‘average’ incomes
Andrew Leigh has posted some useful figures on his blog that are worth pointing to next time someone suggests that politicians should be paid more. He has provided a rough percentage breakdown of the annual income of individuals and households. In short, it shows that only 2 or 3 per cent of the population earn over the $120 000+ a year which politicians get.
The figures also show that an individual earning $80 000 a year is a high income earner, but a household with an overall income of $80 000 is about mid-range. Which is also a stark reminder of just how big a struggle it can be for the many households who have a level of income well below that.
St James Ethics Centre also has a thread on the topic.
Andrew Leigh’s figures are as follows:
Individuals
1% $0
5% $0
10% $0
25% $1,620
50% $19,440
75% $48,600
90% $75,686
95% $97,416
99% $175,532
Mean: $32,337
Households
1% $10,389
5% $18,036
10% $25,920
25% $46,252
50% $80,826
75% $122,040
90% $172,152
95% $217,555
99% $388,368
Mean: $95,542
I should note that am not intending to engage in some easy politician bashing – perhaps not surprisingly I think most of them work harder and make more sacrifices than they are usually given credit for. But the argument that we should provide higher pay to get better quality politicians is rubbish. There are things we could do to improve the performance of our politicians (most of it based around improving the way politics itself operates), but paying more money isn’t one of them.
52 Comments, Comment or Ping
Naomi Cartledge
I often find it interesting,at other times it infuriates me,that people who think politicians should be paid more are frequently the same people who don’t think pensioners deserve more,or that the minimum wage should not be increased.It’s as though they assume,that those of us who only receive $540 per fortnight don’t go to the same supermarkets or fruit & veg shops,that somehow we don’t need the same things that they do.There’s this secret & not publicized ‘place’ for us to get discounted essentials. In 2006-7 Howard’s increases amounted to about $30,000-some people are raising a couple of kids on that amount per year.Costello,whose increases were double my annual income thought that a $10 increase for minimun wage earners was “about right”?
I watched the last half of Insight the other night on the topic of ‘can you live on your wage(taped it all)and agreed with a woman’s comment near the end-”Why is it,that only (lower)wage & salary earners increases are responsible or a threat to inflation”? Hear!Hear! We don’t hear that those on $100,000+ are a danger to the economy, or that the obscene amounts to CEO’s or Macquarie Bank ‘bosses’(thousands per minute) are to blame!
4th May 2007 in the Sydney Morning Herald,a graph of Wages & Profits as a share of GDP from Dec 2000-Dec 2006.(have it in front of me,ken)Profits went up by almost 3%,while wages went down by almost the same amount!The protestations by Howard govt of increased wages during last few years didn’t say,that the huge increase in CEO’s increases(some as high as 300%)were inflating the real figures.
While politicians get their increases without even have to justify them,workers,particulatly the lowest paid have to prove higher productivity outcomes,and other facets of workplaces to justify a pittance of an increase.Even with the subsidies by state & fed govts,the lives of many pensioners are only a subsistence.This ‘booming’ economy is not shared by all!I wish I could look forward with optimism, but??
May 9th, 2008
ken
So your saying 16% of society are homeless and have no income at all?
May 9th, 2008
Arjay
Just do a simple division.We have a $trillion GDP.Divide this by the number of workers ie 10 million.Each worker on average produces $100,000.00 pa.If the workers in reality only earn an average of $40,000.00 pa,where does the other $60,000.00 go,and why do we have a balance of trade deficit approaching $600 billion?
May 9th, 2008
philip travers
Wistfully,I look at Green Products,what Universities are telling me ,and what our scientist’s maybe saying.I think the Australian economy is out of Australian hands,and is co-run by economic theorists,overseas interests and any bureaucrat or Labor Glitterati that focuses the ALP’s attention.So the rotters keep gathering the comparative statistics and shove them down our throat,so we prefer jealousy rather than cooperation.I read the other day where French’s Forest,a well to do Suburb in Sydney has opened a Men’s Shed.Now if people are wanting to escape from the prison of not being connected to people of less income streams than them,here is another chance. Albeit a small effort to stop the rot in community. Now I think Senator Bartlett maybe right about the politicians,but, lets not be over-dramatic about the well paid.Because essentially before the election there was this elitist stuff dressed up in the pay of $ millions.So it is like we are being told to focus on a narrower range of our jealousies,which are probably decent ones,but should not be fixated.So did all the multi-millionaires fly away Peter fly away Paul and now Swan!? Or are some of them now stars of Rudd Inc!?.Help the libraries and book buyers! Now!
May 9th, 2008
Marilyn
Because we have been living beyond our means for a decade or so and we refuse to reign ourselves in.
There is this entitlement mentality that has grown up in Australia where we believe we are entitled to everything yesterday.
Yet 1 billion of our fellow human beings get by on less than $1 per day and during the years the AWB were stealing from the Iraqis they were starving to death on 47 cents per day.
Australian’s have become greedy, overweight, whinging, carping and pathetic tossers whose pioneer ancestors would be ashamed of.
