4.3  Receipt of government benefits

4.3.1  Social welfare transfers, Superannuation and housing assistance

Cash benefits were more concentrated amongst lower-income households in 1997/98 than in 1987/88, as Figure 6 shows. Households in the lowest five deciles received more on average in 1997/98 than their counterparts did in 1987/88, and households in the highest deciles received less. Changes in the receipt of cash benefits will have been affected by, amongst other things, the number of people eligible for assistance, the rate of benefits, the targeting of these benefits, and changes in population characteristics. For example, there was an increase over this period in the proportion of the population receiving the Unemployment Benefit, the Domestic Purposes Benefit and other taxable benefits, and the people receiving these benefits were concentrated in the lower deciles. Targeting of payments to families was also intensified in this period, with the abolition of the universal Family Benefit and the expansion of the income-tested Family Support Tax Credit.

Figure 6 – Average receipt of cash benefits, by income decile, 1987/88 and 1997/98

Note: Cash benefits comprise social welfare transfers, Superannuation and housing assistance.

4.3.2  Education

There is less of a clear pattern to the receipt of education benefits across deciles, as Figure 7 shows. This is largely because all households with children benefit from education spending and households with children are distributed across the income deciles (see Appendix Tables 4 and 5). Average receipt of education benefits increased between 1987/88 and 1997/98 in all of the lower deciles, but not in some of the higher deciles.

Figure 7 – Average receipt of education benefits, by income decile, 1987/88 and 1997/98

Some of this change in receipt of benefits will be due to changes in the composition of deciles and in particular the proportion of each decile constituted by households with children or households containing tertiary students. This is accounted for in Figure 8, which shows the receipt of education benefits per person aged 3-22 years. Average benefit per person was more even in 1997/98 than it was a decade earlier, with significant increases in the lower deciles, and in decile 8. These changes may in part be due to strong increases in tertiary education participation, particularly amongst people from lower-income families, together with the targeting of student support on the basis of family income. Changes are difficult to interpret by decile, however, because students from reasonably well-off families may nevertheless be flatting in low-income, “non-family” households. For this household type, there was a 43% increase in real average education expenditures (Appendix Tables 23 and 29).

Figure 8 – Receipt of education benefits per occupant aged between 3 and 22 years, by income decile, 1987/88 and 1997/98

Government spending on secondary education per household fell in most deciles between 1987/88 and 1997/98, reflecting a decline in the overall number of secondary students. On the other hand, early childhood education expenditure grew markedly, particularly for households in the lower half of the distribution, but this spending accounts for only a small proportion of overall education spending (Appendix Tables 9 and 16).