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2019 Budget doesn’t quite pass the ‘Fairness Test’ for low income households

The South Australian Council of Social Services (SACOSS) reacted with a mix of concern and relief to today’s state budget. SACOSS was pleased the budget did not contain sweeping cuts to services which many in the sector feared, but there was a $360m reduction in departmental budgets as well as some specific funding cuts announced. These cuts will inevitably see services diminished in some areas.

Ross Womersley, SACOSS CEO, said, “We are pleased that the government is investing in the future of South Australia through infrastructure like roads, housing and capital projects. We’re unfortunately disappointed that there has not been the same investment made in social services infrastructure. This year’s budget was tipped as ‘tough but fair’ by Treasurer Lucas – we do not think that they have completely delivered on this.
“Once again, we are seeing avoidance of spending where it’s needed most and short-sighted cuts which will have a huge impact well beyond the sector. Absence of necessary funding to cover gaps in Mental Health services, cuts to domestic violence and victim support services - these are likely to impact hospitals, homelessness, incarceration and other public services.”
There were however some welcome initiatives in the budget, including:

  • Changes to land tax aggregation to close loopholes for people with multiple landholdings – a change called for by SACOSS.
  • Investment in social housing, including $21m for much needed maintenance on existing SA Housing properties, and $2m for an Affordable Housing Fund for low income first home buyers.
  • New funding to extend existing time-limited programs such as the Child and Family Assessment and Referral Networks (extended for 1 year), the Domestic Violence Disclosure Trial (1 year extension) and the Tiraapendi Woodli Justice Reinvestment Project in Port Adelaide (two more years), plus new funding for a $2.5m trial of a child and family support program to assist vulnerable families in northern Adelaide.

The key concerns SACOSS raised about the budget measures included:

  • A range of above-inflation increases in fees, charges and fines that will impact disproportionately hard on those on the lowest income, including a 5% increase in most government fees and charges and motor registration, as well as an even greater increase in fines for high risk offences.
  • A range of new measures that will increase costs and impact low income households, including increases in hospital car parking costs, re-introduction of public transport Metrocard fee and the removal of a cheaper 2-section fare, and the removal of concessional motor vehicle registration for those in regional areas.
  • Direct funding cuts to services to vulnerable people, including a $1.2m p.a. cut to the Victim Support Service, cuts to the Women’s Domestic Violence Court Assistance Service and a $1m p.a. cut to the Adult Community Education program.

“If we invest in early intervention and support services, we build into a stronger, more resilient South Australia and prevent some of our most vulnerable citizens from finding themselves in extreme situations,” Mr Womersley concluded.
SACOSS recognised that with significant cuts to South Australia’s share of the GST, this was always going to be a tough budget. There were a number of ways that SACOSS petitioned the Treasurer to implement new revenue measures to fill that budget hole. One of these was income based fines, but instead the Treasurer opted for blunt and punitive increases which will hit the poor hardest. We’re pleased to see that our recommendation of land tax aggregation was adopted but see the reduction in the top-rate of land tax was unnecessary and wasteful.
SACOSS will brief members and release a Budget Snapshot tonight. SACOSS’ full Budget Analysis will be available at its Members’ Breakfast with the Treasurer, next Tuesday 25 June.

Published Date: 
Tuesday, 18 June 2019