In Australia, land of the 'fair go', not everyone gets an equal slice of the pie

This is part of a series examining Australian national identity, especially around the ongoing debate about Australia Day.

Australian politicians, interest groups and political and social commentators have long drawn on the idea of the “fair go”. In fact, despite their ideological differences, Australia’s last four prime ministers have all used the term at some point.

In government and opposition, Labor leader Kevin Rudd referred to the fair go, particularly when criticising the Howard government’s WorkChoices industrial relations reforms.

In December 2011, Prime Minister Julia Gillard also argued that “we are the people who hold onto mateship and the fair go”, citing Labor’s support for the National Disability Insurance Scheme and health spending in support of this claim.

The idea of the fair go is not unique to Labor, either. Robert Menzies and Malcolm Fraser used the term in campaign speeches, and Prime Minister Malcolm Turnbull also made reference to the fair go when discussing tax reform in 2015. He stated:

We have a very unique culture in Australia and we have a very good mixture of capitalism and free market, but we also have a culture of fair go, of looking after each other.

The idea of the fair go also figured prominently in debates over the 2014 federal budget, which was attacked for placing a disproportionate burden on lower-income families.

Given the term is used by such different politicians in a range of contexts, it is impossible to associate the idea of the “fair go” with any precise meaning. It generally stands for whatever the person using the term regards as fair or just, although it generally has an egalitarian flavour.

However, even political theorists who devote themselves to analysing political values and concepts differ over what an egalitarian approach to fairness and justice requires. At the most basic level, most egalitarians agree that justice and fairness demand that all citizens have their basic needs met. So ending poverty, for example, is an important egalitarian goal.

Equality of opportunity is also regarded as another important requirement of justice. This means that all citizens should have the same chance to develop their natural abilities, regardless of their backgrounds. For example, it is wrong if a child from a working-class background is disadvantaged because the schools she has access to are worse than the schools to which affluent children have access.

Some egalitarian political theorists take the idea further, arguing that justice and fairness requires a more equal distribution of social resources, not just equal opportunities.

There are a variety of different reasons for this. Some defend the idea because of the beneficial social consequences it has. Others challenge the distinction between “natural” and “social” forms of inequality, arguing that we should be concerned about inequalities resulting from differences in our natural abilities, not just our social environment.

Perhaps the most influential approach in the post-war period is John Rawls’ difference principle, which states that inequalities are only justified if “they are to the greatest benefit of the least advantaged”. This means that we should aim for equality in the distribution of social resources, but not to the point that we damage the economy and actually leave the poorest citizens worse off than they were before.

How does Australian society match up against these goals? For a start, there is an ongoing problem with poverty in Australia, with recent research suggesting that the relative poverty rate has been between 10% and 14% of households since 2000 (where the poverty rate is set at 50% of median income).

Around 5% of households were suffering from what is known as “deep exclusion”. Australians with a long-term medical condition or disability were particularly vulnerable, as were indigenous people. People lacking a year 12 qualification and those in public housing also had higher levels of deep exclusion.

Equality of opportunity is usually tested by focusing on whether children end up in a different income category from their parents. In the literature, this is usually measured through intergenerational earning elasticity, which “benchmarks adult children’s earnings with their parents’ earnings after controlling for demographic characteristics”.

There are major methodological challenges in measuring intergenerational elasticity in an Australian context. There are also relatively few studies on the topic.

However, a 2007 study by Andrew Leigh found that Australia had a higher level of mobility than the US. As he put it in his 2013 book, “in the United States, the heritability of income is similar to the heritability of height. But in Australia, income is only about half as heritable as height”. A 2016 study reached broadly similar conclusions to Leigh, finding that Australia has “a relatively large amount of income mobility”.

But doing relatively well internationally is still a long way from saying there is equality of opportunity. Being half as heritable as height still suggests the playing field is a long way from level.

There has also been an increase in income inequality over recent decades. While there are different ways of measuring income inequality, the Gini coefficient is one of the most common measures. A country with a Gini coefficient of 0 has complete equality in incomes, while a country with a Gini coefficient of 1 has complete inequality.

In Australia, the Gini coefficient in disposable household income was 0.309 in 1995 but 0.334 in 2010. Going back further, the increase in inequality is even more marked – the Gini coefficient in 1980 was 0.2.

In 2011, the OECD reported that according to 2008 figures, “the average income of the top 10% of Australians was … nearly 10 times higher than that of the bottom 10%”. Australia is once again more equal than the US, but more unequal than the OECD average.

So although politicians claim to place a great deal of importance on the idea of the fair go, there are still significant ways in which Australian society seems to depart from this idea.

Given the reforms the Coalition tried to get through (for the most part unsuccessfully) in the 2014 budget, and the recent scandal over Centrelink, it seems likely that the “fair go” will continue to be under political pressure in the years to come, whatever the rhetoric.

Catch up on other pieces in the series here.