The Impact of the Crisis on Australian Social Security Policy in Historical Perspective

Abstract

AbstractThe Labor government was elected in November 2007 with a commitment to reject the labour market deregulation and other neo‐liberal policies of its predecessor, promote equality of opportunity and tackle entrenched social and economic disadvantage by implementing a new social inclusion agenda. In response to the financial crisis which had begun at the end of 2007 and had turned into a full global recession by the middle of 2008, the government introduced two substantial stimulus packages funded from the large budget surplus it had inherited from its predecessor. The fiscal stimulus has helped Australia to become the only advanced economy to avoid a technical recession (to date), although there is concern that the downturn has created a situation where social policy is being driven by political expediency rather than by the principles and commitments set out in the government's pre‐election social policy manifesto. Against this background, this article examines how the latest crisis has shaped social security policy in Australia and compares the recent policy response with the policy response to earlier crises. Analysis focuses not just on what was actually done, but also on the constraining role of prevailing economic and political circumstances and on the processes that were used to drive reform in a wage earners' welfare state.