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A nurse holds the hand of an elderly patient.
Poverty was highest among older people, particularly single older people, the report found. Photograph: Dan Himbrechts/AAP
Poverty was highest among older people, particularly single older people, the report found. Photograph: Dan Himbrechts/AAP

One million Australians 'entrenched in disadvantage', report finds

This article is more than 8 years old

Despite two decades of economic expansion, 6% of Australians were classed as living in poverty, the Committee for Economic Development of Australia said

More than a million Australians are “entrenched in disadvantage”, with many of them having little hope of getting out of poverty, research released before the federal government’s budget has found.

Despite two decades of economic expansion in the country, up to 6% of the population – or 1.5 million people – were classed as living in entrenched poverty, the Committee for Economic Development of Australia report said.

Before the launch of the report on Tuesday, the Ceda chief executive, Prof Stephen Martin, said it was time to “tear up the rulebook” on the way the government approached poverty.

Any policy aimed at curbing disadvantage had to also tackle issues such as education and social exclusion, he said, identifying them as key areas for government intervention.

“Labour market programs – essentially using a big stick to tell people they’ve got to get a job or face even further financial disadvantage – should not be the primary policy instrument for this group of people,” Martin wrote in a piece accompanying the report.

“It is absolutely clear that labour market policies have not worked because they fail to tackle the heart of the problem and yet it seems they are the only approach successive governments are willing to focus on.

“The main problem often isn’t that people don’t have a job, but the consequence of a range of other issues including education levels, mental health, social exclusion or discrimination.

“It may well be that welfare spending may have to increase but the payoff longer term is potentially significant.”

Martin said it was a waste of taxpayers’ money and short-sighted to continue to spend welfare money without having effective policies in place to help people move out of poverty.

Government-funded early intervention programs were not being implemented on a wide enough scale to have a significant effect, the report found.

It said there were three key areas where reform must occur: education gaps, Indigenous disadvantage and mental health.

Improving provision of community-based care, early intervention programs to minimise hospital admissions and readmissions for those with mental illness, and creating customisable policies in collaboration with Indigenous communities were key to this reform, the report said.

Poverty was highest among older people, particularly single older people, followed by single people of working age (15–64) and sole-parent families, the report said.

An estimated 363,000 children aged under 15 were living below the poverty line.

“Australian poverty exceeds that in many other … Organisation for Economic Cooperation and Development countries,” the report said.

“In 2010, for example, OECD estimates indicate that the child poverty rate in Australia was higher than that in 25 (out of 40) high-income countries at around 15% – two percentage points above the OECD average.

“This might seem like a small difference, but it implies that around 85,000 children would be moved out of poverty if Australia raised its game to match the OECD average.”

The Coalition government has been talking tough on welfare spending. Upon taking up the social services portfolio during a cabinet reshuffle in December, Scott Morrison said getting Australians off welfare and into work would be one of his “core goals”.

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