Gap between Australia’s rich and poor widening, new report by Australian Council for Social Service finds

THE gap between the rich and the poor in Australia is getting worse. Where are the country’s highest and lowest incomes?

wage inequality

WELFARE groups are demanding authorities strengthen Australia’s social safety net as a new report shows the gap between the nation’s rich and poor is widening.

A report released today by the Australian Council of Social Service (ACOSS), Anglicare, the Salvation Army and St Vincent de Paul found Australia’s level of income inequality is above the Organisation for Economic Co-operation and Development average. Our top 10 per cent of wealth holders own 45 per cent of all wealth.

But we are doing better than the United States and the United Kingdom, thanks to Australia’s minimum wage and tax systems.

“While we are nowhere near yet where for example the United States is in terms of the divide in the community, we are clearly heading in the wrong direction,” ACOSS chief executive Cassandra Goldie told ABC radio.

“We’ve had a big trend here in terms of disproportionate growth of income by people at the top end compared to those at the bottom.”

The report found Australians in the top 20 per cent of income earners had a staggering 70 times as much wealth as those in the bottom 20 per cent.

Tasmanians are more likely to be in the bottom 20 per cent of income earners, while those in Western Australia are likely to be in the top 20 per cent, due largely to the mining boom.

NSW, Victoria and Queensland had an even representation of people across the income spectrum, but South Australians were likely to be on the bottom or in the middle.

Perth, Sydney and Brisbane had more residents in the top 20 per cent of income earners and less at the other end compared with other cities.

But there is a rural and urban rich-poor divide, with metropolitan residents better off compared to those in the country.

Dr Goldie said concentration of income and wealth in the top is bad for the economy, as much as for society.

“Wages growth for people on the bottom has largely been through greater participation in work, working longer hours, but at the top it’s been a straight-up increase in pay — those generous bonuses, very well known in the IT and financing sectors. And so we’ve had some significant heavy lifting being done by low paid workers,” she said.

“The first priority is to make sure that people are paying their fair share of tax.”