May 9th, 2008
Lorikeet
Ken:
I think Andrew Leigh’s figures must also have included babies and children – maybe even residents of graveyards.
There’s no way they could be right – grossly underinflated, like a soccer ball with a defective valve.
Also, with the number of loopholes in taxation law through which high income earners can escape, inaccuracies must abound.
May 9th, 2008
Pete from Perth
Average income is such a meaningless stat. Median income figures would be much more useful.
May 10th, 2008
philip travers
Personally,my family,when as new residents in this country had or have little to do with pioneers,and maybe less with Aboriginal Australia.I take Marilyn’s point about comparative earnings with other countries seriously,but not her statements about what Australians have become.I think being overweight today,is becoming almost a backhander to at least two types of people,and because I have been affronted by this description,at times by alcoholic influenced cigarette smokers,one day,and built like a refrigerator other days…its a insult.My stomach isnt soft nor abs.,but a weapon that moved large quantities of apples on it,in a very fast time.I have seen the result of dropping weight in others,who have the same stomach type hernias.luckily for me the associated muscle is still functionally near athletic.Due to a careful diet,free of alcohol and cigarettes.I admit to being a tosser,of unusable at times potatoes.So I guees Marilyn still does a marathon or two,weight training,spends all her free money on affordable books,and not for one moment recognises,that maybe a few people older than herself,maybe, have created these conditions she decides are Australians today.Without reference to age,sex, income,injury,education,postcode,savings,job prospects,and all the other etceteras many people have to internalise.Sorry Marilyn,I sometimes think,Australians do not need to attack others like you have,as anecdote and history.Howard returns,to public speech making in Australia,the liberals out of power,and he says ,dont let them give you any cheek.Maybe thousands of Australians,on hearing that,wished they could get him alone,without Police protection.
May 10th, 2008
Lorikeet
Here are a couple more points to ponder.
On a television documentary recently, the reporter said that in a particular European country, a lot of the people had reported a “nil income”.
This puts me in mind of all of the country markets, craft markets, flea markets etc which have sprung up all over the place. If you buy anything from the traders, they never give you a receipt. This sounds like a “nil income” form of tax evasion to me.
Some are just ordinary families trying to sell unwanted household goods and secondhand clothing – but quite a few are selling fresh produce, plants, tee shirts, hardware (possibly stolen!) and various other retail products.
In some states of the USA, you can get a legitimate tax break if you donate SALEABLE secondhand clothing to charity. You bring your clothes into a Goodwill store for checking and then they give you a voucher.
I guess it’s also a good way to avoid people putting rubbish into charity bins, or leaving useful items next to the bin to be rained on.
I know I’m getting off the track a bit, but I’m sure some people will be happy to know that the people knitting for World Vision made 6 containers of little jumpers for children in overseas countries.
That’s not 6 cardboard boxes – but 6 of those huge containers which are loaded onto ships using cranes! Not a bad effort.
Patterns and donated yarns can be collected from Guardian pharmacies for those wishing to help provide warm clothing for the next northern hemisphere Winter.
May 10th, 2008
Graham Bell
Ken [2]:
Not quite homeless Ken.
Out in this part of the Other Australia, some couldn’t keep up with house loan repayments and have sold “their” houses on a rent-back basis. In reality, they were the bank’s or the finance firm’s houses in which they had a hitherto increasing equity – and, because of the “unfashionable” area and styles of the dwellings, the loans were ALWAYS more disadvantageous and more costly than were housing loans for the “deserving” customers in more “fashionable” area.
It’s good fun offering the poorer members of society an opportunity to improve themselves and then create conditions which snatch that hope away, isn’t it?
WHEN the cost-of-living makes it impossible for such people to pay the rent …. who do you think will recruit these people? A homegrown demagogue who will make you really nostalgic for the return of gentle, reasonable Pauline? A Made-in-Australia version of Hamas or Hizbollah? Super-gangs?
Do try to look beyond statistics alone to the human beings behind those statistics.
Lorikeet [6]:
…. in keeping with traditional Australian Values, of course.
[and on 9]:
The black economy is probably back bigger-and-better than ever – and after an absence of over half-a-century, we can look forward to the return of the black market too.
May 10th, 2008
Lorikeet
Marilyn:
I think you are mostly correct in what you’ve said on this issue. I don’t think the truth is an attack, when it applies to the majority of the population.
May 10th, 2008
muzzmonster
Ken and Lorikeet: The percentage of Australians under the age of 19 is about 28% (yes, I downloaded this figure from the ABS website), so it’s more than likely that 16% of Auatralians don’t earn any income.
And Arjay, I think your calculation of dividing GDP by number of workers contains inaccurate assumptions. We pay for all sorts of things other than simply someone else’s wages.
