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Equality and inequality: two views: speech to The Sydney Institute.\n

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Senator Jacinta Collins

Shadow Minister for Children and Youth


Jacinta Collins Labor Senator for Victoria Shadow Minister for Children and Youth

Speech to The Sydney Institute EQUALITY AND INEQUALITY - TWO VIEWS

From any perspective, when considering equality and inequality there are three simple facts.

1. Most adult Australians are employed and most think that employment is important.

2. Most Australians live in families and most think those families are important.

3. Most Australians want secure, fair, reasonable and safe conditions of employment so that they may provide a standard of living for their family that enables them to live decently and with dignity.

Political parties that ignore these facts do so at their peril.

When I today consider the Labor view of equality and inequality it is important to consider where Labor comes from. Further, it is important to consider what and whom Labor stands for.

The Australian Labor Party is a genuine Labor Party. It is one of only a few in the world to which trade unions directly affiliate thus distinguishing it from other social democratic parties.

This is not something to be embarrassed about.

Australian Labor was a movement inspired by the need for fair and reasonable industrial and social wages, conditions and programs to improve the living standards and effect social participation amongst Australian workers and their families.

In many respects Australian Labor, throughout its history, has made many gains towards this objective.

Australian Labor achieved the eight-hour day, equal pay for work of equal value, superannuation, maternity and paternity leave, annual leave and the minimum wage.

It instigated Medicare, childcare assistance, housing assistance, education allowances and fairer family assistance.

Most of these initiatives are now taken for granted as essential contributions to workers' lives.

But unquestionably they are initiatives that protected and supported the working people of which Labor was born.

The Sydney Institute 22nd July 2003

Senator Jacinta Collins

Shadow Minister for Children and Youth


And unquestionably they have influenced greater equality amongst Australia’s working families.

A report conducted by Ann Harding, NATSEM, commissioned by the Smith Family and released in November 2001, Financial Disadvantage in Australia - 1990 to 2000, established that for the year 2000 the poverty line for a couple and two children was $416 per week, after the payment of tax and before the meeting of any housing costs.

The report showed that:

In the year 2000, 2432 000 or 13% of all Australians were living in poverty compared to 11.7% in 1990.

This figure comprised 1 688 00 adults and 743 000 children representing 12.3% of adults and 14.9% children.

In respect of children NATSEM figures show that overall poverty declined from a peak of 18.2% in 1981-82 to 13.3% in 1995 but then began to climb again with the figure in 2000 being 14.9%

Throughout the 1990’s there was a steady growth in adult poverty from 10.4% in 1990 to 12.2% in 2000.

The NATSEM report showed that after taking housing costs into account the largest single group of people living in poverty are those in working poor families. These are families where the level of income is low. Twenty-Four out of every hundred poor families was classified as working poor.

A 1996 Smith Family report, The Working Poor Dilemma, shows families earning less than $40 000 per anum spend most of their income on housing, health and transport. They are only about $20 per week (2.5% of all earned income) better off than if they were on the dole.

By contrast, a family on welfare may have access to public housing, rent assistance, health care cards and transport concessions, leaving more disposable cash. In return for participating in the workforce these families are sometimes no better off than those on social security.

The NATSEM data suggests that a much larger proportion of working families with children are living on incomes that are just above (less than 10% higher than) the relevant Henderson poverty line. For example, 12% of single wage earning couples with children have incomes below this slightly higher level, suggesting that a more substantial proportion of families are at risk of poverty. Henderson regarded those with incomes of less than 20% above the HPL as ‘poor’.

The statistics show that over the last decade the incidence of poverty has significantly increased, particularly amongst working families.

The Sydney Institute 22nd July 2003

Senator Jacinta Collins

Shadow Minister for Children and Youth


Working poor families represent almost one quarter of all poor families.

The Conservative agenda has transformed the nature of work and the consequences have been considerable.

It could be considered that the changes that have taken place in the area of work have plunged many individuals and families into serious economic difficulty.

There has been a decline in full time employment and the rise of non-traditional and more precarious employment practices. Casual employment, as a percentage of paid employment in Australia, has more than doubled. Permanency is increasingly been replaced by employment insecurity.

This has had serious consequences for working families because it means that in many instances the prime income earner does not have a full time job.

Notably, those most vulnerable to the growth in insecure employment are people entering the work force for the first time (mainly young people) and those re-entering the workforce after full - time parenting (mainly married women).

Further, the distribution of work in Australia is unequal. Increasingly, many Australian households could be described as ‘job rich’ meaning that more than one person in a household is employed and many could be described as ‘job poor’, where no one in a household is employed.

