EXPERT REACTION: Federal Budget 2019-20

There are some useful contributions in the budget to tackle short term energy costs issues and a couple of other contributions to energy infrastructure. However the federal budget is not really the natural place for making good energy and climate policy. Energy infrastructure is largely in the jurisdiction of the states and expenditure on energy and electricity infrastructure in particular has been delegated to the market and to the private sector and economic regulators such as the ACCC and the AER. The key energy and climate policy space needs a coherent set of integrated energy market reform policies together with a strong emission reduction scheme. Whether the latter is a baseline and credit scheme such as Finkel’s Clean Energy Target or a more standard carbon pricing scheme will mostly be something for the politicians after the election. However a broad-based mechanism for an orderly ramp down in fossil based electricity generation and transport emissions that meets climate science based trajectories is imperative. I don’t expect to see this happen until after the election.

All efforts to attract, retain and progress girls and women in STEMM are crucial in creating a truly innovative and creative workforce in Australia.  The types of initiatives announced in the budget ($3.4m STEMM package) take the first steps to enable more girls and women to be engaged in STEMM, and to achieve their ambitious aspirations.
 
All businesses will benefit from diversity, it allows them to embrace the full potential of Australia’s entire workforce, and enable them to respond to change, complexity and to be sustainable.
 
The $1.8m commitment to extend the Science in Australia Gender Equity (SAGE) initiative in the higher education and research sectors is a strong and welcome message of government support for the STEMM sector, which will facilitate the implementation of the important Athena Swan initiatives across Australian universities.

The $2bn for the Climate Solutions Fund has now been budgeted to extend over 15 years instead of 10. This is not much money for what is the central pillar of the Government’s climate policy.
 
The budget balance would be in a better position if Australia had retained its former carbon price, instead of scrapping it and moving to a subsidy-based approach. Emissions would be lower, and we would be in a much better position to move forward with emissions reductions over coming years.

The Australian Academy of Science’s statement that CSIRO has received a $21.5M funding reduction over the forward estimates is incorrect. The Government’s investment in CSIRO across this period remains consistent with previous levels, increasing by over $6m in line with indexation. This funding will continue to be directed towards innovative science and technology to solve Australia’s greatest challenges.

Based on the information available, the Australian Academy of Science’s media release in response to the Federal Budget stated that there had been cuts of $21.5 million over the forward estimates to the CSIRO. This analysis was derived by comparing the 2019/20 budget with the previous year’s budget over the forward estimates period.

Further information provided subsequently has clarified that the budget was referring to a reduction in the CSIRO’s total expenses, not a reduction in Government funding to CSIRO. The Academy understands that the Government’s investment in CSIRO across this period remains consistent with previous levels, increasing by over $6 million in line with indexation.

It’s great to see the Government continuing to commit to fully establishing a $20B Medical Research Future Fund, on time and as promised, by 2020-21. The 10-year plan for the fund will provide long-term stability and allow investments in projects with longer time frames, allowing projects to deliver significant health and economic benefits for the nation. We look forward to seeing competitive processes put in place to make sure we get most from this funding opportunity.

Australia is one of the lowest investors in illness prevention of any OECD nation at less than 2% of our national health spending

Two of our biggest killers were conspicuous by their absence in the Budget - obesity and alcohol.
 
Nonetheless this Budget has some valuable and welcome investments:

• Extension of the Child Dental Benefits Schedule ($1 Billion)
• Mental health and suicide prevention commitments ($736M) - these are sorely needed
• Research investment via the Medical Research Future Fund (MRFF) guarantees ($260M over 10 years) for preventive and public health research plus another $160M in Indigenous health research over 11 years
• Global health research focused on antimicrobial resistance ($28M) is welcome
• A tobacco control campaign at $20M over 4 years is a starting point, but smoking remains one of our biggest killers. We need to do much more to kick start serious tobacco control efforts.
• Promoting social inclusion and being physically active via sports ($23.6M)
• Take Home Naloxone Program ($72M)

 
Spending on good health care, effective drugs and research is important and essential. But a continual downward spiral in real prevention is a trend we must seriously address.
 