May 11th, 2008
philip travers
I didn’t want to destroy Marilyn,because she has proven herself pretty worthy ,elsewhere at Senator Bartlett’s. I was just being a reminder service,and not for the senile,but,maybe the honest in opinion to sharpen their tools more appropriately.Pensioner matters are driving pensioners crazy at the moment,an unfair bundle mostly as the age sector,and I am over fifty, has to adjust again to the craziness of dependency on how government assess people,and wether to load them up in some ways as cheats. So,I will look crazy about this…I dont think anyone who can buy a $57.000 car or more is a social misfit,a major cause of pollution,or even devious in nature,a recidivist who has stolen money off a drug addicted rapist who won Lotto.Nor do I think even the very elite luxury car owners are of that making.Where the problems lies for government is are we really trying to stop these purchases ,and ,if ,not, how to increase the revenue from! But ,if,no purchaser can be hanged by implication as any type of crook,incl. tax evasion,then it is unfair,and non-progressive in a social sense.And if that,maybe both economic and even environmental.Because a lot of the later models are much more environmentally friendly than their earlier productions.So the car buyers will also lose some value at resale time if a government tax is released onto that.If all the potential buyers of these cars were asked “Would you be interested in a scheme that transfered your car to those less fortunate than yourself”, the answer will be. In the details.Then there is the problem of heaps of cars around,always ready to sell,and no-one buys for whatever reason.And ,yet, there was some evidence very early models,and the unusual,probably incl.extreme luxury cars in that,made.. people sit up and take notice they were on the road! So the very poor ,the very rich,and a few weirdos keep the rest of the populace in cars alert.A case for a few cars and trucks belching out black stuff!
May 11th, 2008
Lorikeet
I’ve thought of more instances where people might record a “nil income”.
1. Parents who are full-time carers of babies and young children.
2. Women under Age Pension age who haven’t worked since their first child was born.
3. People who put nothing on the census forms for themselves or their co-habitants – but scribble obscenities all over it, and then ask for a privacy envelope.
4. People who don’t fill out their census forms honestly.
5. Traders setting up stalls in large shopping centres (who seem to be there permanently) but don’t seem to give out receipts.
The Trade Practices Commission is clearly not doing its job.
May 11th, 2008
Marilyn
Philip, pensioners in Australia are not really doing it that tough. I live on a pension and my life while simple is not poverty stricken.
Most of the pensioners own their own homes, those who rent do get rent assistance and we don’t have pensioners out with their begging bowls on every corner.
We need to get a grip on reality here in Australia and just stop this wretched whinging about every thing that we perceive we should have.
May 11th, 2008
Kiashu
Ken, you didn’t understand why there were two sets of figures. It was individual income and household income. A fair percentage of individuals earn nothing at all; but almost everyone lives in a household, and even if they don’t get cash, get the indirect benefits – shelter, food, lighting, and so on.
So that household income is the more important figure. And we see that the median income is about $80,000 – half the households earn more, half earn less. I think this is a very respectable number, more than sufficient.
What’s of concern is the lower-income households – 10% earn $25,000 or less – and that the top 10% earn $172,000 or more, effectively seven times as much. Looking at the 5% and 95% figures, we can see that the top 10% of the country earns 10-20 times as much as the bottom 10%. So we could double the income of the poorest 10% with just one-twentieth to one-tenth the wealth of the top 10%. Yet we don’t.
This is important because we’re after quality of life for all Australians. And having your income go from $10,000 to $20,000 improves your life a lot more than having it go from $200,000 to $210,000.
May 12th, 2008
ken
I certainly did understand that difference Kiashu my incorrect assumption was that someone reproting on the distribution of income would have used those earning income as the dataset for that distribution.
May 12th, 2008
Naomi Cartledge
Marilyn, I disagree with you on the plight of pensioners, excluding myself. I rent a Dept of Housing unit, for 25% of my weekly income.I sew most of my own clothes(and for grandchildren etc)sew my own curtains,cushions etc.I don’t eat red meat,and don’t buy luxury foods at all.I think I live OK but I find it impossible to replace white goods for instance. My frig was given to me but is about 20 yrs old,too small,and mustn’t be as efficient to run or greenhouse gas emission friendly as a more modern one. Can’t get a loan due to inadequate income,although people including pensioners are offered plastic cards for ridiculous amounts(Insight last week-one couple had 5 I think).
There’s 100,000 homeless people in Australia every day.I find this very disturbing, particularly as the stereotype ‘alcho’ has been replaced by families including children.A big contributor to this is the lack of investment in public housing.The local realtor magazine had at least 6 Dept of Housing homes for sale by auction in 1 week.I don’t think they were privately owned as the ad had them in a block.Why aren’t families put in these?Maybe they’re being sold to build a few townhouses on the block but if not it’s a disgrace I feel.
The rent market has escallated in price to an alarming level in NSW.There’s also a shortage.I understand that some people are paying a years rent in advance to try and ‘win’ the deal.The World Today had a special report on homes being repossessed last Sept-Oct which was very distressing. Some Estate agents of 30 yrs experience haven’t ever seen it as bad as now.The human toll is pretty sad & desperate. I acknowledge that many people have overestimated their abilities to repay loans, and haven’t factored in job losses or increases in family size perhaps,but it’s still a tragedy for many, with accompanying stresses, illnesses and family breakdowns.Whatever the reasons,the end result effects us all really, either in social,health including mental health costs etc.
