The 2014-15 Federal Budget has been released, revealing the Government’s policy and spending priorities.
This Budget will have many effects on the Uniting Church’s service providers (UnitingCare agencies), as well as those who require the support and help of the UnitingCare network.
This year’s Federal Budget has a number of features:
- Cuts to welfare payments across the board, delivered through a combination of pauses, indexation changes, and eligibility restrictions. These cuts are deep but most are designed to take effect relatively slowly.
- Increased contributions by individuals in many areas of government-supported services, including retirement income, healthcare and education.
- Some tighter targeting of welfare to lower income earners, such as with Family Tax Benefit payments.
- Very little in the way of revenue reform to improve the structural position of the budget.
Indexation of the Aged Pension and Disability Support Pension will change so their value will grow more slowly in future. They will join Newstart and other allowances in declining in value compared to the incomes of other Australians. Over the long-term, this is likely to create greater hardship for people who have to live on these payments, particularly those with little prospect of securing employment. The government has introduced some measures, however, to support transition to work and study.
The age at which people can access benefits is being raised in several ways. The eligibility age for the Age Pension will ultimately rise to 70; some people under 30 will spend less time on the Newstart payment, and more time on the lower Youth Allowance, or on no benefit at all. Disability Support Pension recipients under 35 will have additional requirements placed upon them.
Indigenous programs have been significantly reorganised and their funding reduced.
In the short term, aged care funding has been maintained. There are longer term challenges ahead, highlighted by the tapering, four years from now, in the rate of funding increase to the Commonwealth Home Support Programme, as well as the immediate scrapping of a pilot project designed to assist older Australians to access equity in their homes and downsize their residences. There will need to be future work to strengthen the funding base to support Australians as they age.
Central to this Budget are a number of proposals to reduce the deficit by cutting the size and scope of government. This will impact on charitable and not-for-profit sector, in particular those that deliver community and social services.
The key announcements here include:
- A three year pause in the indexation of a number of administered programmes
- Abolition of some 230 programmes across the APS
- Consolidation of Department of Social service programmes and the introduction of five year funding agreements for service providers that deliver Communities for Children Facilitating Partner Services, Family and Relationship Services and Family Law Services
- The re-establishment of the Community Business Partnership and confirmation of the intention to abolish the Australian Charities and Not-for-profits Commission
- Development of a contestability framework to support outsourcing of government functions