According to the FACS 2000 Annual Report, in June 1999 there were 441 700 children who had no parent in paid employment. This represents about 17% of all families with children.

Those who do have full time jobs and requirements to ‘do extra hours’ complain at the lack of time they have to interact with their partner and children. Poverty is more than an economic phenomenon; it also has a social element. Lack of time to participate in normal family activity should be seen as an indication of social and psychological poverty.

A two tiered labour market, polarised between high and low wage earners, has also emerged. This is precipitating increased social inequality and division.

Evidently, much inequality is the result of poor workplace practice. If we are to improve the level of equality in Australia then the Workplace Relations Act should be amended to encourage full time, permanent employment. Limitations should be placed upon the working of excessive hours. All workers, including young workers, should be entitled to a living wage.

However, influencing equality is not only about ensuring a fair and decent industrial wage. It is also about providing a fair and decent social wage. It is about providing for social capital and the common good.

The Sydney Institute 22nd July 2003

Senator Jacinta Collins

Shadow Minister for Children and Youth


The Labor view is that providing for social capital and the common good influences equality.

Liberals of the economic rationalist tradition will have an ideology set that is inconsistent with providing social capital.

Indeed, a late American Academic, Christopher Lasch, argued that economic rationalist policies destroy the family wage and the family structure and undermined the structures on which social capital depends.

If there is a Liberal Party tradition supporting the provision of social capital, as Greg Barnes has argued, it relates to the small ‘l’ belief in the role of government pursuing progressive social policy that will enhance equality.

Last week the Federal Treasurer, Peter Costello used the Sydney Institute to put his view of social capital. In considering his position political commentators have forgotten the Peter Costello of the Dollar Sweets case who presided over the demise of the small ‘l’ tradition in Victoria.

Peter Costello is a wolf is sheep’s clothing.

His failed attempt here at the Sydney Institute to reinvent himself, or to differentiate himself from John Howard, is not because he lacks fortitude, rigour or spine but because they are ultimately of the same ideology.

Lets look at some recent examples.

Recent changes in the “market” for children’s services trigger a chilling reminder of the John Howard and Peter Costello agenda for employment services.

The Government’s “radical experiment” for employment services, particularly the creation of the Job Network and the recent but slow death of any public provision via Employment National, aspired to an illusionary “free market”.

However, there were ongoing problems with Job Network I & II. Even with Job Network III, after the Government accepted that it was a managed market, problems linger and much social capital has been lost forever, particularly in regional Australia.

Does the Government now ask what sort of market do we want to foster quality and accessible services for our children?

Instead, a similar agenda seems to be occurring with children’s services at a national level.

For instance, when the Government finally accepted that intervention was necessary, albeit in a limited way in predominately coalition seats, it established rural incentives for private child care providers only.

The Sydney Institute 22nd July 2003

Senator Jacinta Collins

Shadow Minister for Children and Youth

The Sydney Institute 22nd July 2003


The Government is currently pursuing a level playing field approach to the provision of community based and private Child Care, refusing to acknowledge the importance of the community based sector in establishing and maintaining quality standards.

Meanwhile commercial providers, rather than creating additional places, seem to be devouring community based infrastructure that will be necessary for the development and maintenance of quality standards.

Further, the Government has, in the main, withdrawn from its national planning role allowing the ‘free market’ to determine supply.

Anecdotally, in some areas the market has reversed from 70% community based services to roughly 30%.

The implications of these changes haven’t been well considered. They endanger decades of social capital in the sector. There is no evidence of the ‘do no harm’ priority that Peter Costello purports. It will be much harder for government to regenerate the lost capital necessary to enhance equality.

The same arguments apply in many areas of social policy, for instance Medicare and Medibank Private, where the government has failed, adopting Peter Costello’s own words, to recognise the importance of the non-government sector and the positive values arising from it.

In conclusion:

In recent times we have heard of ‘New Labor’, more recently ‘Next Generation Labor’ but let’s avoid ‘Nouveau Labor’.

Labor has been accused of pandering to the politically correct causes of fashionable leftists at the expense of its foundation membership, working people.

Indeed, Kim Beazley Senior once said “Labor has turned its back on the cream of the working class in its rush to embrace the dregs of the middle class.”

However, as tempting as it is when one is in opposition to be populist Labor must prove that it is still the voice of those who established it.

That is those who fought for just and reasonable wages and conditions of employment and those who built our social capital.

Labor must continue to affect equality by providing for working people and their families with a fair and decent industrial and social wage.

Now more than ever working people need a Labor government.

Because now more than ever working people and their families need public policy that will affect equality.