Short-changing the poor - Ross Gittins - Opinion - theage.com.au

Listen to what one of Australia's top economists (and the only comprehensible one) says about the generosity of the Howard Government.

Short-changing the poor - Ross Gittins - Opinion - theage.com.au: "But the thing I find most distasteful about this budget is that, while giving such juicy carrots to the well-off, it also takes the stick to the poorest and most disadvantaged in our community: sole parents and the disabled.

The problem is not that they're being helped to find jobs or even that an element of compulsion is being used to rouse some from the slough of despond. No, it's that the already meagre benefits of about $240 a week are to be cut. This is because new applicants for the disability pension judged capable of working part-time and sole parents with only school-age children will be put on the dole rather than the pension. As a result, those with disabilities will get $40 a week less and sole parents $22 a week less.

And get this: whereas the rate at which pensions are withdrawn when people earn extra income is 40 cents in the dollar, the rate at which the dole is withdrawn is now 60 cents in the dollar.

So in the same budget that did so much to cut marginal tax rates for the better-off, the effective marginal tax rate faced by the affected sole parents and disabled has been increased by 20 cents in the dollar.

See? To get the rich to work harder you have to give them more money; to get the poor to work you have to give them less."