We should have ambitious goals for real life-long health. To reach that point we need major action to contain the explosion of obesity and overweight in our community.
 
We need to do so much more to limit the harms of misuse of alcohol. And we have a massive gap to close regarding Aboriginal and Torres Strait Islander Australians.
 
But the long-term wellbeing of the community has not figured sufficiently in this budget.
 
Like inaction on climate change, the budget does little to prevent a future illness tsunami.

An economic plan focused ‘cranes, hard hats and heavy machinery’ is essentially a budget for the boys.

The centerpiece expenditure item – a ten-year injection of $100 billion on infrastructure – will deliver widespread benefits for everyone, especially commuters. But the economic benefits will not be evenly spread across men and women.

More roads, rails and airport will heavily prop up the construction industry, fuelling jobs and wage growth for mainly men.

Extra funding for female-dominated sectors – mental health, residential aged care, hospitals and schools – will help these services cater to swelling demand. But it is unlikely to translate into better wages for these workers.

Funding for pre-school places ($453 million in the next year) and support for carers ($84.3 million over four years) will help women, who perform the bulk of unpaid caring duties. These measures will enable these women to participate more in paid work if they choose, strengthening their economic independence.

Plans to cut the marginal tax rate in the mid-income bracket, from 32.5 cents down to 30 cents in the dollar, could also make it financially worthwhile for some part-time working mothers to lift the number of days per week they work.

This budget offers a sizeable increase in federal spending on urban roads via a boost to the so-called Urban Congestion Fund from $1 billion to $4 billion.

Most of this will go on minor road widening projects that were announced a fortnight ago in the National Population Plan.

Within this bundle, $500 million will be spent on commuter car parks at suburban rail stations.  There is also $2 billion in funding for Geelong Fast Rail. 

The mix of projects seems ad-hoc. Minor suburban road projects will have only minor potential to reduce congestion, and only over the short term.

The spending of $500 million on car parks at rail stations is misguided, given the desperate need for improved suburban rail feeder bus services to get cars off the road and, in turn, reduce congestion and emissions.

The major Victorian public transport project in the budget is the $2 billion Geelong Fast Rail scheme.

Yet, this project has not yet been formally assessed by Infrastructure Australia and languishes in IA's lowest category of priority, implying that the funding is aimed at political considerations rather than technical need.

Finally, because Melbourne has no transport plan, the Federal Government cannot be confident that its spending is part of a well thought-out, long-term decision-making framework.

This budget is a mixed bag for the social economy.

The best social economy budgets focus on spending, not tax cuts, and, on the surface, this one looks ok. Despite the headlines, this budget allocates around $10.8 billion over five years for spending initiatives, while a net $400 million goes toward tax cuts.

But the devil is in the detail.  

Of the new spending this year, $1.2 billion involves bringing forward local government financial assistance grants. And $1 billion of the new spending measures the year after is for the treasury, with infrastructure the biggest beneficiary.

Over the full five years, it’s pretty much the same story.

Are there any stings in the tail? The social services portfolio as a whole gets an extra $550 million over the next couple of years, but then cops $1.6 billion of cuts in the three years after.

GST revenues are down $10 billion over the next five years. That money will come straight out of the pockets of the state and territory treasuries, which fund much of Australian social service provision.

Perhaps the biggest news involves a $2.6 billion cut in Commonwealth spending in 2022-23 on ‘decisions that have been taken, but, yet to be announced’.

Initiatives such as SAGE are critical for increasing female participation in STEM fields, which ensure we are tapping into the expertise of the full population, not just 50 per cent. I am delighted to hear that such initiatives are receiving $3.4 million new funding in the 2019 budget, and I hope the government will continue to actively support gender equity in the workplace and beyond.

I am pleased to see that the government are taking the underrepresentation of women in STEM seriously. As an early career researcher, I have been surprised and disheartened to see the barriers faced by women progressing in their careers. Initiatives like SAGE are instrumental to removing the systemic barriers faced by women and developing a more inclusive STEM workforce which benefits everyone.

The government’s 10 year commitment to the Medical Research Future Fund, with further medical research training positions, and support for clinical trials, will have a positive outcome for health in Australia, and will also ensure that Australia continues to contribute to improving health across the globe.

