Budget a missed opportunity to connect with young voters

labor’s cash handouts cannot disguise the fact that its budget fails to address the policy concerns of young voters. By Freya Leach.

First published in The Australian

Labor piggybacked into government on young people’s votes. Now it is in power, Anthony Albanese is using cash handouts, like raising Youth Allowance, to distract us from the fact he’s failing to address any of the underlying causes of economic and social distress experienced by young people.

Polling shows there are three critical issues facing young people: climate change, mental health and housing. Instead of offering solutions, all this budget guarantees is higher inflation, higher unemployment, higher taxes and a more acute housing crisis.

Like it or not, the environment is the greatest political concern for young Australians. But we should not replace a “climate crisis” with an economic crisis. Albanese promised 97 times that power prices would go down by $275, but from July they will skyrocket by 33 per cent for 1.6 million households. Labor is being deceptive with young voters about the real implications of its net-zero plan. Distributing renewable energy across the country will require the nation to fork out $100 billion on 28,000km of new transmission lines.

But Labor’s only response to this energy blunder is to hand out $500 energy rebates. These alone will cost taxpayers $3bn. And that cost will be thrown on to the pile of intergenerational debt we’re already saddling on to future taxpayers – or today’s young people.

Despite the enormous economic and environmental costs of exclusively using renewables, Labor is even refusing to consider small modular nuclear technology. It’s safe, reliable, can be plugged into the existing grid and creates zero emissions.

For a self-titled “progressive” government, it seems irrationally conservative to refuse to even consider nuclear power already being used by 32 countries worldwide. Anthony Albanese promised to end the “climate wars” and adopt evidence-based energy policy. But the PM’s over-commitment to renewables – flying in the face of mounting evidence about the potential of nuclear energy to be both cheap and emissions-free – seems like the most baseless, costly and blindly ideological position we have seen to date.

The second greatest challenge Labor is failing to tackle is the mental health pandemic gripping young Australians. It’s the biggest public health issue facing my generation. One-third of young people have suffered an episode of mental illness by age 25.

Mental illness and suicide account for 14.2 per cent of Australia’s total health burden – or 374,000 years of healthy life lost. Despite this, Labor has slashed the number of Medicare-subsidised psychology sessions from 20 to 10.

One of the key drivers of mental illness is loneliness. While everyone wants to rinse their hands of the Covid-19 era, for a 20-year-old like myself, 10 per cent of my life has been spent in lockdowns. I completed year 12 and my first year of university while in lockdown. We should not neglect the impact this has had on young people – both in terms of education and mental health.

The only extra funding given to mental health services was the creation of 500 additional psychology training placements (costing $91.3m) and $260.2m to support people with severe mental illness access more psychosocial support.

More money is not necessarily the answer. The scale of the problem means clinical intervention focusing on each individual will be unavailable to all those who need it. Instead, we must look to broader strategies.

We need to look at policies that encourage civic participation and family formation. These could include tax incentives for intergenerational living like a tax credit for renovations intended to accommodate multi-generational living (as already exists in Canada). Community service should also be integrated into secondary and tertiary education to promote participation in civil society. Finally, housing is the greatest economic barrier facing young people. By the time Baby Boomers were 30 years old, 50 per cent owned their own home. For Millennials, that number has declined 37 per cent.

More than 70 per cent of young Australians believe they will never be able to own a home. Being blocked from this Australian aspiration is making it harder for us to have families and feel connected to our communities. High inflation is pushing up interest rates, which is limiting people’s borrowing capacity. The corresponding decline in house prices is being cushioned by the increase in net migration.

This dynamic of high inflation and high migration makes homes even less affordable. The budget will only exacerbate this dynamic. Labor is bringing in 1.5m migrants over the next five years. A significant chunk will be international students. They will be competing for the same affordable housing that young Australians like myself want to be purchasing as our first homes.

Labor knew this would be a problem ahead of the election. It promised to build 30,000 social and affordable houses. Albanese has failed to deliver, and will build just 1200 dwellings in each state and territory over the next five years.

This is cold comfort to young people who are faced with a migration surge equivalent to the size of Adelaide. Moreover, net migration is not being matched with adequate infrastructure investment. In the October Budget, Chalmers scrapped $9.6bn in planned infrastructure. In the latest Budget he cut another $1.7bn from road projects. Now the Infrastructure Minister is undertaking a “review” of the $120bn infrastructure pipeline which will likely result in further cuts. Ultimately, it is young people who will bear the cost of Labor’s budget. Inefficient action on climate change, inadequate mental health policies and unsustainable levels of migration contribute to the sense of hopelessness so many in my generation feel.

Amid the undersupply of housing, net migration surge and decline in infrastructure investment, Labor’s only plan is to raise the rate of commonwealth rent assistance by 15 per cent. With 38 per cent of renters already on the maximum rate of rent assistance, my fear for young people is that this will simply flow through to prices and drive rents up even further.

Labor wants all the benefits of migration – filling skill shortages and making up for stagnant productivity – without paying the costs of increased housing supply and infrastructure.

Freya Leach is a research fellow at the Menzies Research Centre.