Gen Z: not off the treadmill yet
It is challenging to represent the millions within the Gen Z cohort. Born between the mid-to-late 1990s and 2010, Gen Z comprises at least a significant portion of the Australian population and occupies diverse life stages. Some have started families, while others reside in share houses or with their parents. Despite these differences, many share a common sense of uncertainty.
I was born in the year 2000. Each morning, I encounter real-time global conflicts that feel apocalyptic. The Treasury’s “worst-case scenario” modelling provided a strangely comforting perspective.
Jim Chalmers said this year’s budget would address “intergenerational fairness”.
I hope reforms to negative gearing and capital gains tax will serve their intended purpose for my generation, many of whom are currently locked out of the housing market. Rebalancing the property market away from investors should facilitate first home buyers’ entry. The government estimates that 75,000 first home buyers will be supported over the next decade.
An investment of $59.4 million to provide social housing for more than 4,000 people aged 16 to 24 at risk of or experiencing homelessness may offer some relief to Gen Zers. Perhaps, eventually, housing in Australia could be regarded as a human right rather than merely an investment asset.
It remains uncertain whether young renters will benefit from the property tax reforms. However, no changes will be swift enough to address the recent unaffordable rental increase my housemates faced, forcing us back onto the Sydney market with only a month's notice. The burden of HECS debt also dampens morale, and the budget provided no relief in this area. We will observe how effective any enhancements to Medicare prove when we are no longer eligible for basic healthcare.
Many in Gen Z are on a treadmill, channeling their wages into rent and bills or living at home with parents while saving for a home deposit.
It sounds great to have a goal of home ownership, but that still seems a long way off.
– Ima Caldwell
Millennials: young parents can’t catch a break
I have a challenging mortgage and two children, living in a regional Queensland town with minimal public transport. The government has been promising reform, which implies change – and frankly, life feels quite pressured at present.
The primary question young parents across Australia will ask following the budget announcement is: “Where is the relief for my family?” Unfortunately, this does not appear to be a cost-of-living relief budget.
The capital gains tax changes and the elimination of negative gearing for all but new properties slightly shift the investor market in favour of first home buyers, though I am not one. Nonetheless, I am pleased for those who are. For many millennial friends, especially those renting in capital cities, this budget offers some hope. An optimist might suggest my children will face a very different housing market when they reach adulthood.
Additionally, an extra $2 billion will support infrastructure for housing developments nationwide, facilitating an estimated 65,000 new homes over the next decade. This budget is rich in housing announcements, which I hope will be sufficient to make a meaningful difference, enabling young Australians to purchase their own homes.
What does this mean for me and my children? Not much, unless I decide to have another child. From July, the government will provide paid parental leave for a full six months.
The $10 billion fuel security package and $2.55 billion allocated to reduce the fuel excise and heavy road user charge for three months may assist my diesel-driving partner’s expenses. It may also reduce supply chain costs associated with grocery delivery to my regional town, provided major retailers like Woolworths and Coles pass on these savings to customers, which historically has been uncertain.
This budget comes from a prime minister who stated that universal childcare would be his legacy, yet childcare was not mentioned in the treasurer’s speech. The government argues there are limits to what can be done, especially considering the war in Iran.
The costs of childcare, medical appointments, and groceries received little attention, casting doubt on the political will to provide parents with relief. As a millennial mother, I often find myself too occupied managing daycare illnesses to engage in political advocacy.
“What’s in this for me and my kids? Well, not a whole lot unless I decide to have another.”
– Molly Glassey
Gen X: a late shot at home ownership
Generation X, defined as those born between 1965 and 1980, is a relatively small cohort familiar with Walkmans, Discmans, and iPods.
We are often the sandwich generation, caring for aging parents while raising children. Time is limited and expenses are substantial.
The budget offers limited cost-of-living relief but focuses on reform, with no immediate measures to ease daily financial pressures. However, increased spending on healthcare, including public hospitals and urgent care clinics, is a positive development.
My reaction to the budget is not one of lament because enacting reforms is preferable to providing short-term financial fixes.
Financial constraints exist, but it is generally more difficult for those born after us. Many Gen Xers secured mortgages and began raising families before living and education costs escalated.
The tax reforms, specifically ending negative gearing for most future investors and reducing capital gains discounts, serve the public interest.
Government data indicates these tax benefits have been heavily concentrated among Australia’s highest earners.
The reforms target future investors while preserving most tax benefits enjoyed by boomers. While some Gen Xers may be prevented from becoming significant landlords, these changes benefit the country and younger generations, including our children.
The reforms may also assist some Gen Xers who had abandoned hopes of home ownership to purchase their permanent residence.
The writer Damian Barr compared the pandemic’s inequity to being in the same storm but on different boats.
The quote could apply to the re-emerging cost-of-living crisis. Boomers have the cruise ships and younger generations have the dinghies. Gen X has an old fishing trawler; it’s not luxurious but it’s better than a rubber ducky.
– Jonathan Barrett
Boomers: we also have children and parents
Not all Australians in their 60s and 70s are affluent; many boomers are pensioners. However, as a group, boomers are disproportionately wealthy, and with Labor focusing on intergenerational equity, some budget savings target asset-rich boomers.
The most notable measures include winding back the capital gains tax discount and negative gearing, which have contributed to soaring property prices, making housing unaffordable for younger generations. There is also a crackdown on family trusts used to minimize tax.
Similar to the recently enacted tax increase on large superannuation balances, these measures are justified on grounds of fairness.
While these changes will not resolve the housing affordability crisis immediately, they are generally acceptable, even among boomers. Intergenerational equity requires compromises; I want my children in their twenties to be able to purchase a home soon, ideally without relying on parental financial support.
Regarding health, the private insurance rebate for those over 65 will be reduced, with savings redirected to aged care. Labor states that maintaining an age-based concession has become “harder to defend.” However, this may increase pressure on public hospitals if many seniors relinquish private coverage.
On the expenditure side, aging boomers will inevitably increase demand on health and aged care services. The budget allocates additional funds for public hospitals, urgent care clinics, new medicines including vaccines on the pharmaceutical benefits scheme, and more aged care beds, home care, and dementia units. Being at the younger end of this cohort, aged care is not yet a personal concern but is relevant to my parents’ generation in their 80s, and thus important to me.
I am disappointed by the lack of emphasis on clean energy. The global fuel crisis presents an opportune moment to accelerate the transition from fossil fuels. The budget could have included a gas windfall profits tax to fund renewable energy initiatives. Future Australians would have appreciated such measures – a true act of intergenerational equity.
The changes won’t fix the housing affordability crisis overnight but I think they pass the pub test, even among boomers. Intergenerational equity requires trade-offs; I want my twentysomething children to be able to buy a home in the near future (preferably without the bank of mum and dad).
– Susan McDonald
