One thing ‘missing’ in this year’s Federal Budget

This year’s federal budget contains billions of dollars for cost of living, defence and infrastructure, but critics say there is one thing missing.

This year’s budget was missing one key change that could have set everyday Aussies on a better track for the year ahead, critics say.

Wages growth is tipped to increase from 2.75 per cent in 2021-22 to 3.25 per cent in 2022-23.

It is an increase of just half a per cent despite major increases in the cost of living in recent months.

The Opposition overnight criticised the government over failing to address the issue of Australian wages, calling it a “big challenge and big risk in the economy”.

In a post on Twitter, Opposition leader Anthony Albanese said “what this Budget represents is again after almost a decade in office, they want a second decade, but with falling wages and with a trillion dollars of debt, with nothing to show for it”.

Speaking to Leigh Sales on the ABC’s 7.30 program, Shadow Treasurer Jim Chalmers said the government is “pretending to care” despite overlooking the issue until now.

“The big risk of another three years of this government is that real wages are falling again,” he said.

“I don’t think the self congratulation from the Treasurer is warranted when Australian working families dealing with the skyrocketing cost of living and falling real wages are falling further and further behind.”

The defining features of #Budget22 are falling real wages, a trillion dollars in debt with nothing to show for it, and no plan for the future beyond the election. My interview with @leighsales on @abcnews#auspolpic.twitter.com/O3vBtnbe8f

— Jim Chalmers MP (@JEChalmers) March 29, 2022

The Australian Council of Trade Unions described one-off payments and tax breaks announced in the budget as “election bribes”.

“The cost of living crisis has been biting for longer than just this year,” ACTU president Michele O’Neil said.

“This Government has presided over almost a decade of stagnant wages growth.”

Australians are forecast to again see minimal wage growth in this year’s budget. Picture: NCA NewsWire / David Crosling

Ms O’Neil said there was nothing in the budget that would deliver wage increases for Australian workers.

“The test for this government was whether they would end nearly a decade of low wage growth. And the answer tonight is ‘no’,” she said.

With a forecast 0.5 per cent increase, the budget described wage growth as “strengthening”.

However, it added: “There was significant uncertainty around the pace at which wages growth will accelerate, given the unemployment rate is at a historically low level.”

ACTU President Michele O'Neil said the government had failed to support a wage increase, leaving Australians far worse off in real terms. (AAP Image/Mick Tsikas)

“What the government should have done and failed to do is support an increase on the minimum wage. They also could‘ve supported that important move to lift the wages of aged care workers that we know are so underpaid and undervalued for the work they do,” Ms O’Neil said.

“Tonight, the budget‘s own figures confirm that workers will lose another $500 in the first six months of this year [in real wage cuts].

“They should have led the way by giving an increase to workers in the public sector – they could lift wages and remove the pay gap but instead, we‘ve seen one-off payments.”

What we needed in this Budget was real increases to wages, and what Morrison has delivered is one-off election bribes instead.

— Australian Unions (@unionsaustralia) March 29, 2022

Finance Minister Simon Birmingham told Sky News’ Paul Murray that the federal government has forecast wages to grow over the coming years as inflation lowers.

“That will be complemented by our income tax cuts, the next stage of those coming in,” Mt Birmingham said.

“If our Government is re-elected, Australians will see the 37 per cent in the dollar income tax bracket eliminated.

“They’ll see the 32 cent in the dollar come down to 30 per cent and around 90 per cent of all taxpayers will pay no more than $0.30 in the dollar at the top marginal rate.

“So all of that is about providing more disposable income on top of the real wages growth to help Australians.”

Yet Shadow Minister for Health and Ageing Mark Butler argued: “There is nothing in this Budget to put more nurses into nursing homes or give carers more time to care. Nothing to lift aged care wages and nothing to improve transparency and accountability.

“Older Australians and their carers deserve so much better.”

Chief executive of the Business Council of Australia Jennifer Westacott told the ABC’s David Speers “Australians want and expect people not to just dig in on turf wars, they expect them to be in acting in their interest”.

Calling wage growth the government’s “big job to focus on, she said: “I think people have got to go back to saying, how do we get wage growth sustained across the whole of economy. “The problem with what we’re seeing now is wage inflation, which is patchy, which actually is counterproductive.

“We’ve got to address the whole issue of skilled labour, getting people skills, but making sure that we’ve got a sustained effort on wages.”

Originally published as One thing ‘missing’ in this year’s Federal Budget