The Australian Welfare State and How to Kick it

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Welfare dependency has increased dramatically since the mid 1960's, with a growing trend of more claimants and fewer payers. Saunders believes the welfare system is revealing serious flaws which are encouraging welfare dependency mainly due to a system which does not encourage self-reliance and work ethic for the majority of recipients. Saunders addresses the issue of poverty amongst welfare dependent households, arguing that current benefits sit above the poverty line and that increased benefits will not necessarily solve poverty, alternatively increasing dependency beyond current levels. He recognises the efficiency and equity implications of the current system, calling for significant and simultaneous reforms to the tax system, labour market regulations and eligibility rules for accessing welfare in order for the current trend to reverse itself.

Saunders believes that welfare should be a conditional right (contrary to the Welfare lobby) and that instead of Government acting as a money dispenser it should be focussing more heavily on getting people into work sooner. The aim of his suggestive welfare reforms being one based around increasing work incentives, though this would require stronger constraints on eligibility and entitlements than is presently enforced. Unlike OECD and other Western countries countries which have a time limit on unemployment benefits and insurance based social security, Australia has no time limit on unemployment assistance and too flexible time constraints on other benefits and still bases it's welfare system off tax supplied support.

Australian welfare dependency is concentrated in Disability Support Pensions, Single Parent Payments and Unemployment benefits. The welfare lobby claims that almost...

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...ustralia relying on Europe's system for guidance due to distinct cultural differences in European nations. He refers to the Scandinavian countries causal link between high welfare spending and strong social cohesion as partly a product of the nations strong cultural homogeneity, one of which is very different to the pluralistic and heterogeneous nature of Australia and America (Saunders, 2004: 61). To invest in the European system where there is a trend for larger Government is therefore asking for increasing welfare dependency and an overall counterproductive and potentially problematic system.

With the Centre for Independent Studies release of their TArget 30 campaign to reduce the size of Government expenditure below 30% of GDP over the next 10 years

Works Cited

Saunders, P 2004, The Australian Welfare State and How to Kick it, Duffy and Snellgrove, Sydney.

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