PDC: Welfare policy

Outdated Policy This policy is outdated but has been kept for reference purposes. The updated policy can be found here.

This Working Group (WG) was established by the Policy Development Committee (PDC) on 6 February 2013. The working group was tasked with developing policy on reform of the transfer payments system. It was chaired by Mark Gibbons and has prepared the following policy text for potential adoption by PPAU.

Transfer payments policy

Platform amendment

Transfer payments include the full scope of government payments and benefits which act together to provide a social safety net. While such a safety net is essential, the operation of it has been corrupted in Australia by lack of systemic planning and continual vote-buying exercises. A range of ad-hoc middle-class welfare measures operate with little economic merit and poor coordination[1] (as an example, the Howard-era Family Tax Benefit part B provides incentive to parents to stay off work,[2] while the Gillard-era Paid Parental Leave scheme offers a counter-incentive to stay in the workforce[3]). At the same time evidence is emerging that the fundamental purpose of welfare (alleviation of poverty) is no longer being adequately served.[4]

Australia's tax free threshold is currently under $20,000 per year[5]. Low income earners are thus routinely taxed, with the money subsequently churned back to them again through the welfare system. Greater independence, transparency, and social justice are provided if money is not taken in the first place (see: tax policy) and the transfer system operates efficiently, provides incentives to work, and targets the areas of greatest need.

Policy text

The Pirate Party will create a customisable and streamlined structure for transfer payments through the following measures:

Introduce a modular, simplified transfer payments system

• The current body of payments (Family Tax Benefits parts A and B, Baby Bonus, School Kids Bonus, Newstart, Age Pension, Parental Leave Scheme, Disability Support Pension, AusStudy, Carer Payment, etc) will be replaced.
• A new Basic Income will be introduced for persons aged 18 and over:
  • This will be commence at $300 per week per person (equal to The Queensland Council of Social Service estimates for minimum standard of living[6]) and will provide a safety net to all citizens who have no other income source.
  • Claimants will be required to seek employment or engage in full-time study.
• A range of modular supplemental payments will also be made available:
  • A Pension Supplement will provide an additional $70 per week for senior citizens, disabled persons and full-time carers.
    • Recipients of this supplement will be exempted from obligations to study or seek employment.
  • A Childbirth Supplement will raise the Basic Income for one parent to be equivalent to a full-time minimum wage for a period of eighteen weeks after childbirth.
  • A Parenting Supplement will provide a fixed amount per child to cover food, clothing and other direct costs of child raising.
    • An additional childcare allowance will be available for each child aged under 5.
    • An additional education allowance will be available for each child aged 5 and over.
    • Children aged 16 to 17 may receive their supplement in the form of a youth allowance payment if they are not supported by their families.
    • Persons claiming the Parenting Supplement and associated rebates will be required to meet minimum parenting standards including vaccination and school attendance.
  • Rental assistance will provide an additional $25 per week to persons who lack social housing.
    • Movements in this allowance will indexed to changes in average rental costs.
• All current assets and incomes tests will be replaced with a single means test applying to the Basic Income and all linked supplements.
• Withdrawal rates for all payments will reflect differing work expectations applying to different payments, and will be set at levels that provide an incentive to work.
• The Basic Income and all linked supplements will be tax-exempt to avoid churn and improve interaction with the tax system.
• The Basic Income and all linked supplements (excepting rent assistance) will be subject to indexation based on the CPI, with annual reviews to ensure adequacy.

[1] Australia Institute, The State of the Australian Middle Class, Page 16
Rout, Economists call for end to middle-class welfare, 25 February 2013. http://www.theaustralian.com.au/national-affairs/treasury/economists-call-for-end-to-middle-class-welfare/story-fn59nsif-1226584602417 (Accessed 1 March 2013).
[2] http://www.humanservices.gov.au/customer/services/centrelink/family-tax-benefit-part-a-part-b
[3] http://www.humanservices.gov.au/customer/services/centrelink/parental-leave-pay
[4] Australian Council of Social Service, A fairer, more efficient tax and social security system, Page 25
[5] http://www.ato.gov.au/youth/content.aspx?doc=/content/39122.htm&alias=taxfreethreshold
[6] Australian Council of Social Service, A fairer, more efficient tax and social security system, Page 27

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