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St Vincent de Paul warns of a permanent underclass because cost of health services, education and transport are rising out of proportion to wages.

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Monday 5 April 2004

St Vincent de Paul warns of a permanent underclass because cost of health services, education and transport are rising out of proportion to wages


TONY E ASTLEY: One of Australia's biggest charities says the Federal Government and the Opposition are doing little to stop people becoming poorer. The St Vincent de Paul Society says if current Government and Labor policies continue on the same path a permanent underclass will emerge. It points to the costs of essentials like health, education and transport all rising out of proportion to wages. 


Hamish Fitzsimmons reports. 


HAMISH FITZSIMMONS: According to the President of St Vincent de Paul's Social Justice Committee Terry McCarthy, the Prime Minister John Howard is wrong when he says people are not getting poorer. 


TERRY MCCARTHY: Over the last five years, the bottom 20 per cent of Australians have had a weekly increase overall of 75 cents a week. Given that the costs that they have to meet, with education having gone up in the same period by 173 per cent, in excess of CPI, health costs gone up in excess of 98 per cent ahead of CPI, hospital, dental, public transport, all gone up well in excess of 100 per cent of CPI. The simple fact is that they are just getting poorer and poorer. 


HAMISH FITZSIMMONS: The St Vincent de Paul Society says there's a poverty trap that people are finding difficult to break out of 


Terry McCarthy. 


TERRY MCCARTHY: And at the same time, those 3-and-a-half million and I would add to that the other million or more who live on less than $500 a week is that their chances of being able to escape from that poverty and deprivation is very remote. 


HAMISH FITZSIMMONS: Don't people though, have a better standard of living now than they did ten years ago? 


TERRY MCCARTHY: I think some of us do, I think I do, I think you do perhaps and I think people like us do, but I certainly do not agree that the people who are the bottom end of the scale and that's about 20 per cent of the population, they certainly don't. 


HAMISH ROBERTSON: The charity also says Labor's emphasis on building local community relationships will do little to halt the decline in the standard of living for people with household incomes of $400 or less. 


But other research disputes the poverty trap argument. The Household, Income and Labour Dynamics in Australia or HILDA Survey found there is much mobility between economic groups.  


And the Minister for Family and Community Services Senator Kaye Patterson says earnings have risen more than the report indicates. 


KAYE PATTERSON: Under this government, average weekly ordinary time earnings for a full time adult male are currently $993. This is a real increase of over $140 per week since 1996, a total growth of 17.1 per cent. 


HAMISH FITZSIMMONS: What about the claims about mobility between economic groups. St Vincent de Paul Society says there's a poverty trap, but other research like the HILDA survey, would seem to indicate that this is not the case. 


KAYE PATTERSON: Well, HILDA's survey indicates that there is some movement both from people who are in the lower income group upwards and some people in the higher income group downwards. What we hope to establish through the HILDA report, is those people who don't move, what are the factors? 


TONY EASTLEY: The Minister for Family and Community Services, Senator Kaye Patterson, speaking there to Hamish Fitzsimmons.