May 12th, 2008
philip travers
Disagree Marilyn.I notice much going on about Libraries etc.If Pensioners, do not want certain things,matters changed because they can be done better,or just a heap of understandings,that arent the cliche’ rocket science,but come from perserverance and just long observation over time..this country is doomed.Some whinges of pensioners are so well related,well presented, well intention,and like you here,at the moment,pretty short in delivery,compare that with others,and..What’s wrong with pensioners whingeing! Just read about a rape of a 82 year old by a youth in Sydney.. our society doesnt need this behaviour.If x number of pensioners whinge about this,good on them! After all rapes are certainly one to many,a 82 year surely shouldn’t even expect this stuff to happen to them or people their age.You cannot laugh this off,really,although the victim,may have more psychological reserves than others,one shouldn’t be… “such is life”.Perhaps some Pensioners need to know how to offend people in these circumstances,so the power of the young prick is lost and ashamed.You can only do things like that,if the older sections of society still regularly express themselves in new and confounding ways.Go on Whinge! In defiance… and with right on one’s side,and a sense of humour,that can be only owned by that person expressing it.Devastate.. so as maybe someone young,may understand the power of words sometimes.
May 12th, 2008
Graham Bell
Marilyn [15]:
That’s quite a sweeping statement.
Yes, there are retirees who do spend their days playing the pokies or flitting around all over the place; ones who can buy a wall-sized plasma TV or a $500 present for a grandkid on a whim. Such people really do exist – I have met quite a few of them.
There are, too, retirees who own their own substantial house – which needs no major repairs; who drive a late-model car – which is also in excellent repair; who do not want for any household appliance; who are covered by comprehensive private health insurance; who have substantial savings to cope with any emergency or celebration …. and jolly good luck to them!
But please do not extrapolate from such very fortunate retirees to stereotype all pensioners.
Nor should you be tempted to follow the dingo-pack and blame those pensioners who, through no fault of their own, have not been able to retire with a solid house, a flash car, every imaginable convenience and a bank-account full of loot. All you need is a bad business deal, an abrupt change in government policy, a catastrophic accident, the collapse of an industry; a corporate take-over …. and all your careful plans and savings for retirement can be gone in an instant.
I too – out of necessity, not choice – live on a pension. Retiring as a wealthy superannuant or as a partner in a profitable business would have been so much nicer. Yet I am far more fortunate than many pensioners in that my upbringing has given me the skills to live very frugally indeed and my needs are very simple – with only one minor, low-cost, harmless, easily-abandoned indulgence.
Just be aware that there really are some pensioners and other retirees who are doing it very tough indeed.
May 12th, 2008
Arjay
Muzzmonster,I was being conservative in my average of $40,000.It is more like $32,000 for an average wage.This means the average wage earner, produces an extra $68,000 above their gross wage,pays personal tax,GST,stamp duty petrol tax,and a multitude state charges as well as pays for the multi nationals,share holders etc.
No wonder ordinary Aussies feel screwed and poor!!Stuff the Greens and their guilt trips.We in NSW cannot build two power Stations in 7 yrs without selling off our most prized asset to the Communist Govt of China.China is bringing a new power station on line every month.They want to buy our power.Why can’t we develop our own power when we sell China most of it’s high grade coal?The tail is wagging the dog!!
May 12th, 2008
Lorikeet
Arjay:
The MINIMUM wage in this country is about $30,000 – e.g. for an adult kitchenhand, cleaner or Assistant-in-Nursing.
We lost nearly all of our permanent AiNs at the nursing home to greener pastures – including ATSI, PNG, Asian and black African workers. That’s how great the minimum wage and working conditions are.
The MEDIAN wage would be about $70,000, I think.
I don’t know what the AVERAGE wage is, but I’d guess it could be between $40,000 and $50,000.
I think Andrew Leigh’s figures are grossly flawed – not necessarily his fault. I believe there are far more people raking in much higher incomes than those declared.
Yes to your comments on China and “the tail wagging the dog”. We need to be aware of where this is leading – global communism.
Graham Bell:
Our pensioners are paid far less than in some European countries. I agree that circumstances of pensioners vary greatly, as do those of wage earners.
I was agreeing with Marilyn’s general comment about people’s greed and unrealistic expectations.
May 13th, 2008
philip travers
I will apologise unreservedly to Marilyn ,and those who have disagreed with her still have my support.When I read Naomi’s ,stuff,Naomi seems a real young name,hardly any were around when I was growing up,perhaps she was a Pioneer with that name.And I liked what she said about her self-sufficiency.I love darning socks!Can you believe it! I suppose because,my mother did it well,I can overcome a Beatles song,and have piles of bloody socks ready to wear.And Marilyn is sort of right,its easy being self-sufficient away from the greed types. But it is sort of relative,because when I just worked by myself organizing the local tip,what people threw away just pissed me off no end. What really annoys me about a low comparative income is the cost of things,sometimes,and the endless wait because of,and the scattered brains who seem to earn high incomes,but, when they open their mouths,must be rubbish in absolute garbage out.Is it important for me to think I should defer my own sense of being intelligent.. to morons!? Not Quite.
