Young or old: Who are the big winners from Budget 2020?

It seems older people were sufficiently affected to warrant the treasurer’s support.

Josh Frydenberg

It’s been a big year for federal Treasurer Josh Frydenberg, who has been tasked with keeping Australia afloat in unprecedented times.

So this budget, needless to say, was always going to be one of the most important budgets in the nation’s history.

Important in that it needed to be designed to cope with unprecedented government spending on welfare and on propping up businesses. Important in that it would show we could turn the proverbial poop into clay and mould a strong future.

It had the potential to be an actual game changer beyond that word being used as party rhetoric, one that could have steered the nation out of the pandemic and set us up for a future beyond a couple of big puddles and some new streetlights.

Instead, we got what The Guardian referred to as ‘the Afterpay budget’. That is, we buy debt now and pay it back later.

Sure, there are some good points and measures, but let’s start with you.

What’s in it for you?

Honestly, to answer that question, this could easily have been a two-word opinion piece.

Pensioners already know they didn’t get an Age Pension increase at the usual September indexation.

And to appease the masses of struggling pensioners deprived of their typical $3-$4 a week increase, the government spruiked that it would do something to help older Aussies cope with the increased costs of living in retirement.

And it did, in the form of two $250 payments – one in December and one in March 2021.

The cash payments totalling $500 will hit the bank accounts of around 5.1 million pensioners and eligible recipients.

Some will welcome this, and some will say it’s insulting.

But let’s do the maths on this.

If we divided that $500 by the weeks between now and 20 March 2021, when the next indexation occurs, pensioners would have had a weekly increase of around $16.

Not bad.

So, age pensioners could be considered winners of sorts.

Working older Australians, too, could be considered winners, especially if they fall into the high income tax bracket and will sup on the fruits of the government’s budget ‘centrepiece’ – fast-tracked tax cuts.

Just under 12 million Australians will like the tax cuts, especially the seven million or so who’ll get $2000 or more this year compared to the 2017-18 financial year.

The new changes mean upper income limits for the 19 per cent and 32.5 per cent brackets will increase from $37,000 to $45,000 per year and from $90,000 to $120,000 per year respectively and will be backdated to 1 July 2020.

If you ask the government, the tax cuts will somehow stimulate the economy and create 50,000 new jobs. If you ask 10 of Australia’s 49 leading economists, they might agree, but the remaining 39 are yet to be convinced.

And our friends at The Australia Institute have shown that investing $13 billion into services such as healthcare and education would have created 162,000 jobs across Australia – between seven and 12 times the number of jobs that are likely to be created by bringing forward the income tax cuts by a year.

Tax cuts only stimulate the economy if the money saved is then spent.

The real benefit of tax cuts for the government is political popularity, says political and economic journalist Ross Gittins, not pulling the country out of a recession.

And the only people who benefit are those who have jobs, says Australian Council of Social Service chief Dr Cassandra Goldie.

“People without paid work will see no benefit from the income tax cuts brought forward in today's budget, which mainly go to people who are lucky enough to have jobs,” she said.

“The government will need to do more to ensure that we are all in the recovery together.”

Still, working older Australians may also be considered winners.

But, what of the myriad older Australians who have lost jobs, had heavily reduced hours and now make up the majority of JobSeeker recipients?

On the top line, the Morrison government has done nothing for them.

The JobMaker scheme focuses on getting young Australians a job. The cut-off age for the JobMaker Hiring Credit is 35. The $1.2 billion apprentice wage subsidy scheme also focuses on young people.

When asked why the JobMaker Hiring Credit scheme was capped at 35, Mr Frydenberg said: “We settled on 35, because young people have been particularly impacted by this crisis, and also because of the history of previous recessions in Australia; in the 1980s and `90s, it took a while for jobs to come back.”

It seems the Treasurer doesn’t believe older people have been sufficiently impacted by the crisis to warrant support.

There is no measure to create jobs or training support for older people. Not even a permanent increase to the JobSeeker payment they will now rely on until they are eligible for the Age Pension.

