What to do with the "undeserving poor"?

Bob Briton

The chorus of moralising and tut tutting that accompanied the 
Federal Government's payment of the first of the baby bonuses 
last week and a lump sum boost of the Family Tax Benefit (Part A) 
the week before has not yet fully subsided. An unedifying debate 
has sprung up about the alleged social consequences of the 
payments, with "both" sides claiming to have the interests of the 
disadvantaged at heart.

On one side we have the Howard Government. It has resisted just 
about every wage claim, even the most modest increase in the 
wages of the lowest paid, done its level best to put as much of 
the cost for deteriorating social services like health and 
education into the "user pays basket". It has rewarded the rich 
in the community and attacked any union that looked like 
resisting the theft of the wealth produced by workers. Any 
suggestion of a deviation from this strategy has been met with 
warnings that the allegedly robust Australian economy simply 
could not afford it.

However, with a Federal Election due in the next few months, 
Family and Community Services Minister Kay Patterson was able to 
announce that the government's good management of the economy has 
enabled it to return some bigger than usual dividends. From July 
1, mothers of newborns will receive a $3000 "baby bonus". Parents 
of dependent children who qualify for the means-tested Family Tax 
Benefit (A) (FTB would receive a lump sum payment of $600 for 
each child.

What is more, Centrelink has been instructed to ignore 
overpayments of the FTB. Even under considerable political 
pressure, Howard has only gone as far as to say that recipients 
of overpayments should be "encouraged" to hand the money back. He 
has promised to maintain this easygoing approach even after the 
elections.

All heart

The contrast with the Government's usual stance on these matters 
could not be more marked. Amanda Vanstone, the previous minister 
for Family and Community Services, once said that families 
receiving the FTB must get used to receiving a boost one year and 
paying it back the next. Parents whose patently inadequate 
incomes strayed slightly above the FTB (A) threshold — often 
because of the vagaries of casual working hours — have received 
hefty bills in recent years for overpaid benefits and not much 
understanding from Centrelink.

Anyone who has ever had to repay some overpaid unemployment or 
other Centrelink benefit would also be surprised at the 
Government's new "have a nice day" policy.

The cynicism of the Howard Government is to be expected, though 
not excused. The payments are a blatant election sweetener 
flowing from what was dubbed the "Breeders' Budget" of last May. 
The payments have been carefully planned to draw people's 
attention away from the government's failure to legislate for 
substantial "family friendly" policies like maternity leave or 
regular working hours and secure jobs.

What IS surprising in this debate is the frenzy of foreboding 
from the "other" side. It is needless to point out that the 
Parliamentary Labor Party is not the outfit it was in the '70s 
when it introduced long overdue reforms like the Family Law Court 
and the Single Parent Benefit. However, the debate over the baby 
bonus and the FTB lump sum payments has revealed just how far 
Labor will go to project a conservative image in keeping with its 
essentially conservative politics.

Holier than thou

"Opposition" family and community services spokesman Wayne Swan 
has chastised Howard for his lack of rigour in collecting 
overpayments: "If Mr Howard is serious he will rescind the 
directive of Senator Patterson and give explicit instructions to 
Centrelink to take the money when it is returned from people who 
have been innocently overpaid".

Mark Latham denies Government claims that only 2200 families will 
be overpaid and insists that the number is closer to 20,000. The 
government's generosity casts doubt on its claim to economic 
"responsibility", according to Mr Latham. Presumably, a future 
Latham Government would hound people to return the $600 
overpayments regardless of whether they had gone to pay off some 
of the family's debt, bought children's clothes or simply tipped 
down the slot of a poker machine.

Labor has fallen into line with wowsers of all descriptions in 
its comments about the lump sum payments. According to this mode 
of thinking, the poor do not know how to manage their money. That 
is why they are poor. If you give them a lot of money they will 
waste it on luxury items above their station. If you give them 
just a little extra, it is more likely that they will spend it on 
cheaper things like food and clothes for the children. In line 
with this thinking, Labor advocates giving the benefit in 
negligibly small, joyless instalments.

Saving the poor from themselves

The media has got behind this campaign. In Adelaide No Pokies MLC 
Nick Xenophon was quoted in The Advertiser last Saturday, 
pointing out that an extra $1.616 million has been splurged on 
poker machines since the payments were made. Electrical retailers 
The Good Guys note a spike in the sale of plasma TVs since the 
fateful payments were handed over.

