This year’s budget provides little support for those in greatest need, including the aged-care sector and people who are unemployed – with women over 40 bearing the heaviest burden. By Rick Morton.

Budget 2020 does little for the vulnerable

People queuing outside a Centrelink office in Sydney on March 24.
People queuing outside a Centrelink office in Sydney on March 24.
Credit: AAP Image / Joel Carrett

Just six days after a blistering report from the Royal Commission into Aged Care Quality and Safety about the government’s Covid-19 response, and almost a year after the commission’s interim report, titled “Neglect”, Tuesday’s federal budget contained almost no new funding for nursing homes, and no urgency for their reform.

The budget papers, which run to almost 1000 pages, bring welcome money for home care places – $1.6 billion to create 23,000 packages over four years – but in residential aged care, where more than 670 elderly Australians died as a result of a failed coronavirus response, longstanding and critical problems in the sector remain unaddressed. Even the centrepiece home care announcement, if it were delivered in one year rather than over four, would only reduce the 100,000-person-long waiting list by less than a quarter.

In aged care, as in other areas overlooked by this budget, the people most affected are women, particularly those over 40. These women make up the vast majority of the paid and unpaid caring workforce, one of the fastest-increasing segments of the homeless population and, now, the majority of JobSeeker recipients.

The budget allocates scarcely more than $200 million to nursing homes, although much of this money is administrative. It will be drip-fed over three years, with no increase in subsidies for elderly residents. There is nothing for worker conditions or pay in an industry that’s one of the most dangerously low paid and insecure. Not even funding to increase the number of staff in homes.

“The Interim Report noted that the aged care workforce is under-resourced and overworked,” royal commissioners Tony Pagone and Lynelle Briggs wrote in the Covid-19 report, released at the beginning of October. “It is now also traumatised.”

Multiple sources within the royal commission have told The Saturday Paper that the federal budget is a thinly disguised rebuke of the inquiry’s work, “unsurprising but devastating” in its “arrogance” and an “extremely concerning” statement on the value of older Australians.

The largest single measure for nursing homes in the budget – $91.6 million to “continue the reform to residential aged care funding” as part of a new care classification system – has been in the works for three years. The timing in this budget means it will be at least another two years before trials are completed.

The architect of the new Australian National Aged Care Classification tool, University of Wollongong professor Kathy Eagar, told The Saturday Paper she was “stunned … the budget did not start to address in any sustainable way the crisis in residential aged care”.

“Instead of another quick fix, I was expecting that the government would use this budget to make a down payment to fix well-recognised inadequacies in residential aged-care staffing,” Eagar says. “Safe, quality residential aged care requires a big increase in overall staff numbers. This includes a substantial increase in registered nurses and allied health staff.

“I can only presume the government is holding back waiting for the final report of the royal commission, but there is a real risk that more residents will die waiting for adequate care.”

Only one state-run nursing home in the country received explicit funding in the budget: Strathalbyn and District Aged Care Facility in South Australia, which received $700,000 this financial year to expand the number of aged-care places.

The facility is in the electorate of Mayo, held by MP Rebekha Sharkie of Centre Alliance, the party whose vote secured the passage of the government’s controversial higher education reforms. Sharkie has lobbied both state and federal governments to rebuild and expand the Strathalbyn home.

While insecure work in the aged-care industry has been identified by leaders in Victoria as a key contributor to the spread of Covid-19 in nursing homes, there is nothing in the budget to combat this problem.


Beyond aged care, there is little in this budget directed towards supporting Aboriginal and Torres Strait Islander people, migrants and refugees. In this year, almost as much money – $15.5 million – was put in the budget to support “delivery of Covid-19 safe Australia Day 2021 events” as was provided for Indigenous-specific health programs, $16.7 million.

Ben Phillips, director of the Australian National University’s Centre for Economic Policy Research, says he has some scepticism about the government’s $4 billion JobMaker Hiring Credit scheme – a wage subsidy for businesses that employ young workers. It will provide $200 a week to companies that create a new job for workers aged 16 to 29, and $100 a week for those aged 30 to 35, over a 12-month period. These payments top out at $10,400 for each new job created over the year.

“They tend not to be taken up by businesses as quickly as government thinks they will,” Phillips says.