In all fairness, Senator Anne Ruston said there would be more announcements about this. Unemployed older Aussies wait with bated breath.

Council of the Ageing Australia (COTA) chief Ian Yates is concerned about this lack of support for older workers.

“They are often the first made redundant, they find it very hard after economic crises to get back into the workforce at a time when they’re trying to support themselves and pay for their retirement,” he said.

“So we are concerned that having supplements for supporting young people without a parallel for older people will price older workers out and make their task in the economic recovery even harder.”

In the meantime, they can go fund themselves by accessing their own super, right?

What about self-funded retirees? Did they come out with anything?

The short answer is no. Certainly nothing that inspires. But please, prove me wrong.

"Retirees who partly or fully fund their own retirement have suffered significant income reductions as a result of the adverse economic impact COVID-19," said President of the Association of Independent Retirees Wayne Strandquist.

"These retirees rely on income from investments in the share market, property and fixed interest either through superannuation or private investment for their living expenses. They have been overlooked by the government as billions of dollars have been allocated to programs to stimulate employment and the economy."

What else is in the budget for you?

There will be an additional 23,000 home care places over four years to help chip away at the 100,000-plus waiting list (remember, 30,000 people on that list died last year waiting for a care), $11.3 million will be spent on dementia services and another $10.3m on improving the aged care workforce.

“The Australian Government is spending $1.6 billion on 23,000 new Home Care Packages for the next four financial years,” said the Combined Pensioners and Superannuants Association, which called the budget a “disappointing one for older people”.

“This will bring the total number of available packages to 188,000. Unfortunately, the number of people without packages is around 59,000. This means that, based on current figures, 36,000 people assessed as needing care will remain without it in four years’ time.”

Even superannuation reforms will only help younger people. Workers who switch jobs will now have their fund follow them to their new job, and a comparison tool will help members find the best fund for their needs.

Women, who have been most affected by the pandemic according to the statistics, will gain very little.

People who have lost their homes will join an ever-increasing wait list for public housing, and that list looks set to lengthen, with no mention of investment in public housing.

Investment in social housing would have killed two birds with one stone – delivering high-efficiency homes and creating desperately needed jobs for young and old.  

“Our pre-Budget submission proposal, the Social Housing Acceleration and Renovation Program (SHARP), would have delivered 30,000 high quality energy-efficient homes for people in need, and secured great jobs for thousands in regions and towns across Australia.” said Community Housing Industry Association chief Wendy Hayhurst.

On a side note, the majority of those 49 leading economists referred to earlier said that increasing the JobSeeker payment by $40 a day and creating more public housing were the two items at the top of their Budget wishlists. Neither eventuated.  

Overall, the Budget does a little bit for a few, looks after businesses and those with a job, will create jobs for younger people, assuming businesses spend on employees and don’t pocket their gains and will give an ailing economy a jab in the arm. But, many fear, it will not do nearly enough to get us out of the hole we’re in.

But let's end this on a positive note. Should we have a vaccine in 2021 and should everything go to plan and, as Adam Creighton writes, because it is a 'self-imposed recession', we could quickly bounce back once restrictions are lifted and confidence returns.

What do you think of the budget? Are you happy about the $500 handout? Has the government done enough to support you? Do you think it is a responsible budget?

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    COMMENTS

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    Buggsie
    7th Oct 2020
    11:05am
    This is an election budget, full of promises and short on real action. Its likely to fall apart if further health issues related to Covid19 occur. Business will take all it can get, keep as much as possible, employ as few casual workers as they can get away with, and pay as little as possible. Most people, if they have any commonsense, will save any gains to prepare for future lean times ahead. $500 per pensioner or others who qualify becomes less than $10 per week, equivalent to 2 cups of coffee or a schooner of beer. How insulting to we senior Australians. Ho hum, more of the same from a tired and worn out LNP government.
    Farside
    7th Oct 2020
    1:35pm
    at least you get the $500, others get zip.

