Worst off hit hardest by Coalition policies: NATSEM modelling

NATSEM modelling to be released by Bill Shorten shows nine out of ten of the lowest income families with children lose out under Coalition policies. The modelling involves comparing all the government’s measures to date – excepting those it has dumped - with the policies that were in place under Labor in 2013, if they had been continued.

Those with incomes of up to A$47,000 with children will lose 7.1% of total disposable income by 2018-19 according to the modelling, while the most well off families, with incomes of $119,000 and over, will be slightly ahead.

The Institute for Governance and Policy Analysis at the University of Canberra (NATSEM), which was commissioned by Labor, found that compared with the policy settings when the Abbott government was elected, families on low and modest incomes with children lose out.

The modelling includes the child care package and also measures that are still stalled from the last budget but remain part of the government’s policy.

The income range for the first quintile is families on up to $47,000 a year; the second is $47,000-$59,000; the third is $59,000-$83,000; the fourth is $83,000-$119,000; the fifth is over $119,000.

It finds that in 2015-16 a sole parent on $55,000 with two children, one in primary school and one in high school, is $3714.86 worse off – some $71.44 a week.

By 2018-19 the family is $6107.80 worse off annually - $117.46 a week. Over the budget period the total impact is $20,647.76.

A couple with a single income of $75,000 and two children - one under school age and one in primary school – is $670.72 worse off annually in 2015 -16. A couple with one income on $65,000 with a child in primary school and one in high school would be $3734.01 worse off in 2015-16.

A dual income couple on $120,000 with two high school children would be $2196.19 worse off in 2015-16, while the annual impact on a dual income couple on $60,000 with two high school children would be $825.56 in 2015-16.

A single income couple on $50,000 with a child in primary school and one in high school is $3558.81 worse off in 2015-16. The impact on a single income couple on $40,000 with a primary school child and a high school child is $3566.87 in 2015-16.

While the modelling relates to more than this budget, Shorten said it showed “what the Budget papers refused to tell Australians - the true impact on families.

“This Budget has all the same unfairness and pain for families hidden in the fine print,” he said.

“This proves that despite the spin job, families who can least afford it are being hurt the most by this Budget. It proves that this Budget just isn’t fair.”

Tony Abbott said that this week the budget bills would be before Parliament, especially the legislation to allow instant asset write offs for small businesses for items under $20,000. The Labor party has agreed to support the small business measures.

“The priority this week is unleashing the latest creativity of the small businesses of Australia by getting the instant asset write off legislation through Parliament,” Abbott said, repeating that this was a budget “designed to encourage everyone who is out there having a go”.

Michelle Grattan does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.