Thursday 19 April 2012

Interesting article on middle class welfare

At The Conversation Gerry Redmond and Peter Whiteford have written an interesting article For richer or poorer: the delicate art of messing with middle class welfare. It notes how well targeted Australia's family assistance programs are, especially compared to other countries. They note that:
The main reason why family payments go to middle income and some higher income families is that we have generous base rates of payment for lower income families and we try to not withdraw them at too high a rate in order to avoid disincentives to work. Correspondingly, if governments wanted to substantially cut “middle class welfare” they would need to either cut benefits for lower income families or increase effective tax rates on middle income families through a tighter income test (or both).
Matt Cowgill has posted an interesting graph on Twitter that shows how "'middle class welfare' in Australia has changed - not as much as you'd think".


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