What is intergenerational fairness?

At the National Press Club, 2 Feb 2015, Prime Minister Tony Abbott responded to the question on the fairness concerns about the 2014 Budget by resorting to the argument that his government’s aim is to help future generations by reducing the debt burden they would inherit. Hence, he argues, the 2014 budget and his government’s debt reduction strategy aids intergenerational fairness. If we are to read between the lines of what Abbott said, current equity and fairness issues are of no account whatsoever in his or his government’s world view.

The government’s obsession with debt reduction is based on an absurd argument which conflates a government budget with a household budget. Economist, Warwick Smith explains here.

But apart from the simple (well not that simple) economics of it, there are other reasons why Tony Abbott’s rationale for budget cuts on the ground of intergenerational fairness hold no water. Investment spending in the present aids intergenerational well being – and fairness- into the future.

The most obvious way that this works is through investment in education and why the Gonski recommendations for an overhaul of school funding was so important.

The essence of the Gonski recommendations is that more resources need to be allocated to disadvantaged schools in order for disadvantaged students to have opportunities to achieve to the best of their ability and to level the playing field with students in advantaged well-off schools.

Similarly, investment in higher education and opening opportunities in universities for students from disadvantaged backgrounds helps to achieve intergenerational fairness.

More than that the investments in education support the well springs of economic growth – innovation and high level competency for the globalised labour market and economy of the 21st century.

The kind of debt reduction policy that the Coalition government wants to implement actually erodes the foundations for economic growth in the future. It sets up young people coming of age 20 or 30 years down the track for marginalisation in the emerging economy without the sort of investments in education that they need now.

However, it is not only a matter of investment in education. A quest for equity and fairness in the present through appropriate income support provisions, affordable housing including public/social housing, community services, and high quality and affordable health care all contribute to the capacity of future generations to do well, to expand the economy and participate as global citizens…. as well as do what they need to do to deal with the real threats they face in the future with global warming – in fact the Coalition government’s recalcitrant attitude on climate change and its retrograde step in abolishing the carbon tax will help to configure a huge burden on future generations.

Fairness for future generations is very much a matter of building social capital now. See my 2012 article here:








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