Treasury did not model Australian budget's impact on women, officials admit

Treasury officials have admitted they did not model the impact of the 2017-18 budget on different Australian households.

Michael Brennan, the deputy secretary of Treasury’s fiscal group, says he also doesn’t think Treasury has begun work on Australia’s G20 commitment, from 2014, to analyse the tax system to see what impact it is having on women.

A week ago the National Foundation for Australian Women, in a new analysis, found the combined impact of the Turnbull government’s budget measures could hit women earning below-average wages with effective marginal tax rates of 100%.

It showed the combination of an increase in the Medicare levy, the freezing of family tax benefit rates, and earlier repayment requirements for student loans “are particularly harsh for women”.

The report, Gender Lens on the Budget, pointed out that women were overrepresented at lower-income levels and changes to government benefits and increases in taxes had a disproportionate effect on women.

Brennan told Senate estimates hearings on Monday he was not aware of the Office for Women, which is housed inside the Department of the Prime Minister and Cabinet, asking Treasury officials to consider the impact of 2017 budget measures on effective marginal tax rates (EMTRs).

“It is something we do look at from time to time, looking through the income scale with particular household cameos, where effective marginal tax rates might be particularly high, but I’m not aware that we’ve done anything for this particular budget,” he said.

Effective marginal tax rates are the proportion of an additional dollar of earnings that is lost to both income tax and the reduction of mean-tested government payments.

During its G20 presidency in 2014, Australia undertook to reduce the gender gap in workforce participation by 25% by 2025.

The former Abbott government said it would support Australia’s commitment to boost women’s workforce participation by delivering more affordable and flexible childcare, supporting businesses to create more flexible workplaces, and examining the tax and transfer system and its impact on women.

Brennan said: “It’s not under way, that I’m aware of, within the Treasury.”

The finance minister, Mathias Cormann, then interjected to say Treasury would take the question on notice.

“Because as outstanding as Mr Brennan is, he may not be aware of every last bit that is happening within the Treasury, so we might just take that on notice to see if we can further add to that answer, having gone through it,” Cormann said.

Labor senator Jenny McAllister later criticised the government for not focusing more on the gender pay gap and female participation.

“First we had a minister for women who was unable to answer basic questions about what role, if any, the Office for Women played in the budget process,” she told Guardian Australia. “Today we learn that no one was asked to calculate the real effect of this budget on Australian women.

“Like the rest of their government, Ministers Michaelia Cash and Cormann don’t seem to know or care how this government’s policies affect women,” she said.