Economics expert: Budget could show more 'favouritism'

UNIVERSITY experts have warned Australians not to be surprised if the next Federal Budget shows more "political favouritism" and inequality.

A report, which University of NSW Australia Business School associate professor Gigi Foster and University of Queensland Economics professor Paul Frijters co-wrote, said last year's budget could almost have been written by the rich.

"Higher levies on the rich, such as higher marginal income tax rates at the top, are temporary whereas cuts to support for the poor, such as medical co-payments or the halving of unemployment support, are permanent," their report, published in The Conversation, said.

"Some changes could have been made but were not, such as superannuation tax concessions that heavily favour the rich and distort incentives."

They said abolishing the carbon tax mainly benefited coal-fired power station owners while university fee deregulation benefited top university administrators.

In explaining an increase in inequality in the budget, the authors used an example of an employee who uses technology in their job versus one who does not.

They said an income of an illiterate apple picker would not grow as much as a university-educated worker who relied on modern technology, such as computers, in their work.

Topics:  budget joe hockey politics

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