Last year Australia’s 200 richest individuals increased their wealth by 23% to $167.25 billion. That’s an average of over $800 million each!
At the top of the list is mining magnate Gina Rinehart, who more than doubled her personal wealth to over $10 billion.
The world’s biggest mining company, BHP Billiton, announced the biggest profit in corporate history, with an 86% increase on net profit. This means that BHP pocketed nearly $65 million a day in the last financial year!
To put the scale of wealth inequality into perspective, while Gina Rinehart was increasing her personal wealth by over 50%, if you are on the minimum wage your personal wealth decreased by 0.2% over the same period. And for many people it decreased even more than that.
Wealth inequality in Australia is so extreme that for the top 50 corporate CEO’s, their pay packets are now around 100 times the average workers’ wage! They got a pay rise on average of $940,000 last year. This is a rise of $18,000 per week, while the average wage rise for workers was just $62 per week.
While Australia’s rich have been getting richer, most people are struggling to make ends meet. While some argue the huge profits from the mining boom will ‘trickle down’ to the rest of us, this is simply not the case.
Australia’s natural resources should be used to benefit all Australians, not to create billionaires out of a tiny minority of privileged elite. This can only be achieved by bringing Australia’s resources into public hands, under community control. Then this money could be used to improve the lives of ordinary people, not to buy super-yachts for the super-rich!
Australia has some of the lowest tax rates in the developed world. Beyond this, the mining industry enjoys up to $10 billion in tax breaks and subsidies annually. This means the government is essentially waiving 43% of the mining sector’s corporate tax bill!
If Australia collected the same proportion of GDP as tax revenue as the UK does, an extra $108.1 billion would have been available for public spending. This is more than the entire amount that the Australian federal government spends on health and education put together!
Rather than increasing the tax burden on ordinary people, the super-rich should be taxed more. A massive amount of wealth exists in society. The problem is that it is extremely unequally distributed.
While taxing the rich is a good start, it will not be enough to lift people out of poverty and provide long-term increased funding for public services. We would also need to bring the key parts of the economy into democratic public ownership. On this basis a sustainable plan of production could be developed.
The massive amounts of wealth created could be used to fund a greatly increased minimum wage and reduce the taxes paid by ordinary people. At the same time we could invest in an expansion of public services, creating jobs as well as improving living standards.