The case for gender-responsive budgeting is clear.
The Australia Institute has released modelling indicating that 70% of the proposed tax cuts will flow to men, while only 30% will flow to women. If Stage 2 of the tax cuts are brought forward, for every $1 of tax cut that women get, men will get $2.28. If Stages 2 and 3 of the tax cuts are brought forward, for every $1 of the tax cut that women get, men will get $2.19.
Total employment in March and April fell 3.9% for men and 5.3% for women. Hours worked by men fell 7.5% while women’s hours fell 11.5%. Recession job losses affected women more than men, and bringing forward these income tax cuts will further widen the effective gender pay gap.
Matt Grudnoff, Senior Economist at The Australia Institute, reports that, despite women facing a bigger impact from the COVID-19 recession, Government stimulus has focussed heavily on male dominated industries such as construction. TAI research shows that income tax cuts mainly benefit high income earners which, in Australia, are overwhelmingly male. Giving tax cuts to the wealthy will have a very limited stimulatory effect on the broader economy, but it will significantly widen the economic gender divide. He proposes the Government could better target stimulus funds by investing in employment intensive industries like healthcare, aged care and education. This will be more efficient than bringing forward the tax cuts, creating more jobs for every million dollars of stimulus. These industries also employ large numbers of Australian women who have been disproportionately affected by the COVID-19 recession.