    I disagree the LNP government is tired and worn out; it is just as strong on neocon ideology today as it was in 2014 despite its temporary dive into Keynesian economics.
    Justsane
    7th Oct 2020
    2:40pm
    Sorry to go off topic so early in the piece, Buggsie, but it is insulting to us senior Australians NOT to we senior Australians. You would say: 'It is insulting to us' NOT 'It is insulting to we'. The end bit doesn't make any difference. BTW, I think it is insulting too.
    Aussiefrog
    7th Oct 2020
    11:19am
    The article says:
    "There will be an additional 23,000 home care places over four years to help chip away at the 100,000-plus waiting list (remember, 30,000 people on that list died last year waiting for a care)"
    30,000 PEOPLE ON THAT LIST DIED LAST YEAR WAITING FOR A CARE!
    That's the way governments operate, red tape and lengthy wait, hoping you'll be 6 feet under before they have to act!
    Buggsie
    7th Oct 2020
    11:30am
    There are actually 130,000 people waiting on packages as of September this year. Most will die before sufficient funding is made available for an adequate supply of appropriate packages. The LNP govt priority seems to be to fund privately owned nursing homes operated by the old boys network and generating profits for the well off, rather than supporting people who want to remain in their own homes with family or other support.
    Aussiefrog
    7th Oct 2020
    11:36am
    I agree Buggsie, but the two main parties are a different side of the same coin, I wouldn't expect any better from labor!
    ozjames70
    8th Oct 2020
    8:58am
    Buggsie has hit it spot on. And all parties are as bad as one another. In to rape and pillage until they get dumped and then make out like Riley on their generous retirement packages and get work from those who they have helped while in 'power'.
    BigAl
    7th Oct 2020
    11:55am
    it doesn't matter what the government does greeedy Aussies will want more. It doesn't matter if you vote Liberal or Labor any more, its the same stupid insane policies. Might as well get a helicopter and fly over the country dropping money. If you include State Government debt, total government debt is now about $2T. Who cares - no one. No reward for working hard!! If you keep rewarding stupidity you'll get more or it in spades!! Whatever happened to tolerance, respect and humility?
    Mikko
    7th Oct 2020
    12:23pm
    Meanwhile farmers are plowing in fruit and veg crops because they can't get enough pickers, despite the high wages being offered. What's wrong with a work for the dole scheme to get those on Job Seeker to actually earn it and actually help the economy at the same timed. Too logical I guess.
    Farside
    7th Oct 2020
    1:41pm
    Mikko, do you have an example of the high wages being offered to entice seasonal pickers? I am aware some farmers have few problems harvesting their crops so what is different about the other farms?
    Rae
    7th Oct 2020
    5:34pm
    The proper farms supply decent accommodation, have families on farm and pay between $25 and $28 an hour.

    Where my son worked Danish students came every year telling their friends about it and had a great time.

    It's the logistics and job providers do not find jobs. The labour hire firms need to organise locals the same they did for backpackers.
    floss
    7th Oct 2020
    12:55pm
    Self funded Retirees have really suffered this year my super pension has taken a nose dive but that is to be expected, my fault for not living the good life instead of working hard.
    Attagirl
    7th Oct 2020
    4:14pm
    Totally agree. It does't pay to be a responsible citizen in Australia.
    Rae
    7th Oct 2020
    5:43pm
    Yes it's annoying we saved when others spent and get no support. You should check out Centrelink though as you may be eligible for some help it never hurts to ask.
    Mariner
    7th Oct 2020
    10:28pm
    Rae - some people just do not want Centrelink involved because they do not want to be called welfare recipients. We were not called that when starting work at 16. They were old age pensioners and we were promised that pension at 65 for men and 60 for women and no asset or means test. Was all changed in the 80s when superannuation was started. Still some oldies rather go without than having to approach "welfare". I just got used to it and naming me a welfare recipient makes no difference to me. I have more spending money than some SFR mates. To each his/her own.
    Hardworker
    7th Oct 2020
    12:59pm
    As usual the LNP has left out certain sections of the community who are also the most vulnerable and we need to ask WHY? Why leave out older workers who can't get jobs? If in your earlier working life you needed to pay off a house, put children through school etc. etc. and planned to fast-track superannuation later in life when you could more appropriately afford to, how can they now do that if they have lost their jobs? Not to mention those couples who left it too late in life to get out of the intolerable relationships they were in. There is no time left to save and get ahead before retirement. This Govt just plays the blame game and do not take 'life' into account. They only want to look good to the wealthy who put them in power.
    KSS
    7th Oct 2020
    1:20pm
    You mean 'life happens' Hardworker. Well tough. Super is a life long proposition and meant to be contributed to from the first day of your working life. Adding an extra $5-10 a week (yes forgo a couple of beers or coffees) adds up over a lifetime. When did retirement savings become a Government responsibility?