Prioritising medical research chosen through consultation with health consumers and local and international experts will help to ensure that Australians continue to receive the best possible healthcare.

With the positive economic outlook reported in the budget, now is the time to seize this opportunity and bolster investment in research and innovation across all disciplines. While it is pleasing that the funding for the National Health and Medical Research Council is maintained in the budget, I am disappointed to note a reduction in funding for Universities and for the Australian Research Council, as these organisations are essential to drive the basic research that enables the clinical research that translates into practical outcomes for patients.

A failure to keep pace with inflation for most national research agencies is a stark concern for the science and technology sector.

This has been coupled with cuts to the Research Support Program, which compound the cuts this program suffered in December - severely limiting our universities’ ability to conduct world-leading research.

Research at tertiary institutions is also severely hampered by the reallocation of $3.9 billion from the Education Investment Fund (EIF) to a new Emergency Response Fund. While it is important to support those affected by emergencies including floods and fires, taking funding away from education to fund emergency responses is a false economy. STEM education should be supported in a way that increases our National capacity to predict, prevent and respond to the impacts of national emergencies.

It is good to see that research funding agencies have been supported to meet the costs of inflation this year, something STA has called for over many years. 

Bold investments in medical research and development through the Medical Research Future Fund will empower Australian scientists and technologists to become world leaders in their field.

What we did not see in this budget was an ambition to be the clever country in all fields. A Fund to support the translation and commercialisation of knowledge built through non-medical science research programs would complement the MRFF and amplify the economic returns that STEM brings for Australia.

There is no need to raid Australia’s last remaining fund for building education and research infrastructure.

As an advanced nation we should be able to invest in both research infrastructure that helps us understand and address emergencies, as well as an emergency response fund.

Surely with a $7.1 billion surplus this is not an either/or proposition.

The EIF has been gathering dust since the Government froze payments, with the last payout in 2013.

It is now valued at $3.9 billion — meaning six years of lost investment opportunities.

The world-leading research supported by EIF infrastructure includes work on climate change, natural disasters and human behaviour — all vital to successful emergency responses.

Tragically, more Australians than ever are being affected by natural disasters. University research —supported by long-term infrastructure investment — can help us tackle the cause, not just deal with the aftermath.

Cutting edge research — the kind that changes the lives of everyday Australians through medical and social breakthroughs — needs cutting edge infrastructure to make it happen.

Without modern labs and equipment we cannot take part in modern research — they are the baseline tools our students and researchers need to fuel our economy and improve society.

The Budget clearly shows that the Government has the funds to both support Australians affected by natural disasters and to back essential research capability.

There is no reason to make Australians choose between these two important priorities.

My recent research report for the National Association for Women in Construction (NAWIC), focuses on high school girls' perceptions of the Construction Industry.  The findings revealed that school girls do not have a broad understanding of the breadth of careers in STEM, that few considered construction a STEM career, and most don’t have a clear understanding of the range of construction opportunities out there.
 
They are, however, acutely aware of the impact of male domination in the construction industry, and have valid concerns about how they will be treated. This is adversely impacting their willingness to consider the industry as a career.
 
In order to attract young women into male dominated industries, like the construction industry, attention is required at all stages in career development lifecycle. We need to provide better knowledge about the diverse career opportunities available and their benefits.  But we also need to improve the rates of progression and retention for women already in the industry – as they become the visible champions and spokespeople for younger women developing their career aspirations

$158 billion in tax cuts (plus an unknown cost from 2024 for cutting the 32.5% tax rate to 30%) on top of the $140 billion already legislated. The budget left little to the three million Australians that live in poverty. Tax cuts for the well off took precedence while the households in the lowest 40% by income get no benefit from tax cuts at all.

Importantly, there was no increase to Newstart. Newstart is just $40 a day. Lifting Newstart by $75 a week would cost $3 billion a year, one quarter of the cost of the tax cuts promised. The proposed Govt energy payment, the one off electricity payment, will not be available to this group of vulnerable Australians.

