June 13th 1998

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Articles from this issue:

Free markets: the ups, the downs

The threat to sovereignty

Living in a globalised world

The new economic freedom

Globalisation: the downside

ASIA: What Happened?

Taking control of our destiny

Policy 2: Using the Reserve Bank to boost capital investment

Policy 3: Boosting national savings

Policy 4: Justice for families

New Struggle, New Agenda, New Strategy

EDITORIAL: An idea whose time has come


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Policy 4: Justice for families

by Patrick Byrne and Brendan Rodway

News Weekly, June 13, 1998
“The largest single immediate cause of marriage breakdown is economic pressure which brings about distortions in family living patterns.”
— B. A. Santamaria

Australian families are suffering from a steady decline of incomes, rising unemployment and replacement of full-time with part-time jobs. This has forced large numbers of women with dependent children into the paid workforce.

Surveys over the past 15 years have shown that at least two-thirds of women with young children would prefer to be full-time mothers, but economic circumstances dictate otherwise.

While the policies described above are fundamental to remedying the employment and family income crisis in the medium-term, immediate assistance is needed to hundreds of thousands of families.

The Homemakers Allowance is a proposal to pay $145.05 per week ($7,542.60 annually and equal to the current maximum Parenting Allowance) to any family with dependents where one parent chooses to be a full-time homemaker.

It is designed to give families a real choice. It also aims to ease the financial pressure on many families and strengthen the family unit.

The net cost of $6.2 billion would initially be met by using a proportion of the revenue raised by a primage duty.

The allowance would not be means tested but would be added to the taxable income of the recipient. It involves abolishing the Parenting Allowance and allowing for further possible savings from, mainly, reduced unemployment benefits and reduced child care costs.

It would also have an impact on the employment market. As Professor Paul Ormerod points out in The Death of Economics, one solution to the unemployment problem lies in workers taking several years off “at certain points in the life-cycle, such as when one’s children are young”.

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