May 13th, 2008
muzzmonster
Yes Arjay, we all pay taxes. And we all get something back from the government for them – even if you don’t receive a direct government benefit (pension, dole, whatever). We get roads, police, education, medical services, a justice system, etc.
May 13th, 2008
Lorikeet
Phil:
Yes, some excellent wisdom there! It doesn’t really matter WHAT you have. Friends and family are far more important.
We could probably clean up the environment quite a bit if people would only learn the value of a dollar and make good use of the items they have.
Surely it wouldn’t be too hard for the government to give out tax credit vouchers to people supplying secondhand clothing and goods, to be sold at low prices to the poor.
The Pine Rivers Shire Council (now part of Moreton Regional Council) has 2 big garbage tips, where it sells unwanted goods for its own profit. “Fossicking” was banned years ago – such was the high quality of the booty.
A lot of people are now successfully selling unwanted goods on ebay.
What we really need is a budgetting thread.
For those who are struggling to make ends meet, here is a short list of staple foods which could be kept in the pantry and/or fridge/freezer, for times when nothing flies out of the wallet except hungry moths.
Flour
Sugar
Milk Powder
Rice
Pasta
Rolled Oats
Wheat biscuits (Weetbix style)
Snack crackers
Bulk packs of dried fruit
Bulk packs of roasted peanuts (shelled)
Dried lentils, beans, split peas
Frozen vegetables
Baked Beans
Sardines
Buy only the generic brands, and weekly specials (only if they are cheaper). If absolute desperation occurs, I think white rice is still the cheapest tummy filler.
A man answering ninemsn poll said he didn’t think that he and his wife (earning $150,000 between them) were well off!
May 14th, 2008
Tony
Lorikeet:
Well if they had a normal mortgage of about $500,000 (On that salary probably more) they would be paying approx $48000 per year in mortgage payments. Plus if they had 2 school age kids at private school they would loose another $22k to $25 (Grammer Schools much higher of course) If they only had one car being paid off that would take chew up another $6000 per year. The other one could catch the bus for $1800 per year. Rates $7500 per year.Private health (Compulsory) at that scale ($5000). Tax Based on two 75K salaries = $36816 (2007 levels)electricity $4200 per year. After school care $6800 per year. Fuel for the Car and 4 quarter services $3870. Shool uniforms and School books for 2 students($2000)Medical and dental including medicines etc $2500. Food say plain label only for 4 $11440 per year.That would leave them negative -$10926.
If the kids were at primary the school fees would be lower but child care would be higher. At lease one of the workers would have to be a member of a professional body and require updated training. $1K – $2K
So maybe his right ?
Tony
May 14th, 2008
Lorikeet
Tony:
Sending kids to private schools is a luxury many people could not afford.
To my knowledge, you live in Brisbane, where there is still no need for anyone to have a $500,000 mortgage with only 2 children – unless they want a house that is too big and fairly ostentatious.
Rates where I live are a little over $2100 a year – not $7500. Are you sure that’s not for the sum total of his property portfolio?
Many people could not easily afford $5000 for private health insurance, which also sounds like an extraordinarily large amount.
No, the man claiming he is not well off must be in that position because he lives at “Snobville”, on an acreage property, with his very spoilt and overindulged family, who do not count their blessings or share their largesse with anyone.
He would only be in a negative position because he chose it, and probably also because he couldn’t accurately calculate his annual costs.
His food bill is much too high also. There are people living in other countries who get almost nothing to eat.
I know of an Australian divorced mother who has only $5.00 left to buy food for her children after paying her bills.
I have absolutely no compassion for couples earning $150,000. Bring on the harps and violins!
May 14th, 2008
Graham Bell
Lorikeet [25]:
Very sensible list. :-)
*Salt.
*Yeast spread [Promite, Marmite, Vegemite, etc.; can also be used to make a refreshing and quite cheap nightcap - just add hot water.]
*The most inexpensive form of your favorite condiment [pepper? mixed herbs? chili? - if you are not a penitent, why not savour a little luxury?]
*Vinegar.
May I suggest a few few non-edible items too?
*Soap.
*Dishwashing liquid.
*Laundry detergent.
*Genuine hard wax polish [for everything from shoes to furniture to carpentry].
*Low power lights [you would be amazed at just how little light you actually do need to get around in the evening - except in places where you are reading, cooking or sewing].
*Good quality toilet paper [has multiple uses].
Buying specials and generics is good only if they are real bargains – always check the volume/weight/quality of the ’special’ against that of the regular item. Some ’specials’ aren’t! [thanks to the weakest consumer protection laws in the civilized world].
By putting on warm socks, a beanie and a coat or bulky jumper, you can delay putting on a horrendously-expensive heater in the evening for several weeks as winter comes on. Likewise, having your shower or tub in late afternoon, before the bathroom gets freezing cold, can save a heap in electricity bills.
