What do you think?
Rate this book
Safety Net: The Future of Welfare in Australia
The welfare state is one of the crowning achievements of the twentieth century, giving citizens access to healthcare, pensions, disability and unemployment benefits. This unprecedented expansion of the state was a product of the postwar period of the late 1940s, when governments ramped up investment in this grand safety net. By the 1970s, half of all government spending went towards social-welfare programs, but today the welfare state stands at a crossroads, beset both by political opposition and funding pressures as the population ages.
Australian Labor Party MP Daniel Mulino provides a sweeping account of the history of welfare in Australia and abroad, from Bismarckian Germany to present-day Canberra. In this deeply researched and lucid account, Mulino looks to the challenges facing today’s welfare state and reflects on what steps must be taken to protect and extend it.
Australian Labor Party MP Daniel Mulino provides a sweeping account of the history of welfare in Australia and abroad, from Bismarckian Germany to present-day Canberra. In this deeply researched and lucid account, Mulino looks to the challenges facing today’s welfare state and reflects on what steps must be taken to protect and extend it.
525 pages, Kindle Edition
Published August 16, 2022
7 people are currently reading
43 people want to read
Ratings & Reviews
Friends & Following
Create a free account to discover what your friends think of this book!
Community Reviews
Displaying 1 - 3 of 3 reviews
December 28, 2024
The ‘safety net’ is the master metaphor of the Australian welfare state. If Australians fall from some desired or prior position, especially in employment and health, government benefits stop them hitting – at least with full force – the hard ground of poverty and illness.
Daniel Mulino’s central interest in this book is risk management; the implicit high wire walking or other risk taking in the safety net metaphor gets attention as well as what happens when people fall. In his economist’s perspective the costs of reducing risks must be compared to the cost of fixing problems after they occur (vaccines pass the cost-benefit test, annual medical check-ups for healthy people do not), but switching to a medical metaphor prevention is often better than a cure.
This interest in risk management sometimes takes Mulino’s book far from problems managed by government departments responsible for social benefits and services. A chapter considers the risks of climate change and war. Elsewhere Mulino mentions how limited liability companies redistribute risk (from shareholders to creditors), and discusses how private insurance markets, such as for property, manage risk and compensate for loss. These sections extend the book beyond the welfare state as usually understood.
Social welfare cash payments in Australia are generally safety net only. Australian unemployment and disability benefits only minimise extreme poverty, while the age pension supports just a frugal standard of living. But publicly-supported social services take on a larger role in smoothing consumption over time, with no or more generous means tests and benefits that are more fit for purpose.
In Australia education is the major example, reducing expenses for families and individuals during study periods while impliedly expecting (via taxation) or explicitly expecting (via HELP income contingent loans) payment later in life. Large-scale childcare subsidies are a recent extension of this kind of support. Childcare still has a means test, but it is much less stringent than tests applied to people facing serious hardship.
While smoothing is mentioned several times through The Safety Net, in policy terms at greatest length in considering new uses for income contingent loans, its most extended theoretical discussion appears in the second last chapter. I would have liked earlier and greater discussion of smoothing to widen the discussion away from adverse outcomes. Education, children and retirement are life events most people want to experience. These life phases need to be prepared for, but the associated risks are not the best primary intellectual framework for considering appropriate policy support.
As Mulino says, Australia’s welfare state is unusual in its low use of contributory social insurance schemes, which create a relationship between what citizens put in and what they are entitled to take out. Contributory schemes have a stronger smoothing function than poverty relief programs by leaving people in more similar positions before and after the insured event.
Compulsory retirement saving through superannuation from the early 1990s is the major departure from the non-contributory nature of the Australian welfare state. Unemployment insurance is the most obvious area where Australia could have a contributory system but does not, just a poverty relief payment set well below the minimum wage. Other countries offer people who have lost work much more assistance to maintain living standards during at least short periods of unemployment.
Australia’s welfare system keeps taxation as a share of GDP below that of many other countries, which in isolation I take as a positive. But my doubts about the relative merits of the Australian compared to other welfare systems have increased over time. This is partly due to limited support for the unemployed. My broader concern is that means testing imposes high ‘effective marginal tax rates’ (because people lose benefits and pay more tax at the same time) and creates an intrusive bureaucracy in Centrelink.
The Safety Net’s wide-ranging risk management analysis made it a different book to what I was expecting based on the welfare-focused title and back cover blurb. Reviewers should not complain when authors write the book they want to write, but potential readers should be aware that The Safety Net is not like most Australian welfare state literature.