For the NFP sector there is proposed increases investment in the fields of mental health, aged care, carers, and Indigenous organisations (but a disappointingly small $5 million over 4 years allocated to respond to suicide among young Aboriginal and Torres Strait Islander people). Men’s and women’s sheds will be tax deductible. While worthy this is an ad hoc approach to the DGR framework. For the homeless, the Government's strategy appears to limit its exposure to the cost through subsidising experiments to leverage private sector investment through complex social impact bonds.

WELCOME MEASURES: For the not-for-profit sector there are proposed increases in investment in the fields of mental health, aged care, carers and Indigenous issues, for example...
$500m Royal Commission into Abuse of People with Disability,
$80m for young carers
$280m for 10,000 home aged care packages
$460m for mental health
$330m for domestic violence services

CONTROVERSIAL MEASURES IN WELFARE:

Two of the biggest savings in the budget have come from the welfare sector with data-matching technology expected to save $2.1bn over the next five years from social security payments - remember the anguish caused by robo-debt? here we go again?

For Indigenous organisations, a disappointingly small $5 million over 4 years is allocated to respond to suicide among young Aboriginal and Torres Strait Islander people. At least 35 indigenous people took their own lives in the first 12 weeks of this year. 

$129m has already been announced to extend the controversial cashless welfare card to all of Northern Territory, and to Cape York communities in Queensland.

Continuation of cuts to Australian aid, and aid funds are being diverted from Asia to fund the ‘Pacific step-up’ continue its downward trajectory to a record low of 0.19 per cent of Gross National Income in 2021/ 22 -short of the $200 million Oxfam has calculated is needed to tackle ongoing crises like Syria and Yemen.

For the homeless, the Government's strategy appears to limit its exposure to the cost through subsidising experiments to leverage private sector investment through complex social impact bonds. But, what is need is a major direct capital investment in social housing, complemented by a new rental housing incentive which would guarantee affordability for people on the lowest incomes and a national Aboriginal and Torres Strait Islander housing strategy.

STRANGE ANOMALY:

Men’s and women’s sheds will become tax deductible (received DGR status). While worthy, this is an ad hoc approach to the DGR framework. This might mean anyone can say there charity is a 'shed' and get the coveted tax deductible recipient status. This would be tricky to implement

OTHER CURIOSITIES:

The federal government has announced it will close the Christmas Island Detention Centre, just weeks after reopening it at a cost of more than $185m. Not a single refugee or asylum seeker has been transferred there.

After the Captain Cook statue in Morrison electorate last year this year, $800,000 over three years from July 1 will go towards Australia Day activities and a review of the National Australia Day Council’s programs.


BOTTOM LINE: TAX CUTS DO NOT HELP 3m AUSTRALIANS LIVING IN POVERTY:

The budget left little to the 3m Australians who live in poverty. Tax cuts for the well-off took precedence, while the households in the lowest 40 per cent by income get no benefit from tax cuts at all. $158bn in tax cuts (plus an unknown cost from 2024 for cutting the 32.5 per cent tax rate to 30 per cent) on top of the $140bn already legislated. People on $200,000 will get over $224-a-week. People on $50k will get $23-a-week. People on $25,000 (on pensions) will get a one-off payment of $75 (equivalent to $1.40-a-week) People on $15,000 (on Newstart) will get nothing. 

Importantly, there was no increase to Newstart. Newstart is just $40 a day. Lifting Newstart to $75 a week would cost $3 billion a year, one quarter of the cost of the tax cuts promised. The proposed Govt energy payment, the one off electricity payment, will not be available to this group of vulnerable Australians.

WHAT IS NEEDED:

Newstart should go to $75 per week.

A $320 million boost to funding for public dental services would double the number of adults treated over the next five years.

But what is needed is a major direct capital investment in social housing, complemented by a new rental housing incentive which would guarantee affordability for people on the lowest incomes and a national Aboriginal and Torres Strait Islander housing strategy.

Perhaps the Government needs to fully fund the NDIS to treat its own deafness to climate change? To not respond to the growing chorus from the Australian public, the rural sector, industry, the youth, and the health sector indicates either profound deafness or simply a case of wilful refusal listen to their needs.
 
This budget is full of lollies and tantalising teasers, but completely fails to deliver a healthy future.
 
