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Advance Australia fair? To recover from COVID, reset social policy

We need a reset of social policy, especially for those closer to the bottom of the income spectrum, who have been forced to live hand to mouth – the poor, the homeless, many of our aged and disabled, those who were already struggling pre-COVID. We need a social recovery strategy that validates the claims to egalitarianism, and demonstrates the government’s rejection of naive Thatcherism and Reaganism. This is not an opportunity to foster Trump-style social division.

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There are at least five key elements for such a strategy: a clear commitment to sustain JobSeeker at an appropriate level, and JobKeeper in the most disadvantaged industries; delivery of about 100,000 home-care packages to those on the waiting list; a large-scale national program on social/affordable housing; universal free childcare for all children up to, say, the age of five; and policies to recognise the particular disadvantage of Indigenous Australians.

The traditional Coalition response, beyond stereotypes and prejudices, is to worry about the rapid expansion of the size of government. How can it be afforded? But the debate has moved on from the facile “debt and deficits” drama. The reality of COVID has been, in any case, a significant increase in the role and influence of government, the debt for which can be cheaply funded.

Our government debt is low by international standards and manageable, and it is possible for AAA-rated countries such as Australia to borrow long-term at historically low interest rates. Austria, for instance, recently borrowed €2 billion for 100 years at 0.88 per cent.

And remember, these are areas of government neglect and some clear market failure, in part driven by profit motives and vested interests in the provision of essential services.

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The aged have been disproportionately affected by COVID. The royal commission had already exposed alarming failures by aged care providers; the pandemic has exposed them further. The government should commit to a complete reset of the aged care sector based on the commission’s recommendations.

Home care packages were designed to give the aged a choice to remain longer in their own homes, but a blowout in the waiting list is a national disgrace. The government’s recent sop of funding to take just a few thousand off the list was little short of offensive.

A national scheme for affordable and public housing – shovel-ready work – could easily be financed through special social impact bonds, which would be attractive to individuals, institutions, and philanthropists.

One of the most curious and indefensible decisions so far in the recovery is the government’s decision to end free childcare, and to cut JobKeeper to that sector before all others, especially when about 97 per cent of childcare workers are women. The Recovery from COVID is a unique opportunity get childcare right. Given its importance to the capacity to work, it should be guaranteed for children up to five, and linked to a pre-school and early-learning strategy. The cost would be repaid manifold in broader societal benefits in years to come.

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And COVID recovery offers a real chance to accelerate Indigenous programs to close the gaps in education, training and employment opportunities.

The Morrison government has much to do to live down the perception that it mostly governs for the “top end of town” and its mates. If it was this aspect of Thatcher and Reagan’s reputations against which Morrison baulked, resetting social policy would go some way to laying those perceptions to rest.

John Hewson is a professor at the Crawford School of Public Policy, ANU, and a former Liberal opposition leader.

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