The government has announced a new targeted form of worker support to help tide casual workers over during mini-lockdowns of the sort that Victoria is currently suffering through.
But how many workers will actually be eligible for the scheme? To receive a check from a worker in lockdown needs to meet two main conditions:
Usually employed, but unable to work due to lockdowns (ie casual workers in non-essential industries).
Have less than $10,000 in their bank account.
Data journalists estimate that around 237,000 casual workers in Victoria have lost work due to the lockdown.
But what about the second condition? How many people have more (or less) than $10,000 sitting in their bank account? To answer that question we have to turn to the Household, Income and Labour Dynamics in Australia Survey (aka HILDA).
HILDA tells us that distribution of wealth among Australian workers is highly unequal. While some have barely anything in their bank accounts, indeed most workers fall beneath the $10,000 cut off (the red line), a decent proportion have more - so much, much more!
That trend persists even if we break down workers into casual and permanent workers. Unsurprisingly casual workers tend to have less socked away in their bank account, however a substantial proportion have more then the $10,000 cutoff.
In fact more than one third of casuals will be ineligible for support payments! This is in fact probably a conservative estimate as plenty of households would have boost their bank accounts by access their super under the government’s early access scheme last year.
You might think by conditioning the payments on liquid wealth you are effectively targeting poorer households, but this is also not the case. Over one fifth of even the poorest households measured in terms of income, nonetheless have managed to save $10,000 in their bank accounts. Punished by the government for saving too hard I guess. Conversely more than a third of casuals who live in the most high income households will still qualify for the scheme.
In short the $10,000 cutoff seems both petty and poorly targeted.
NB I used the 2014 wealth module data and indexed for inflation, as I didn’t have time to get the most recent set from 2018 but I suspect the results won’t differ too much.
Acts 16:31, 1 Corinthians 15:1-8, 1 Peter 1:17-21, Revelation 22:18-19