Australia wants a future that is safe. They want their government to protect them, their families and their future from the greatest risk – as judged by the World Economic Forum’s Global Risk Report  - Climate Change!
 
Obsessing with relative low-level risk of terror threats whilst ignoring that existing and future populations are in real and present danger of suffering serious loss of health and livelihoods to the ravages of climate change is at best misguided. At worst, it smacks of intended negligence.
 
Steering Australia towards a low carbon economy, building community and industry adaptive resilience to future climate disruptions is the task of budgets. It is the task of good governance, of governments that govern for the people and for their collective future.

There remain clear structural and organisational cultural differences for men and women in the STEMM workforce. While there is a lot of gender equality work going on, we will struggle to reach equality by 2030 at the current pace. There remains an unequal distribution of power, persistent and significant wage differences and women have lower rate of visibility in the workforce – that diminished ‘presence’ goes against them. We have to get much better at being serious about flexible working arrangements so that the traditional reliance on being in the office 9-5 (or longer) is a distant memory.

We also need more females in STEMM management and leadership roles so it’s tangible. ‘You actually can be, what you can see’. We need to create more career paths and urgently close the earning gap. But until there’s a broad understanding of the ‘so what’ factor with gender equality, we won’t equalise the disparity. So, the what’s it in for organisations, society and the country to have gender equality in STEMM has to be appreciated and seriously backed. We’d see better innovation output and it’s estimated, a boost of around 12% to our annual GDP by 2025 in a best-in-region scenario.

I am happy that the Government recognises that STEM is crucial to our nation’s future and we should stop wasting half our national brainpower. 
 
It’s good that they are offering $3.4M in tonight's budget, including $1.8M to keep  SAGE going for another year, but it’s nowhere near enough. SAGE is a terrific program because it encourages institutions to make really practical changes that encourage women to take on STEM roles and stick with it.  I would have liked to see a much broader commitment to keep SAGE going into the future.
 
But mainly I worry that the recent withdrawal of fifty times this amount in research funding from universities is making it impossible for them to achieve SAGE targets anyway. A lot of things that would really help women cost money (top of my list is technical assistance to tide research over when a woman is on family leave). Universities have fewer and fewer resources to improve their support of women in STEM.
 
Further shrinking of University funding exacerbates problems in the workplace and makes it even more unfriendly for women. Academics are under more pressure to publish, have more responsibility to students (now “clients”), and more distractions toeing innumerable administrative lines. The job is getting more impossible for everyone – and, as usual, women suffer disproportionately.
 
$1.5m for a national digital awareness-raising initiative sounds like a good idea, but I’d like to know to whom it is targeted, how its success will be assessed and how it will fit in with the many other initiatives, like 'Choose Maths'.

The Telethon Kids Institute welcomes the Federal Government’s budget announcement of a $3.4 million initiative to tackle the under-representation of women in STEMM. Currently, the majority of science graduates are women, but despite large numbers starting their careers within the scientific workforce, women scientists account for under 20 per cent of senior academic positions.

The issue of gender inequity needs to be prioritised and improved in order to have the necessary diverse talent pool of human intellect and skill to apply to big scientific challenges, grow our capacity for innovation, our workforce and economy and to become global scientific leaders. This budget initiative gives the issue recognition as one of national importance. The Institute is committed to being champions of gender equity, diversity and inclusivity – and that’s why we are one of 32 medical research institutes and universities around Australia participating in the Science in Australia Gender Equity (SAGE) pilot. This is a commitment we are proud of and will work towards paving the way for greater opportunities for women in science.

Diverse teams perform better in the workplace, and that having a variety of views leads to better outcomes. Research has shown again and again that there is a direct link between diversity  and more innovative thinking.
 
That’s why it’s critical to have more women in science. Universities have an obligation to set the lead for society by example. With a female Chancellor, female Dean of Science, a female Dean of health, and female head of our school of life sciences, UTS is demonstrating a commitment from the top-down to lift the number of women in STEMM. We need it.
 
In my team at the CNRM, women outnumber men. Mentoring young scientists is something I’ve been committed to throughout my career, and I can say first-hand that gender diversity leads to better ideas, better results, and superior science.