I am proud of being reasonably well-dressed, of having my library stocked and of having my dwelling furnished by Vinnies’, Sally’s, Lifeline, the missions and all sorts of other charity shops as well as by the dump recyclers in the regional city, garage sales and by swapping with neighbours.
I might have to be very patient until something suitable turns up and to compromise when it does – but I do live as well as I can on my meagre pension …. and perhaps even a bit better than some on ten times my income.
Tony [26];
We do live in two very different worlds. :D
May 14th, 2008
Tony
Lorikeet:
Even if they paid no rates it would still leave them in a minus positon.
Not everyone believes and accepts that the state school system is an acceptable environment for their children.(most would have them in private if they could). The truth is that many couples work 2 jobs and long hours to keep their children out of the state system.
If you think that $220 in grocery shopping for 2 adults and 2 school age children then I think you should think again.
….. This exercise was to show you what young professional couples face today when getting married and having a family.
Are you suggesting that everyone throw all their responsibilties at the state and go out and buy an investment portfolio ?
I’m sure we already have enough of them
Tony
May 15th, 2008
Lorikeet
Gee Tony, maybe you need some help in learning how to make money go further. Graham Bell has given us further excellent suggestions.
The education system isn’t any good whether you go for state or private schools, because the starting pay for teachers in Queensland is only $41,000, and the students are not well disciplined.
What is the $7,500 in rates paying for? To pay that amount, you would normally need to own more than 3 suburban houses.
I’m sure readers are well aware that I wasn’t suggesting anyone go out and buy an investment portfolio.
A person with primary or high school aged students would not normally have a $500,000 mortgage, unless they have blown all of their money previously, and just bought a very nice property.
People who can afford to send their kids to private schools and buy extraordinarily expensive health insurance need not whinge to those living below the poverty line – or to anyone – about being in the red.
BTW my husband and I had 2 of our children when we were only 20. We both had to work full-time jobs on relatively low incomes (no government help with child care costs) just to keep an extremely modest roof over our children’s heads.
I’ve lived among people who could barely afford vegemite sandwiches for their kids.
Your extremely privileged example of poverty needs to learn to live within its means – not whinge about extreme self-spoiling after they have overspent.
May 15th, 2008
Graham Bell
Tony and Lorikeet:
There are probably a lot of people with a $500 000+ mortgages and although the local authority here doesn’t yet charge $7 500/annum rates on houses, I don’t find those figures unbelievable at all.
Private schools? A supplementary charges boost the costs of sending kids to them. Will you really deprive your children by not paying for them to participate in non-curriculum activities? Can they participate in similar activities in the wider community [i.e., in clubs] at a fraction of the cost?
Everyone:
If you are very fortunate you will have a landlord who does maintenance and is is prompt in doing repairs – or, if you are a home-owner, have family and friends who can help you keep the place in good repair.
Chances are though, if you are living modestly, you’ll be living in a place long overdue for repairs. Regardless of whether you are renting, paying it off or own your place outright – you will need:
* a claw hammer [carpenter's hammer].
* some fine nails, some clouts [short thick nails with flat heads] and some bigger nails [50mm or 65mm are big enough]
* a pair of screwdrivers [a Phillips head and a flat].
* a tape measure.
* an old pair of reasonably sharp scissors.
* a hacksaw [with a new blade - properly tightened - unless you enjoy trips to Casualty/A&E].
* a small wood saw.
* a sharp wood chisel.
* a packet of assorted wood screws.
* a pair of inexpensive safety goggles.
* a packet of paper disposable dust-masks.
* a shifting spanner.
* a few hot-water tap washers.
* a roll of white Teflon pipe-thread tape.
* a breast drill and some drill bits [or an electric drill - in perfect condition - if you are given one].
* a few sheets of different grades of sandpaper.
* a small tin of sewing machine oil.
* a shovel
* a sense of humour.
You can pick up most of these items for a song by rummaging through a few garage sales. Thus equipped, you can keep your dwelling in good repair – at minimal cash cost. Have fun! :-)
May 15th, 2008
The Feral Abacus
Graham Bell, you forgot the gaffer tape!
May 15th, 2008
Graham Bell
The Feral Abacus:
Indeed. Sorry. Thanks for mentioning it. :-)
Everyone:
please add:
* a small roll of gaffer tape.
* a small packet/roll of steel wool – many uses – including plugging mouse/rat holes [they don't like the taste of it; it gets caught in their teeth too].
* BIG coffee or pickle glass jars – vermin-proof and keeps stuff fairly fresh [many charity shops charge $2 or $3 for them but go on, have a splurge and buy two of them each payday or pension day - they soon pay for themselves in what's saved].
* a basic do-it-yourself/handyman book – from the same charity shop.
