Selectivity and Targeting in Income Support: The Australian Experience

Abstract

The Australian income support system is often characterised as one of the most selective in the Western industrialised world. This paper examines the sense in which the Australian system is selective, and discusses the distinction between selectivity and targeting in income support provisions. The paper contrasts developments in social security outlays and recipient numbers over the last two decades with those occurring since the election of the Hawke Government in 1983 in order that the nature and impact of recent policies introduced to increase targeting can be identified. The statistical analysis indicates that increases in recipient numbers have been the dominant factor underlying the past growth in outlays, and illustrates how the targeting strategy employed in recent years has been primarily directed at restraining the growth in recipient numbers. In many areas, moves to increase income support targeting have not been accompanied by more highly selective provisions. Finally, a method is devised to measure the degree of selectivity in income support programs, and applied to developments over-the 1969-89 period in age pensions, family assistance and sole parent's pensions.