The NATSEM analysis

The majority of us on the right, when we're not laughing at the latest [conservative]=Hitler barrage, could've told you this.

The richest 40per cent of the population receives much less in government services and benefits than the rest of society, paying much more in tax than they receive back.

An analysis by the University of Canberra's National Centre for Economic and Social Modelling (NATSEM) shows households with incomes of $1240 a week or more make less use of education, health and other government services than those on lower incomes.

They also get less in family and other benefits.

NATSEM director Ann Harding told The Australian and Melbourne Institute's Sustaining Prosperity conference last week the Howard Government had reduced inequality in Australia.

Subsidised government services are worth between $260 and $300 a week for the poorer 60per cent of the population. Health services are the most important, worth an average $110-$130 for people on lower incomes.

The private health insurance rebate, which is concentrated among wealthier people, is worth an average of only $8 a week. The total government subsidy to the health services of the richer 40per cent of society is $78-$90 a week.

So what does this mean? Basically, those on lower incomes do 30% better out of socialised health care than the upper-middle and upper classes. But The Australian, understandably considering it's a newspaper and not a blog, doesn't seem to look enough at the interesting findings out of the study, which can be found here. So let's look at benefits and taxes per quintile:

  Quintile    Taxes paid  Benefits  Benefit/Tax $
 Lowest 20%:     64          507        7.92
 Second 20%:     138         530        3.84
 Middle 20%:     261         385        1.47
 Fourth 20%:     389         258        0.66
Highest 20%:     721         148        0.21
[Figures in $AU, per household per week.]
.
  Quintile    Private Income  Final Income  Change
 Lowest 20%:     47              489         +442
 Second 20%:     377             769         +392
 Middle 20%:     810             934         +124
 Fourth 20%:     1237            1106        -131
Highest 20%:     2051            1479        -572
[Figures in $AU. Final income=private income+benefits-taxes.]

Some facts can quite easily be worked out from these statistics:
- The top 20% of earners pay 46% of all taxes, the top 40% pay 71% of all taxes.
- Per dollar of tax paid, the poorest 20% get 38.6 times as much back in benefits than the richest 20%.
- The richest 20% earn 43.6 times what the poorest 20% earn, but end up with only 3 times the lowest 20% have after taxes and benefits are taken into account.

Now unfortunately, for some people who don't think income redistribution helps the poor extensively, these figures will be met with a non-sensical or rambling response. But it's clear that in the face of these statistics, the rich pay a far larger share of taxes, and the supposed "corporate welfare for the rich" doesn't actually work that way. It's welfare for the poor, paid for by the rich.

(Cross-posted to The House Of Wheels.)