Not a Level Playing Field
This paper brings together a raft of data to analyse income and wealth inequality, building on our earlier intergenerational equity research.
In brief:
- The deep economic divide between Australia’s rich and poor is in danger of worsening unless wide-ranging government policy reform is undertaken, a new Green Paper released by the Actuaries Institute warns.
- The Actuaries Institute paper, Not A Level Playing Field, for the first time brings together a raft of Australian survey data with new analysis to paint a snapshot of income inequality in Australia. Importantly, it builds on the established work of the Australian Actuaries Intergenerational Equity Index and the investment valuation work actuaries pioneered for Federal and State governments.
- The paper highlights that inequality is significantly higher than in the 1980s, with the wealthiest 20% of households currently having six times the disposable income of the lowest 20%. Wealth inequality is even larger with the wealthiest quintile having 230 times more net assets.
- These big gaps in income and wealth have translated into poorer social outcomes for low-income households.
Given the difficult economic conditions we are faced with Australia should brace itself for the gap to increase even further. A more holistic review of inequality will not only result in better outcomes for society but can also reduce long term budget pressure by ensuring taxpayer money is spent in the most appropriately targeted places.
— Elayne Grace, Chief Executive Officer, Actuaries Institute
The fear is that the income gap could widen even further because of the increasing casualisation of the workforce and more people being employed by the ‘gig’ economy. We believe inequality needs to be a prominent consideration in setting policy direction.
— Dr Hugh Miller, Principal, Taylor Fry
A snapshot of how existing economic inequalities translate into large differences in wealth and wellbeing in a broad range of areas.
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