Opinion & Commentary
Ramshackle propaganda exercise ignores reality
Francis Sullivan (chief executive of Catholic Health Australia) says Australia is facing a huge and growing problem of poverty, but he doesn't want anybody to investigate this claim (AFR, June 30).
The harsh reality he says, is that "up to 4 million Australians" are suffering daily hardship. But if anyone dares to ask how this figure is derived, they are dismissed as sidetracking from the essence of the problem.
Sullivan also claims that poverty is getting worse: "A growing number of Australians are falling through the cracks and the social fabric is fraying."
But don't ask too closely what he means, or where he gets his evidence from, or you'll be accused of "academic carping and intellectual posturing".
Like many welfare activists, Sullivan wants us to believe that poverty is a major problem requiring radical political solutions. But he relies for his evidence on a recent Senate inquiry that has been thoroughly discredited.
This inquiry was dominated by opposition senators, and almost all the submissions it received came from welfare lobby groups, community activists, socialist intellectuals and trade unions wedded to an agenda of radical social change.
The report contained some dramatic findings and a list of costly policy proposals.
These findings and recommendations are now being recycled by welfare advocates like Sullivan and provide the basis for the new Vote No More Poverty campaign launched last week by a group of Christian charities demanding radical changes in government policies. But this whole propaganda exercise is built on sand.
At risk of being accused of carping, posturing and sidetracking, let us examine some of the most important claims.
The Senate report claimed that the rise in prosperity since the 1990s has been "captured by a few at the expense of the many," and Sullivan speaks of low-income families being left behind.
In fact, Australian Bureau of Statistics figures show that low-income households (defined as the second- and third-income deciles) increased their real standard of living by 8 per cent between 1994 and 2000.
The Senate report also claimed that a large majority of families under the poverty line experience long-term financial hardship. Not true. Sixty per cent of people under the poverty line in 2001 had moved above it by 2002.
The Senate report suggested that over 1 million working households are in poverty, and Sullivan claims in his article that the ranks of the working poor have been swelling.
But even if we use the widely discredited Henderson poverty line (which welfare groups still like to use), this claim fails to stand up.
The federal award minimum wage of $467 per week is $60 above the Henderson poverty line for two adults, and low-earner families with children receive family tax benefit top-ups which keep them well above this line too.
No matter how defined, "poverty" is overwhelmingly concentrated in households where nobody is in full-time employment.
Sullivan's vague statement that up to 4 million Australians are living in hardship also seems to have come from the Senate inquiry.
This claim too is false, for it rests on data collected by the ABS which has repeatedly warned that the bottom 10per cent of reported incomes in its surveys are so inaccurate and unreliable that these figures should not be used by researchers.
Despite this, poverty activists keep using them. In a half-page newspaper advertisement launching the Vote No More Poverty campaign, it was claimed that 3.6million Australians live in households with an income below $400 per week. This estimate is based on ABS survey data. It is wrong.
The welfare activists and their allies in the unions, the universities and the Senate know their estimates are faulty, their data is unreliable and their measures are questionable. This is why they want to shut up anybody who questions them. Yet they continue to use these statistics.
Why are they so keen to exaggerate the scale of the poverty problem?
The answer is because a big problem helps to justify their call for big radical solutions.
A recent Department of Family and Community Services report found that genuine hardship affects about 3 per cent of the population, and that in many cases this reflects the way people spend their money as much as the amount they have coming in.
Seen in this light, the sort of policies needed to tackle the problem are small-scale and targeted, aiming to help problem families cope better with their money while cajoling long-term workless adults back into the labour force.
But this is not what welfare activists want. They call for much higher welfare benefits, higher taxes, more government regulation of the economy and a national anti-poverty strategy which would give them a permanent and powerful place in the heart of government.
To get that, they have to convince the voters that poverty has become a massive and threatening problem, and that means inflating the figures.
No wonder Francis Sullivan doesn't want his campaign side-tracked by "academic fine points". Cold facts and analysis always were a danger to those who seek to influence policy with emotional rhetoric, propaganda and political humbug.
Professor Peter Saunders is social research director at the Centre for Independent Studies