Don’t be frightened to go into a charity outlet shop or a recyclers – nobody’s going to see you and the volunteers in there are lovely people [never ever struck a crook one yet]. Just look around, take what you want to buy to the counter and pay for it; no need to explain why you are there instead of at where you used to shop. Easy. :-)
Andrew Bartlett:
Hope you don’t mind that Lorikeet and I used up so many bytes with a “shopping list” on your blog – but hope it helps people who might be completely unaccustomed to having to skimp and scrounge.
May 16th, 2008
Lorikeet
Tony:
Large amounts of public money go into private schools, so people are landing education costs on the public purse by sending their kids there as well. Private schools double-dip from parents and government.
Another reason people complain about having no money is that they send their kids to too many expensive activities outside of school. It’s about competing with the Joneses, generally at the expense of homework.
May 16th, 2008
Tony
Graham:
#31 The rates figure was a typing error it should have read $2500 but has no relavance in the exercise. There are a number of living costs left out which would make up the difference. These couples work long hours, probably attend sport, school functions with their kids etc with little time off so being a handyman might just eat into their sleep time.
Tony
Tony
May 16th, 2008
Pete from Perth
Lorikeet @22: “The MINIMUM wage in this country is about $30,000 [...] The MEDIAN wage would be about $70,000, I think.”
A quick bit of info re stats. Consider this set of numbers: 1 2 3 4 5 6 100.
The Median is 4. The Average/Mean is 17.29.
If you want to get an idea of what Joe Bloggs is paying, look for the median. If you want to fudge the figures (as our government routinely does), use the average.
May 17th, 2008
Graham Bell
Tony [35]:
That’s alright; did wonder about some other costs you hadn’t mentioned though.
What does worry me is that such people are being run to the limits of their time, their money, their skills – and at tremendous social, marital and personal cost. You could even say those in Australia’s “middle class” are being run as though they are in a wartime economy. So when a real emergency arises, they will have been “running on Empty” for ages …. what happens then?
And for what benefit?
Their expensive houses cannot fail to lose relative value in the coming years; their expensive cars will wear out …. worse yet, despite massive investment into the private schooling of their children, most of these children now face rapidly declining opportunities.
These are people who should be able to save and to invest in productive enterprises and genuine wealth-creation; they should be able to engage and support local tradesmen and businesses and to stimulate the entry of innovative products onto the market …. yet many now find it impossible to avoid going backwards let alone save a single cent.
This is a recipe for social and political turmoil …. and for inevitable personal ruin.
The situation is bleak but it is far from hopeless.
There are paths out of this mess – but all of them require firmness, specific knowledge about the options, discipline, staunch resistance to peer-pressure and a willingness to make radical and necessary changes to one’s whole lifestyle.
Sadly, for some, the challenges of being resolute enough take those paths are beyond them.
Pete From Perth [36]:
Good one!
No, no, the government does not fudge figures nor tell lies to us; they are simply give us an alternative truth. :-)
May 17th, 2008
Lorikeet
Pete from Perth:
A guy on TV the other night said the average wage was $58,000 to $63,000.
Tony:
Your friends could still fix their financial problems by living more ordinary lives.
They earn enough money to pay tradesmen to do everything and have a lovely holiday each year – but they must not live within their means in other ways, and quite clearly never have.
May 17th, 2008
Daniel Taylor
I think Senator Bartlett is right on the money here. Throwing more Money at politicians doesnt create better politicians. Look at John Howard. We need to look at the whole Australian political system and also include political donations here. As Kevin 07 says “It needs to looked at from root to branch”
May 20th, 2008
Tony
Graham:
#37 Phone (Mobile required) Dry Cleaning and additional clothing costs (required for professionals) professional body memberships
(Required by most) additonal insurance for professionals(required by most). Maybe a dinner out once every month or so plus the show for the kids once a year, etc etc etc
Thats not being over the top just what you or the kids would expect
Tony
May 21st, 2008
The Feral Abacus
Tony: phone, insurance & membership fees for professional organisations are all deductible, and dry cleaning and clothing expenses may be too, depending on circumstances.
And given that half of Australia’s households have incomes that are at least $69k lower, expenses of this order appear trifling.
The chances are that something like 80% of the people reading this blog will belong to households with incomes lower than $150k. Your comments may be interpreted by many of them in much the same way that Marie Antoinette’s remarks on bread and cake were received.
May 21st, 2008
Lorikeet
Feral:
Too right!
Tony:
Most drycleanable clothing can be put through a washing machine on gentle, wool cycle.
Just find out what the suits are made of and launder a full load – saves water and power. Drycleaning is outrageously priced and inconvenient too.
Better still – buy suits that say they are machine washable, and put ties through machine in a washbag.
Hang carefully to minimise ironing. Ask relatives for wrinkle-free shirts at Xmas.
May 22nd, 2008
Graham Bell
The Feral Abacus [41]:
Tax deductions are way off on the far distant horizon. The expenditure – for those who had been tricked or goaded or fooled into living way beyond their means – is happening now, when such people may actually be short of groceries and be wondering how they will be able to get to work next week.
Being asset-rich [wtf??] and cash-poor is not all that rare.