    For generations people were in relationships, had children, put them through school, bought homes and ran a budget to do so. And guess what, people got divorced or partners died too. What makes this generation any different? When did relationship issues become a Government responsibility?

    We can all parade the life events we have already lived but ultimately we are all responsibile for ourselves. Government aid and welfare should not be a lifestyle choice but a genuine safety net for those genuinely unable to help themselves. That means get those under 35s (or indeed anyone who wants to go at any age) out into farms picking fruit now adding to their super now, working now.
    Circum
    7th Oct 2020
    4:07pm
    Agree with you KSS.Life happens.However not sure about the fruit picking alternative.As a youngster I tried that with a few Uni mates.After half a days work I filled up my large wooden crate worth $7 to me.Then a union guy comes arrives and says Ok anyone who wants to continue working needs to join up with the union,Thats $12 thanks.Some quick maths told me thats $2 net I would make for the day.So that was my first and last time pear picking.
    Hardworker
    7th Oct 2020
    5:39pm
    KSS why don't you read comments properly instead of going off on your own little tangent. We're talking about the OLDER generation, not THIS generation. I too put money aside in Super even though I was doing it tough. Yes there are those who do not spend wisely but there are also others who try hard but get a lot of hard knocks in life with ill health, job losses and business failures etc. I am anything but religious but you have no compassion and no understanding. And as for fruit picking it's not as simple as it sounds. No appropriate accommodation, lousy pay, sometimes back-breaking work, unwanted attention to females by sleazy males and some fruit picking groups controlled by the Mafia. This information comes from people I know who have been there, done that.
    KSS
    7th Oct 2020
    7:51pm
    And yet Hardworker, those farm jobs are good enough for visiting backpackers year after year while Austrlians, fit and hrealthy turn their noses up because it is all too hard! Get real Hardworker.
    Anonymous
    8th Oct 2020
    3:24pm
    KSS, I agree with much of what you say, but the government has declared that responsibility and self-sufficiency are evil and to be punished and has apparently decided that everyone should be poor and dependant in old age. It's not that the population has randomly decided to be irresponsible - but rather that they have been forced to recognize that work and saving doesn't pay, but squealing for handouts does. And Labor is worse than LNP when it comes to rewarding irresponsible lifestyles and punishing workers and savers.

    As for those farm jobs being good enough for visiting backpackers - well, yes, since it's a way for them to see the world and many have other income or wealthy families anyway so the money they earn is only for daily expenses. Aussies may well have nothing else, and no future, and frankly, I don't see why they should work for peanuts in often appalling conditions when they will suffer penalty for earning and certainly harsh penalty for saving or investing to improve their circumstances. Once again, it's the government to blame. I know plenty who rejected work opportunities because working didn't benefit them. By the time they cover travel costs, work clothing and lunches, and other incidentals, they are far better off at home on Newstart selling some home grown plants or craftwork for cash. Or, better still, do as many do and figure a way to claim disability (mental illness is easy enough to fake, it seems!).

    We have to stop this crazy idea that welfare is a safety net, because that just encourages people to be or appear needy so they access it, and discourages endeavour that, for many, will never pay off.
    KSS
    7th Oct 2020
    1:07pm
    This is a typical response to be expected from this site. One BIG whinge from beginning to end.

