Affording the basics

2020 Victorian Budget Analysis

Being unable to afford the basics puts people’s health and wellbeing at risk. Turning off the heating to save on electricity bills can make people sick or exacerbate existing conditions. Avoiding visiting the doctor or filling a prescription because out-of-pocket costs are too high can lead to worsening illness, and eventually health crisis.

Low-income households entered the pandemic with wafer-thin financial buffers. The COVID-19 pandemic, and its economic fallout, have stretched household budgets to breaking point. Almost two-thirds of Australians report being either ‘somewhat’ or ‘very’ concerned about their financial wellbeing. VCOSS welcomes the Government’s commitment to “using our Budget to help household budgets”.

The one-off financial assistance for eligible low-income households through the $250 Power Saving Bonus will help thousands of families to immediately pay their bills. Free kinder and vouchers to help low-income families afford sporting activities will reduce pressure on household budgets, and promote health, wellbeing and physical activity among Victoria’s children. VCOSS looks forward to working with the Government to make sure the Power Saving Bonus and housing upgrades have maximum impact for Victorians experiencing energy-related difficulties.

Over the long term, the game-changing investments in social housing and energy efficiency will provide Victorians with a secure, healthy home to live in. This will make a profound difference in the lives of those Victorians currently in insecure or inappropriate housing, and will drive state-wide recovery through economic stimulus and associated positive social and environmental outcomes.

But despite many positive initiatives in the Victorian Budget, without an increase to income support rates, too many Victorians will simply not be able to make ends meet. The doubling of the JobSeeker Payment by the Commonwealth Government has lifted many people out of poverty. We have heard countless stories of people who can now afford things like long-overdue dental treatment, fresh fruit and vegetables, or to replace a broken fridge. Without action by the Commonwealth Government, the JobSeeker payment will revert to the old, unlivable Newstart rate of $40 a day just before Christmas, thrusting many people immediately into poverty.


Positive initiatives 


Power Saving Bonus 

$83.2m in 2020-21 (total $131.6m/2yrs) to provide for a one-off $250 Power Saving Bonus for Victorian households that have at least one JobSeeker, youth allowance recipient or pensioner and use the Victorian Energy Compare (VEC) website to search for the cheapest electricity deal. Further support is provided to frontline community workers to assist with targeted support to vulnerable households. 


Home energy efficiency upgrades 

$163.7m in 2020-21 ($447.7m/4yrs) for energy efficiency upgrades in 250,000 lowincome households and over 35,000 social housing properties, delivering lower energy bills, improved thermal comfort for families and climate-resilient housing. 


More Solar Homes 

$68.3m in 2020-21 ($149.4/4yrs) to expand the Solar Homes program, including an extra 42,000 solar panel rebates over the next two years (including for renters via interest-free loans) and 17,500 household battery rebates over the next three years. 


Supporting families 

$15.8m in 2020-21 ($31.6mil/2yrs) in additional funding for the Camps, Sports and Excursions Fund to support families in need of financial support in 2021 to participate in school activities such as camps, sports, outdoor education programs, excursions and incursions. Additional funding will also be provided in 2021 to State Schools’ Relief for the Affordable School Uniforms program, to deliver more free school uniform items and other essential items to government school students experiencing financial hardship. 


Get Active Kids 

$10.5m in 2020-21 ($21m/2yrs) for the Get Active Kids Voucher Program to assist families with the costs of participating in community sport. The funding supports up to 100,000 vouchers valued at $200 each to use toward memberships, participation fees, uniforms and equipment for sport and recreation activities for eligible Victorian children. The program will encourage Victorian children to be active by reducing financial barriers to participation in sport and recreation. 


Maintaining the capacity of the children and families system  

Package includes funding for Good Money stores in Collingwood, Geelong, Dandenong and Morwell to support vulnerable Victorians experiencing financial hardship by building their financial capacity and security. 


Public Transport Ticketing Strategy 

$2.8m in 2020-21 ($4m/2yrs) for a new strategy that will assess public transport ticketing options and outline a pathway to ensure value for money and customer experience outcomes are maximised. 


Rural Financial Counselling Service  

$2.1m in 2020-21 for the Rural Financial Counselling Service to continue to provide free financial counselling to farming and related small businesses suffering financial hardship. This funding is a co-contribution with the Commonwealth to this program. 


Further policy directions 

Access to healthy, affordable food is crucial to good health and wellbeing. Demand for food relief has increased dramatically during the pandemic, along with a major surge in demand for emergency relief and financial counselling support. While we welcome funding for the Rural Financial Counselling Service, additional investment is needed in state-wide planning, coordination and growth across these vital services.

Everyone should be able to get to work and education and participate in community life – but the sad reality is access to public transport in Victoria is haphazard. The Public Transport Ticketing Strategy should make sure public transport fares and concessions are proportionate and fair for people on low incomes. The WestJustice School Myki Pilot Project found that, for some kids, the cost of getting to and from school can become a major barrier to attendance. Cost of transport is one of the hidden costs of education that the Government can address by providing free transport passes to students who need it.

In the coming year, with unemployment and underemployment high, VCOSS would expect an increase in the number of people seeking concessions. While the Budget forecasts modest projected growth, demand may be much higher. We also wait further progress on recommendation 6C from Thwaites retail market review regarding an extensive investigation into the energy support scheme for concession card holders.

Finally, the Budget includes a number of funding initiatives on digital infrastructure and skills, across different areas such as eradicating mobile phone blackspots in bushfire-affected areas, business-grade broadband to boost local economies, and public service improvements.

These are positive commitments – but the digital divide is not just a question of disaster preparedness or economic growth, and access to the internet is not a luxury, it’s an essential service that can be the difference between getting a job or living in poverty. Affordable technology and devices unlock access to work, education, social support and essential services.

A high level of digital inequality persists in Australia. Victorian community service organisations have shown real creativity in ensuring that this didn’t lead to social isolation for those on the wrong side of the digital divide during lockdown. Future budgets could expand on these commitments and help people fulfil their potential by making sure everyone has access to the devices, affordable or free public wi-fi, and training they need to access online services and supports.