It is tempting to sneer at people for allowing themselves to get into such a mess …. but I won’t. I’m just lucky enough to have picked up a few of the skills and hints that allow me to get by somehow …. and if I can learn them, so can anyone else.
May 22nd, 2008
The Feral Abacus
Graham Bell: sure, deductions are a form of future income.
But let’s not forget that many high-income earners get mobile phones or laptops as part of their salary packages. They also qualify for forms of tax minimisation unavailable to those on lower incomes.
Nevertheless, I wouldn’t deny that anyone, regardless of income, can find themselves in financial difficulty. And there’s no doubt that $150k or so won’t go a long way in prime inner-city Sydney, for instance.
But the upthread focus on the difficulties of making ends meet on high incomes seems desperately out of touch with the everyday experience of the majority of Australians.
We shouldn’t that many couples with mortgages and with school-aged children are making do on $70k or less. Even though these families have tax breaks over singles on comparable incomes, many need to budget carefully. And I know I don’t need to remind you or Lorikeet that there are many others who face far more severe long-term financial constraints.
Let’s focus our attention on where the real needs lie.
Cheers, TFA
May 23rd, 2008
Lorikeet
Last night on the television news, a reporter said there are 100,000 people living on the streets of Brisbane, for whom warm blankets and clothing are needed.
No doubt they will also need food.
The Salvos are supposed to be collecting donations this weekend.
May 23rd, 2008
Tony
Lorikeet:
I think the numbers could even be higher. I know of volunteers that go out at and deliver hot drinks etc to the homeless. (Been thinking of doing it myself). I was recently visiting a solicitors office in the valley and when entering the car park, I realised I was on the wrong floor, when I entered the staircase there was a number of young women with blankets etc living in the stairwells. I’ll dig deep if the salvos make it here.
Tony
May 23rd, 2008
Lorikeet
That’s good, Tony.
A lot of the homeless have mental illnesses, or alcohol, drug or gambling addictions.
It would help if the government didn’t finance teenagers leaving home instead of fitting in with their parents – not all of them come from bad homes – another example of the negative empowerment of children.
The young women you saw could end up having to prostitute themselves in order to survive. That could lead to drug addiction (or vice versa) which could then lead to mental illness.
There are plenty of good reasons to build more (affordable) public housing and units.
Many years ago, the government closed down a lot of mental health facilities – another major contributor to the homelessness problem.
Fortitude Valley is a dangerous place to be even in the daytime. Going there gives me the creeps.
May 24th, 2008
muzzmonster
I find 100,000 homeless in Brisbane hard to believe. After all, given a population of about 1 million, that’s 10%. I can believe 100,000 in Brisbane struggling to make ends meet though.
And not sure what your comment on Fortitude Valley is all about. I used to work there and never felt unsafe. Sure there are some unusual people there, but they are pretty harmless – I also get them on my train home.
May 25th, 2008
Lorikeet
Muzz:
The current population of Brisbane is about 2 million. In the 2006 census, there were about 1.73 million.
In the shires/councils surrounding the metropolitan area, there would be at least hundreds of thousands more who wouldn’t be counted as Brisbanites.
At the end of last year, there were about 100,000 homeless people living in a “tent city” in Paris. Its population is only slightly greater than ours.
If you spread 100,000 people out across a sprawling city like Brisbane, I guess you could miss them. They would probably only hit the parks, stairwells and alleyways once the city closed down for the night.
I often see people still sleeping in parks at midmorning in the CBD.
There are plenty of drunkards, rabble rousers and displaced people hanging around the streets of Fortitude Valley, even in the daytime.
Most workers are inside buildings for most of the day.
Outside can be quite a different kettle of fish. When you’re walking down Brunswick Street, you have to watch out you don’t get caught up in the middle of drunken brawling.
May 25th, 2008
The Feral Abacus
Depends on which definition of ‘homeless’ is being used.
Whereas most people would think of the homeless as being those who sleep rough, professionals working in support services may also include those people who are living in transient arrangements, eg sleeping on friends’ sofas.
To put the 100,000 in context, there were about 1000 people sleeping rough in the city mile in Adelaide a few years ago. So I’d guess that either the 100,000 includes people with transient accommodation, or there’s one to many zeroes in the number.
Whatever the case, its far too many. The rapid escalation of homelessness over the last 15-20 years is the clearest indicator possible that social policy has failed a large chunk of the population.
May 25th, 2008
Lorikeet
Feral:
An aid agency in the city said it was turning 7 out of 10 homeless people away every night.
What social policy? I guess it must be the one that closes down mental health facilities, encourages young people to defy their parents, and makes a heap of revenue from alcohol and gambling.
May 26th, 2008
LORIKEET
I have come upon a new set of statistics for the homeless. According to a pamphlet I received from Mission Australia last week, there are 100,000 homeless people in the whole of Australia – not just Brisbane alone, as previously televised.
I have also done a bit of homework on the minimum adult wage. It is currently $13.20 an hour. That’s $528.00 for a 40 hour week, and $27,456.00 per year. However, not everyone gets 40 hours of work every week.
Jun 16th, 2008