The Australian Unemployed Workers’ Union (AUWU) is concerned this measure, and a suite of others, is geared towards establishing a regime that makes it near impossible for young job seekers to refuse seasonal fruit-picking work.

The federal government has provided $17.4 million starting from this financial year to pay “relocation assistance” to all job seekers in employment services “and to those who temporarily relocate to take up agriculture work”.

Under the current rules, welfare payments are suspended or terminated for people who refuse a reasonable job offer. If farmers use the wage subsidy program to even marginally boost pay and conditions, in tandem with new assistance encouraging young people to move for work, job network providers and the government will be more easily able to remove people from welfare.

“We are not thinking about the bigger structural problems over the longer term,” says AUWU spokesperson Kristin O’Connell. “Not only will this not set people up with good jobs and long-term careers, it threatens to remove them from their support networks at a time when people are really beaten down.”

Tuesday’s budget confirmed The Saturday Paper’s earlier reporting on the boom for Jobactive service providers, with almost $500 million expected to flow into the job placement system this financial year, and $2.6 billion over the next four years.

These figures take into account a forecast $1.4 billion saving over the same period, achieved by building an online-only “employment services platform”, which would place the most job-ready unemployed people out of reach of the vast network of outsourced job service providers.

“Anything that protects people from job agencies is positive but, again, none of this responds to the needs of the job seeker,” says O’Connell.

The new hiring credit scheme unlocks another revenue stream for job agencies, which will be eligible for placement bonuses for any person who enters work for a business that receives the weekly subsidy. The budget also uncaps places in the youth internships program, administered by job agencies and for which these companies receive bonuses.

Fewer than a third of job placements recorded since the employment services system began in 2015 are secure or ongoing. In its 2018-19 annual report, the Department of Employment, Skills, Small and Family Business said that “since its introduction in July 2015, Jobactive has achieved more than 1.37 million job placements, over 400,000 of them leading to sustainable employment”.

The Coalition has already reduced the rate of the coronavirus supplement – which is given to people receiving JobSeeker or other support payments – from $550 a fortnight to $250, and this is currently scheduled to finish at the end of December. For a budget designed to stimulate the economy through spending, this is the biggest concern, says Ben Phillips.

“At the very least the JobSeeker payment should have continued at the current rate,” he says. “The tax cuts mostly go into the hands of middle- and upper-income households and they tend to be doing more saving than spending at the moment.”

Last year, almost half of all people receiving unemployment payments were over 45, with the two largest single groups being women over 60 and women aged 45 to 49. They are also among the fastest-growing groups in the homeless population.

Tuesday’s budget shows a $41.3 million drop in funding through the National Housing and Homelessness Agreement, largely due to an end to supplementary wage support from the Commonwealth, which finishes on June 30 next year. The largest single drop for a state is Covid-19-ravaged Victoria, which will lose $15.6 million in just one year. New South Wales, by comparison, will lose just $4 million while Queensland and Western Australia will each receive about $7 million less.

The two biggest predictors of poor mental health are insecure housing – there is no new money for social housing in this budget – and lack of employment.

“Recessions kill the vulnerable,” says Professor Ian Hickie, co-director of the University of Sydney Brain and Mind Centre. “Those with fewer assets, less income and less opportunity will suffer. And it will be worse in the regions.”

The only new budget item for mental health is $100.8 million over two years to double the number of Medicare-subsidised psychology therapy sessions to 20 each calendar year. But this may actually do more harm than good, Hickie warns.

“This will do nothing to make things more equal; in fact, it may make things worse,” he says. “Waiting times will go up, we’ve seen that in Victoria, and psychologists will preferentially treat people who can afford to pay the gap.”

The National Disability Insurance Scheme received its first-ever overspend in this budget. But psychosocial participants in the scheme must use all the available sessions under Medicare before they can receive fully subsidised support. This means they will have to be able to pay the gap for 20 sessions instead of just 10.

Hickie says JobSeeker is the most important mental health measure, and the slated removal of the coronavirus supplement at the end of the year will plunge the country into crisis.

“The tsunami won’t hit us until next year, but the government has delayed structural reform again,” he says. “More lives will be lost to suicide than will be lost to the virus. We have been left in the waiting room again.”

This article was first published in the print edition of The Saturday Paper on October 10, 2020 as "Care deficit".

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