Number One Welfare State in the World


Australia could be described as the number one welfare state in the world, with the percentage of GDP going to welfare setting the record, ahead of former communist nations and traditional welfare states like Sweden – this is clearly unsustainable. And yet the government is being urged to add another 20 weeks of taxpayer funded parental leave to the equation.

Some 42 per cent of the nation’s 9.7 million families actually receive more in handouts than they pay in income tax. This situation is causing damage to both the welfare recipients and the community at large and is encouraging a culture of dependency.

Furthermore, just consider the massive administration costs of one department (ATO) collecting the income tax of 42 per cent of families and another army of bureaucrats (Centrelink) returning it via a complicated and intrusive system of assessing eligibility and a complex system of administering the payments.

Notwithstanding that there is widespread support for the concept of self reliance, government policy has been going the other way for years. Some forty five years ago only 3 per cent of working age adults depended on welfare; now it is 17 per cent. At that time there were 22 people workers to support each working age person living on welfare. That ratio (called the dependency ratio) has now degenerated to five workers to support one.

We need to concentrate on how to prevent people from becoming needy rather than how to give them more money; that is, how to become more self reliant. There needs to be conditions attached to welfare to encourage people to return to work. It is wrong to consider welfare an unconditional right and oppose a system where penalties apply for those who refuse to work.

Increased welfare must mean higher taxes and very few Australians would support that. I expect, though, that they would support welfare recipients being required to be obligated, in some way, to the taxpayers who carry them.