History is essential for understanding the Australian welfare state (indeed any welfare state), but Mulino sometimes provides more historical detail than his analysis needs or most readers will want. Risk management practices in ancient agricultural societies, Aristotle’s role in the idea of marginal utility, Blaise Pascal’s 17th century contribution to the probabilistic maths underlying insurance, and Bismark’s social welfare programs in late 19th century Germany were for me moderately interesting diversions rather than necessary evidence.
Despite these criticisms, The Safety Net impressively integrates international academic thinking on risk with details of Australia’s welfare state. Mulino is a sitting Labor MP in the federal parliament. In the new government I hope he can bring a broader theoretical perspective to policy debates.
Daniel Mulino’s central interest in this book is risk management; the implicit high wire walking or other risk taking in the safety net metaphor gets attention as well as what happens when people fall. In his economist’s perspective the costs of reducing risks must be compared to the cost of fixing problems after they occur (vaccines pass the cost-benefit test, annual medical check-ups for healthy people do not), but switching to a medical metaphor prevention is often better than a cure.
This interest in risk management sometimes takes Mulino’s book far from problems managed by government departments responsible for social benefits and services. A chapter considers the risks of climate change and war. Elsewhere Mulino mentions how limited liability companies redistribute risk (from shareholders to creditors), and discusses how private insurance markets, such as for property, manage risk and compensate for loss. These sections extend the book beyond the welfare state as usually understood.
Social welfare cash payments in Australia are generally safety net only. Australian unemployment and disability benefits only minimise extreme poverty, while the age pension supports just a frugal standard of living. But publicly-supported social services take on a larger role in smoothing consumption over time, with no or more generous means tests and benefits that are more fit for purpose.
In Australia education is the major example, reducing expenses for families and individuals during study periods while impliedly expecting (via taxation) or explicitly expecting (via HELP income contingent loans) payment later in life. Large-scale childcare subsidies are a recent extension of this kind of support. Childcare still has a means test, but it is much less stringent than tests applied to people facing serious hardship.
While smoothing is mentioned several times through The Safety Net, in policy terms at greatest length in considering new uses for income contingent loans, its most extended theoretical discussion appears in the second last chapter. I would have liked earlier and greater discussion of smoothing to widen the discussion away from adverse outcomes. Education, children and retirement are life events most people want to experience. These life phases need to be prepared for, but the associated risks are not the best primary intellectual framework for considering appropriate policy support.
As Mulino says, Australia’s welfare state is unusual in its low use of contributory social insurance schemes, which create a relationship between what citizens put in and what they are entitled to take out. Contributory schemes have a stronger smoothing function than poverty relief programs by leaving people in more similar positions before and after the insured event.
Compulsory retirement saving through superannuation from the early 1990s is the major departure from the non-contributory nature of the Australian welfare state. Unemployment insurance is the most obvious area where Australia could have a contributory system but does not, just a poverty relief payment set well below the minimum wage. Other countries offer people who have lost work much more assistance to maintain living standards during at least short periods of unemployment.
Australia’s welfare system keeps taxation as a share of GDP below that of many other countries, which in isolation I take as a positive. But my doubts about the relative merits of the Australian compared to other welfare systems have increased over time. This is partly due to limited support for the unemployed. My broader concern is that means testing imposes high ‘effective marginal tax rates’ (because people lose benefits and pay more tax at the same time) and creates an intrusive bureaucracy in Centrelink.
The Safety Net’s wide-ranging risk management analysis made it a different book to what I was expecting based on the welfare-focused title and back cover blurb. Reviewers should not complain when authors write the book they want to write, but potential readers should be aware that The Safety Net is not like most Australian welfare state literature.
History is essential for understanding the Australian welfare state (indeed any welfare state), but Mulino sometimes provides more historical detail than his analysis needs or most readers will want. Risk management practices in ancient agricultural societies, Aristotle’s role in the idea of marginal utility, Blaise Pascal’s 17th century contribution to the probabilistic maths underlying insurance, and Bismark’s social welfare programs in late 19th century Germany were for me moderately interesting diversions rather than necessary evidence.
Despite these criticisms, The Safety Net impressively integrates international academic thinking on risk with details of Australia’s welfare state. Mulino is a sitting Labor MP in the federal parliament. In the new government I hope he can bring a broader theoretical perspective to policy debates.
November 2, 2022
Very profoundly written and covers diversified topic including social economy and risk management.
December 20, 2023
I am far more optimistic about the future of the federal caucus after reading this.
Displaying 1 - 3 of 3 reviews