bureaucratic oversight of aged care, childcare, employment and family services in a bid to devolve government power and deliver budget savings through public service cuts.

The Coalition, which needs to find more than $30 billion in spending cuts, will pledge cuts to the bureaucracy, but says it will not hit frontline services. The policy is in line with the controversial ''Big Society'' philosophy of British thinker Phillip Blond, who was in Canberra this week for meetings with Coalition leader Tony Abbott and most of his frontbench.

Coalition families spokesman Kevin Andrews told The Saturday Age he had developed the model for stripping unnecessary federal oversight of federally funded services delivered by community and private organisations.

But Big Society rhetoric provides cover for severe austerity measures and a fundamental transformation of the delivery of publicly funded human and community services. 
 
In the UK Big Society rhetoric was used to justify sweeping cuts to public services, to community services and even to the community and voluntary organisations it was supposed to nurture.
 
It has also produced the largest ever privatisation of human and community services in UK history with large swathes of the human and community services industry now under the control of private corporations.

Despite promises by the UK Government that local devolution would primarily benefit small community based not- for- profit, it has been large corporations who have been the real winners.

Taylor notes, correctly, that:

But in Britain, the outsourcing program that was supposed to benefit little community groups ended up giving enormous contracts to large corporations, such as Serco, which runs Australia's detention centres, and in some parts of Britain now runs all the government-funded schools.

The implications of the Big Society agenda for Australia are well documented in a recent report by the Centre for Policy Development titled Big Society: How the UK Government is Dismantling the State and what it means for Australia. 

The Report shows among other things that the reality of Big Society Agenda is vastly different to its rhetoric. The impacts of the Big Society programs in the UK have included:

• An £81 billion cut in public spending over four years including an average 19 per cent budget cut to government agencies, 60 per cent cut to the budget for new public housing and £7 billion cut to the welfare budget.
• The UK’s public service is expected to shrink by up to 710,000 public servants over six years.
• Corporations and the largest charities have dominated the commissioning process: 35 of 40 Work Programme (employment agency) contracts were awarded to corporations.
• Cameron’s budgets have dealt a £5 billion funding cut to the UK’s community sector and funding cuts of £110 million to 2,000 UK charities
• The number of people employed in the UK’s community sector fell by 70,000.
• Local government budgets were cut by more than a quarter in 2010-11 resulting in staff cuts of 10-20 per cent and widespread cuts to programs.
• During 2010-11, public sector employment fell by 4.3 per cent. Private sector employment increased by 1.5 per cent.