However, some doubt creeps over this "evidence" when a quick 
check of the stores is conducted. The cheapest plasma TV in The 
Good Guys' shops is $4,999 and the dearest is around $10,000. 
That is the equivalent of between eight and 16 kids-worth of FTB 
lump sum payment in the old maths! Probably more typical — 
though less sensational — would be the example of Leanne Steicke 
who bought a fridge for her family's use.

The increase in spending resulting from the lump sums is said to 
be behind an unexpected rise in retail sales for the month of 
June. An increase of between five and six per cent was expected 
but it turned out to be between seven and eight per cent. Over 
half of the increase was attributed to food sales.

A very small item in the same paper noted that Anglicare's four 
charity outlets were nearly deserted last week. Normally, between 
30 and 40 people would queue for food every day. Last week there 
were only two or three. Anglicare spokesman Peter Bleby made the 
following observation about the lump sum payment: "Even though it 
is short term and it will all be spent, that money was able to 
help the poorest people to get by for a while. It gave them some 
short-term welcome relief."

While the thought of what the poor might do with the $600 lump 
sum has caused some heartburn for "right thinking" people in the 
community, the $3000 "baby bonus" has almost sent them into 
cardiac arrest.

Barry Maley and Peter Saunders of the reactionary Centre for 
Independent Studies wrote a piece for The Australian last week 
that complains that the Howard Government is betraying its 
conservative roots. The "baby bonus" would further the decay of 
society caused (in their opinion) by generosity of the welfare 
state to young, often single mothers.

Minders of morality

They quote American "libertarian" Charles Murray who says, 
"government payments unintentionally encourage various forms of 
irresponsibility or self-destructive behaviour". Maley and 
Saunders fear that the $3000 bonus might cause "young girls of 
relatively low education with poor career prospects" to decide to 
get pregnant as a short-term fix, as a way out of unemployment or 
the poverty associated with McJobs. 

Maley and Saunders do not question why the girls should be poorly 
educated or have no prospects or no jobs at all. They decry the 
payment of the "baby bonus" and even the single parent benefit 
itself. Although it would be bad form to put it in print, they 
obviously blame the Government for not allowing the young mothers 
to starve.

Latham agrees that the lump sum will cause a surge in teen 
pregnancies. So does Natasha Stott Despoja of the Democrats. They 
want the government to chop this payment into undetectable 
instalments, too. The force of these conservative arguments has 
seen Ms Patterson to introduce Centrelink guidelines that will 
compel mothers under 16 years to attend an interview to assess 
the appropriateness of paying the bonus in one lump sum. Other 
"vulnerable" people could be quizzed by social workers to 
determine if they, too, need to be protected from such a large 
amount of money.

George Orwell observed in Road to Wigan Pier that middle 
class "socialists" travelling to the grimy industrial towns of 
the north of England in the 1930s to "convert" the poor were 
usually unable to get onto the same wavelength as the people they 
so clearly pitied. They could not understand why the parents of a 
poor family would buy a bag of hot chips when, for the same 
money, they could buy a box of wholesome vegetables.

They could not understand that before permanently poor people 
will consider the long-term consequences of their health or the 
long-term of anything else, they need to have a place in society. 
From that place they need to have the realistic prospect of 
obtaining for themselves what is taken for granted by large 
sections of the community: secure housing, decent health and 
education, clothing, reasonable levels of consumption, travel, 
entertainment, etc.

However, the baby makers in our society — the so-called 
generation Y of 18 to 24-year-olds — know they have been gypped. 
Only 12 per cent of them have no debt by the age of 22. Many owe 
huge HECS debts. A survey by accounting body Certified Practicing 
Accountants says that 73 per cent of young people believe that it 
will be extremely hard to save for a comfortable retirement. Most 
have given up on the idea of owning a house. They know that one 
in three people in NSW live with housing stress where more than 
30 percent of household income goes on housing. The situation is 
worse for renters with worse still to come.

Generation Y is not stupid. They do not believe the fudged 
unemployment figures and are aware of the gloomy truth of the job 
market. Every now and again some light is thrown on the real 
situation. For example, last week it was revealed that the number 
of those experiencing long-term unemployment of more than five 
years(!) has increased by two thirds since 1999 — up from 75,000 
to 127,000 this year.

To the Mark Lathams, Wayne Swans and Natash Stott Despojas of 
this world: if the idea of the "undeserving poor" buying 
electrical goods or alcohol as well as some extra food and 
clothing with their lump sums offends you, if you wish they would 
put the money towards some more worthwhile purpose, then get 
cracking! Get to work on a radical makeover of society that will 
provide the jobs, the security and the sort of income that will 
stop the behaviour you find so disturbing.