    "It seems the Treasurer doesn’t believe older people have been sufficiently impacted by the crisis to warrant support." And where does this come from? Day after day, week after week on this site people have been saying that the 'young' need help to get jobs, education, homes. Well now they have the opportunities being provided and still this writer whinges and whines.

    And lets not get lost in the mire and grabby hands still out for more. Yes those older people most affected are the self-funded retirees. They have NOT received the extra $2000 handouts and on top of that their investments have declined to levels where their income may well be less than the age pension. Yes they can sell assets and yes they may own their home but to think they have not suffered is quite wrong. They are in many ways worse off than those on the age pension. The way to help them is not throw money at them. Its to get people back into jobs and get the economy back on track. And then there is the usual confusing of State and Federal responsibilities. Whinging about social housing is not a Federal issue. The States and local councils have thet responsibility!

    And one more thing, the debt being incurred is unprecidented. The saving factor is that money borrowed now to pay for all this is also at unprecidented low interest levels and those levels are locked in at today's rates. This and because Australia was in a reasonably good position going into the pandemic, means that Australia is doing far better than other comparable countries and has an opportunity to rebound quickly.

    Yes there still needs to be proper reform of the entire tax system, health and aged care, child care, education and anything else you care to mention, but now is not the time to tackle all these things at once.
    Sundays
    7th Oct 2020
    2:05pm
    KSS, you’re wrong about social housing. The States have responsibility, but joint funding has always come from the Federal Government. Over time, the Fderal Government has reduced their share. An increase in money for social housing, would have assisted the economy by more,jobs and helped the homeless including older women
    KSS
    7th Oct 2020
    2:19pm
    And states have sold off housing stock and not replaced it!
    LeonYLC
    8th Oct 2020
    7:54am
    Thanks for your insightful comments KSS. I'm wondering. Are you on an Age Pension? Are you over 55 and out of a job? Do you own your home?
    ozjames70
    8th Oct 2020
    9:24am
    KSS, it seems you live in a different world to many. Consider for a moment those who have built this country and contributed their whole lives.
    Some were even still working part time to fund their retirement, often forgoing part of the OAP. For many this was to help in paying off mortgages so not to add more people to the accommodation crisis.
    Then Wham! COVID hits and they get laid off. Centrelink says no, you are at pension age, so you can't get JobSeeker, you're automatically on OAP. And feel good you're supported.
    If you were a business, you could claim back your losses, but as a pensioner, you can't claim back the taxes you've paid, even though you've now been dumped in a heap.
    The politicians are pitting groups of Australians against each other the way any 'successful' despot does, so now let's look at how we politicians can take more off you. They signed the Lima Agreement to make Australia poorer and they are hell-bent on doing so. Sad to see they have so many naïve supporters. Your time will come. They'll wipe out group by group until the remaining few are just like them.
    Farside
    7th Oct 2020
    1:32pm
    seems to depend upon whom are the "older people" when YLC states "It seems older people were sufficiently affected to warrant the treasurer’s support."
    Hawkeye
    8th Oct 2020
    1:47am
    Farside, you need to get the glasses on mate.
    Or do you suffer from selective vision?

