How Much Money Is Spent On Welfare Each Year By The Federal Government?

Welfare spending generally aims to improve the social and economic wellbeing of the population. It is singled-out from health spending in that it focuses on measures such as income back up and social and economic employment-related programs and services (for example, unemployment relief and family and relationships services).

See the Australian Institute of Health and Welfare's Health expenditure Commonwealth of australia series for more information on health spending.

Both the Australian Regime and the state and territory governments contribute to welfare spending, as do non-government organisations and individuals. The Australian Government primarily contributes through cash payments relating to its areas of responsibility, every bit divers in the Australian Constitution (which include family allowances, unemployment benefits and pensions); information technology also contributes to sure welfare services. U.s.a. and territories focus more on providing welfare services.

Information on welfare spending that is funded by non-government sources (for case, where a welfare service is funded by donations or fees rather than through government funding) are non readily available in Australia and are not included hither.

See Philanthropy and charitable giving for some information on non-government donations.

Government welfare expenditure in Australia

In 2019–20, government spending on welfare services and payments was $195.7 billion. The Australian Government funded the majority of this amount (88% or $171.5 billion), with the remaining 12% funded past country and territory governments.

Nearly welfare expenditure data

Where possible, welfare spending estimates have been developed for consistency with the Australian Health and Welfare's Welfare Expenditure Australia series of publications. This ensures trend information are consistent.

Constant prices and 'real terms'

Spending is reported in abiding prices (that is, adjusted for inflation) except where noted. The employ of constant toll estimates indicates what the equivalent spending would take been had 2019–20 prices applied in all years, as it removes the inflation issue. The phrase 'real terms' is also used to describe spending in constant prices. On this folio:

• abiding cost estimates for spending were derived using deflators produced past the Australian Bureau of Statistics
• the Consumer Toll Alphabetize was used for cash payments, and the government last consumption expenditure (implicit price deflator) for welfare services and tax concessions.

Comparability with other welfare spending estimates

To maintain historical comparability, the Youth Allowance (Students and Other), Austudy and the Aboriginal and Torres Strait Islander Study Help Scheme (ABSTUDY) are not included in the welfare spending estimates presented on this folio. Therefore, these estimates are non comparable with figures reported elsewhere (such as in the Treasury Final Upkeep Outcome).

Land and territory welfare expenditure

The most contempo welfare expenditure data available for state and territory governments are for the 2015–16 financial yr, every bit published in the 2017 Indigenous expenditure report (Productivity Commission 2017), which includes data for both indigenous and non-Indigenous welfare service expenditure. Country and territory information were estimated for 2016–17 to 2019–twenty using available trend information from the Ethnic expenditure study and from Government finance statistics (GFS) 2019–20, in which the Classification of the Functions of Government – Commonwealth of australia (COFOG-A) was used (ABS 2015, 2021b). In previous reports, the GFS was based on the older Government Purpose Classification (ABS 2005).

Hence, the estimated fourth dimension series data on this page are not fully comparable with data published previously. Whatever additional spending on welfare services by us and territories related to either the 2019–xx bushfires or the coronavirus 2019 (COVID-xix) are likewise not visible in these information.

Sources of data

Data are sourced from the welfare expenditure dataset of the Australian Institute of Wellness and Welfare, which is, in turn, sourced from publicly bachelor data from:

• the Australian Agency of Statistics
• the departments of Education, Skills and Employment; Wellness; Prime Minister and Cabinet (PM&C); Social Services; the Treasury; Veterans' Affairs
• the National Disability Insurance Agency (NDIA)
• the Productivity Commission.

Information for 2018–19 and 2019–20 are extracted from the corresponding reports of these organisations (ABS 2021b; Department of Educational activity, Skills and Employment 2020, 2021; Department of Health 2020, 2021; Section of the Treasury 2021; Department of Social Services 2020b, 2021b; Department of Veterans' Affairs 2020, 2021; NDIS 2021; PM&C 2020, 2021; Productivity Commission 2021).

Trends in welfare expenditure

In 2019–twenty, the Australian and state and territory governments spent $195.7 billion on welfare. In existent terms (that is, adjusted for inflation), this represented a 12% growth in spending from 2018–19 – an boosted $21.v billion. This real growth was much college than the average growth over the catamenia from 2001–02 to 2019–20 (3.v% per annum) (Effigy 1). The main driver of this high growth rate in 2019–20 was the economic measures the Australian Government implemented from March 2020 in response to the coronavirus 2019 (COVID-19) pandemic.

See COVID-nineteen economical response measures.

Before 2019–20, and before these COVID-19 measures, welfare spending in Commonwealth of australia had more often than not grown at a similar stride to population growth, with real spending fluctuating at around $6,985 per person since 2014–15. In 2019–20, real spending increased past effectually 11% to $7,668 per person.

This welfare spending relates to spending across the entire population and non spending per eligible person in detail programs or spending per benefit recipient. This more than detailed analysis is not included on this page.

This line chart shows that total regime welfare expenditure increased steadily from $106.3 billion in 2000–01 to $195.7 billion in 2019–twenty. Per person regime welfare expenditure increased from $5,481 in 2000–01 to $7.668 in 2019–20. Both total regime welfare expenditure and per person government welfare expenditure rose sharply during the Global Financial Crisis (GFC) in 2008–09.

This line graph shows ratios of welfare expenditure to tax revenue and Gross domestic product for the period 2001–02 to 2019–twenty. The average ratio of welfare expenditure to tax revenue was 33 percent over the period just peaked during the GFC in 2008–09. Similarly, the authorities welfare expenditure to GDP ratio was stable though it rose sharply to 10.iii% in 2008–09.

This line graph shows that cash payments has been larger than welfare services, followed past departmental administration costs over the whole period. Greenbacks payments increased steadily over the menstruum 2009–x to 2015–sixteen before decreased in the side by side three years, then rose sharply in 2019–xx. Over the same flow, welfare services increased steadily most of the years except a slight decrease in 2013–fourteen.

This line graph showing regime welfare expenditure by targe grouping over the period 2009–10 to 2019–20. Over the menstruation, the welfare expenditure for older people has been larger than for people with a disability, families and children, followed by unemployed people and other welfare groups. The welfare spending on unemployed people, people with a disability, older people and families and children increased in 2019–twenty while the expenditure on other groups decreased over the aforementioned period.

This line graph shows the number of welfare benefit recipients for eligible unemployed people over the menstruum Quarter 3-2016 to Quarter two-2020. The recipient number was quite stable over the period up to the third quarter in the financial year 2019–20 at about 700,000. Then the number of welfare benefit recipients peaked in the fourth quarter in this twelvemonth following the impact of the COVID-xix pandemic.

This line graph shows tax concessions past the Australian governments for welfare by target groups in the flow 2009–ten to 2019–twenty in constant prices. Over the menstruation, the tax concessions for older people has been larger than those for families and children, followed by those for other groups. The revenue enhancement concessions for older people was quite stable over the period 2009–ten to 2013–fourteen before increased steadily in the adjacent five years, and then decreased in 2019–xx. The revenue enhancement concessions for families and children have remained stable over the period.

This horizontal bar chart shows welfare expenditure as a proportion of GDP across OECD countries in 2017. Finland had the highest proportion (22%), followed by France and Italy (21%). Mexico ranked the lowest (almost iv%). Australia ranked below the OECD median.

Source: https://www.aihw.gov.au/reports/australias-welfare/welfare-expenditure

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