Analysis shows poor cop worst of budget, again

NEW analysis of the effects of the Abbott government's second budget on families has confirmed low-income earners with older children will be hit hardest.

The modelling by the Australian National University's Crawford School of Public Policy showed families on welfare with school-aged children stood to lose most.

It showed two-parent families on one income up to $60,000 a year, with two children aged eight and 11, would lose $84 a week.

Single-parent families on the same income with the same children would lose $53 a week, but families on more than $100,000 in either category would not be hit.

ANU's Professor Peter Whiteford told APN the effects would mainly be felt due to a cut-off for Family Tax Benefit Part B when children turned six years old.

He said while the government's second budget was not as severe on families as its first, the changes would still be felt more strongly by lower income earners than those on higher incomes.

Prof Whiteford said the modelling did not take into account potential changes to childcare or "behavioural change", as the government hoped the adjustments would push more parents back into work.

He said, however, parents in regional areas would likely feel a "disproportionate impact" from the changes as behavioural change also implied there were "jobs out there to get".

"I think it's fairer than the last one - the nastiest element then was the six-month wait for young people to get Newstart, and that's been reduced to one month," Prof Whiteford said. "Overall, it's less slanted to hit low-income people, but on the Family Tax Benefit side of things they're proposing to be about as negative."

While Prof Whiteford said there was "much to be said" for encouraging people into work, the current budget debate need to address crucial revenue issues, not just cut spending.

"Nobody wants to pay more taxes, but the evidence shows we need to think about it ... and we've got this predictable problem of an aging population," he said.


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