Welfare expenditure grows 15% in 2003-04

Welfare spending by governments, non-government community services organisations and households was nearly $80 billion in 2003-04 according to the Australian Institute of Health and Welfare's latest expenditure report, Welfare Expenditure Australia 2003-04.

Mr John Goss of the Institute's Expenditure and Economics Unit said this is an increase of 15%, or more than $10 billion since 2002-03.

Welfare expenditure on older people accounted for the largest share of the $80 billion total ($28 billion) followed by families and children ($27 billion) and people with disabilities ($14 billion). The remaining $11 billion was spent on a range of other groups.

Of the $80 billion welfare expenditure, $20 billion was spent on welfare services - an increase of $2.4 billion, and an 8.3% increase over the previous year.

'This was higher than the growth in any year in the last five years, and was mostly due to a 38% increase in funding from non-government community services organisations,' Mr Goss said.

Welfare services for older people was the area of most rapid growth in funding by the Australian Government, averaging 11% per year from 1998-99 to 2003-04.

On a per person basis, expenditure on welfare services (in current price terms) in 200304 was $1,006, up from $655 in 1998-99.

Almost half of the expenditure incurred by non-government community services organisations was funded by governments with a further 25% funded by clients' fees for services, and 26% from the non-government community services organisations own funding sources.

The greatest percentage of household contributions (83%) was in the form of client fees for services provided by non-government community service organisations. An additional 10% was spent on services provided by governments, and the remaining 7% for informal child care.

In 2003-04, total welfare concessions to households (including Australian Government tax expenditures) were estimated at $22.2 billion. Most of this (92.8%) was in the form of Australian Government social tax expenditures or tax exemptions for individuals. About three-quarters of this amount went to older people with the remainder going to families and others, such as low income earners.

7 September 2006

Further information: Mr John Goss, AIHW, tel. 02 6244 1151, or mob. 0402 346 379.

Ms Maneerat Pinyopusarerk, AIHW, tel. 02 6244 1161.

For media copies of the report: Publications Officer, AIHW, tel. 61 2 6244 1032.