    YLC actually states, in Para 33,
    "It seems the Treasurer doesn’t believe older people have been sufficiently impacted by the crisis to warrant support"
    which has the complete opposite meaning of what you accuse them of stating.
    Farside
    8th Oct 2020
    3:50pm
    Hawkeye, scroll to the top of the page and read the sub-headline. It's in large enough typeface so you will not need glasses. I simply cut and paste the YLC statement.
    floss
    7th Oct 2020
    1:33pm
    And thus ends the sermon from Father KSS.
    KSS
    7th Oct 2020
    2:19pm
    Bless you my child!
    Mariner
    7th Oct 2020
    10:30pm
    Amen
    Fair Dinkum
    7th Oct 2020
    3:21pm
    once again a lot of self funded retires are worse of then pensioners so what did they get a big fat OOO. self funded retires should get the same discounts on there rates ect that pensioners get so thank you Mr treasurer for giving me nothing and letting me live on an equivalent amount as the age pensioner without the benefits.
    BigAl
    7th Oct 2020
    4:43pm
    Totally agree. As I am a self funded retiree also I get absolutely 0. The government doesn't reward good behavior and personal responsibility. When are kids going to be taught life skills.
    Circum
    7th Oct 2020
    5:45pm
    Big Al ,The government is teaching kids life skills.By observation kids are learning to not save too much (Josh rubs his hands ),enjoy life while they can and that the government will assist them as long as they havent saved too much
    Mariner
    7th Oct 2020
    10:34pm
    Never be self funded as it defeats the purpose. Better having a good life spending during your productive years and then take as much as you can in your declining years. THAT is the lesson the young are learning from our behavior today. I am glad I stopped work in my 50s.
    Anonymous
    8th Oct 2020
    11:17pm
    Yes, but the stupid politicians still think they save money by being mean and cruel. They are in for a shock as more of the aged population wakes up and fewer and fewer retire with savings.
    popster
    7th Oct 2020
    6:28pm
    The wingers are out in force, what do I get gimme gimme gimme. You know people there are three levels of Government in this country. What are the Sates doing? Oh that's right Victoria has had the joint locked up for 10 months. Qld created 174 jobs last Quarter, WA that's right keep the borders shut to all those filthy tourists from the eastern states. Our economy is fine Jack you can go to hell. Same with Qld, lock up the borders and don't let any tourists in. Tasmania the same. SA to a lesser extent. For goodness sake the Feds have only so much they can distribute. They also have had massive income reduced. Chairman Dan saw to that with one Quarter of Federal Govt revenue out the window. If many of you paid attention, the Feds openly said via the PM and Treasurer that the States had to do their fair share of lifting as well. This budget reflects that point to some degree. Having said that, this budget is mainly aimed at getting business firing so jobs can be created and people get back to earning sooner that later. Given the shocking results on this country and what it had to cope with during the pandemic it is a way forward and we must not forget, there is always tweaking going on and another budget is handed down every year. Finally any budget has to be practical and affordable. I would sooner have a budget based on those principles than not.
    Circum
    7th Oct 2020
    7:55pm
    Think you meant whingers not wingers which is a sporting position.
    popster
    8th Oct 2020
    12:26pm
    Thank you Circum, you are spot on. Just noticed a couple of others as well. LOL
    Eddy
    7th Oct 2020
    8:18pm
    As a tax-paying superannuant I will get the benefit of a tax cut of about $1000 per year. Problem is until our lives get back to 'normal' we have nothing on which to spend the extra money. Shops are closed, theatres and restaurants are closed, no sport, and nobody anywhere wants Melburnians to visit. So much for spending our way out of recession.
    Mariner
    7th Oct 2020
    10:35pm
    Buy the stuff you want on line Eddy! Never had any problems myself getting rid of some money.
    Eddy
    8th Oct 2020
    6:37pm
    Mariner, I have tried 'on-line shopping' and do not like it for two main reasons. One, I like to see, smell, feel, hold what I am buying. Secondly so many Australian on-line sites have items shipped from overseas which kind of negates my preference to buy Australian or support Australian businesses. Thirdly I prefer not to contribute to Mr 'Amazons' (or others with similar business models) wealth.
    That was 3 reasons and I could easily think of more if I applied my mind. We have been buying our groceries from Woolies on-line since March and have computer supplies on-line from JB HiFi.
    Anonymous
    8th Oct 2020
    11:16pm
    I agree, Eddy. Some things you can buy online, but furniture, decor items, clothing, shoes... nah! You need to see and feel it, try on clothes and shoes and see how they fit and if they feel comfortable and look good on.
    Fair Dinkum
    9th Oct 2020
    5:22pm
    pensioners compared to some self funded retires are better off because they get concessions on rates rego electricity and other items. Some SFR incomes are less or equivalent to the pension since dividends are not being paid term deposits almost nil so pensioners you are not doing to bad


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