editorial baby payments to welfarefuturedirections.org.au/wp-content/uploads/2013/08/... ·...

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T he facts worldwide on obesity are shocking — what was once the disease of high-income nations is now spreading in epidemic proportions to developing countries still struggling to cope with malnutrition. Even in sub-saharan Africa, which continues to face serious problems with undernutrition, obesity is on the rise, particularly among urban populations. In a global food system where 870 million people are undernourished, a staggering 29 million deaths worldwide each year result from overeating. This global obesity epidemic threatens to weaken and even reverse progress made in economic development and tackling poverty throughout the Indian Ocean region. Until recently, obesity in developing countries was considered a problem of the elite, but experience is showing the problem spreading to groups further down the socioeconomic scale. In parts of Africa and South Asia, these are the people who can’t afford nutritious food. Throughout the world, a “nutritional transition” is occurring as people abandon traditional diets for energy dense, Western-style processed foods. Globalisation causes this transition to happen rapidly and at lower income levels in the developing world because of exposure to new global food systems. For instance, new production processes have created an abundant supply of cheap vegetable oils that allow low and middle-income households to increase their energy consumption. Urbanisation is one of the driving forces behind such changes. Urban populations are more exposed to food marketing and imported processed foods through supermarket chains and fast-food restaurants. Lifestyle changes involving more sedentary occupations, and more women in the workforce, mean less food is prepared in the home, with more reliance on takeaway and street food. South-East Asia has been facing rising obesity levels for more than a decade, as its countries industrialise and incomes rise. Indonesia, Thailand and Burma all have levels of overweight between 20 per cent and 40 per cent and increasing problems with childhood obesity. India, which has one of the world’s biggest problems in feeding its people, is also facing an emerging obesity epidemic. It is disturbing that Australia has one of the highest rates of obesity in the region. The prevalence of obesity has more than doubled in the past 20 years and it is now the single biggest public health threat facing the nation. The cost of obesity to Australia’s collective wellbeing is equivalent to about 8 per cent of the economy’s annual output. Obesity is not yet as big a problem in the Indian Ocean region as hunger, but if trends continue, overeating will pose a grave situation for health and nutrition. As rates of obesity grow, the impact on health and on labour productivity threatens to undermine development hopes. Governments in developing countries are having to deal with health problems associated with overweight and obesity before they have the financial means to do so. Without structural changes to food systems, obesity is likely to continue to grow in the developing world even as the problem of hunger continues. Countries such as India and Indonesia, which are experiencing rapid growth, could be confronting big increases in obesity rates in coming decades. Estimates for direct healthcare costs associated with obesity range between 2 per cent and 8 per cent of total healthcare expenditure globally. This figure will increase as the obesity pandemic continues to spread. The World Health Organisation reports that each year, 100 million people are pushed into poverty because they have had to bear the cost of paying directly for health services. In Tanzania, for instance, where obesity levels are rising, especially among women, the cost of diabetes treatment is 25 per cent of the minimum wage. In addition to burdening the healthcare system, obesity incurs considerable indirect costs for national economies because it lowers work productivity. By reducing people’s capacity to work, obesity then becomes a driver of household poverty. In many parts of the developing world, households now face a dual burden, with increased consumption of energy-dense processed foods that are low in vital nutrients leading to people being overweight while still suffering from micronutrient deficiencies. Many households buy these foods because they are cheap and better alternatives are not widely available to the urban poor. In many countries there seems to be a lack of will to direct attention towards obesity in places where it occurs alongside chronic undernutrition. But failure to address this issue could have serious consequences for the health and aspirations of people in the developing world. Lauren Power is a research analyst with the Global Food and Water Crises research program for Perth think tank Future Directions International The global paradox of obesity and hunger Developing countries face a potentially economically crippling epidemic, writes Lauren Power Signed Alston prints are available from Press Photos. Phone 9482 2378. Established 1833 Tuesday, August 20, 2013 16 OPINION thewest.com.au Email [email protected] EDITORIAL S uccessive Federal governments have been criticised for squandering the China-fuelled mining boom which has underpinned the national economy for a decade — and middle-class welfare has been pinpointed as a culprit. The vote-winning potential of government handouts was identified early by John Howard, and the former prime minister used targeted payments very effectively in his bid to wrest the “Howard Battlers” from their traditional political champions in Labor. The expansion of family tax benefits A and B and the decision not to means-test the private health insurance rebate and the baby bonus were glaring examples of people receiving money when they arguably did not need it. Opposition Leader Tony Abbott makes no secret of the fact that he models himself on Mr Howard. The coalition’s paid parental leave scheme takes the concept of middle-class welfare, perfected by his mentor, to a new extreme. Under Mr Abbott’s plan, new mums would get 26 weeks paid leave at their actual wage plus superannuation contributions, to a maximum of $75,000. Women earning the generous salary of $150,000 would be paid, over the course of half a year, about $10,000 more than Australia’s average full-time salary. Mr Abbott has trumpeted statistics showing a woman earning about that average full-time salary, $65,000 a year, would get $32,500. This is $21,000 more than under Labor’s current scheme, which pays all new mothers earning less than $150,000 18 weeks at minimum wage, or $622 a week. The coalition believes an increase in productivity and workforce participation will be a benefit flowing from the scheme but improvements in these areas would have to be marked to justify this multibillion-dollar cost. Mr Abbott has blunted an obvious criticism — that it is wrong for taxpayers on modest wages to subsidise the family aspirations of wealthy citizens — by making business pay for the scheme. This is a cynical move, given the coalition’s PPL would start on the same day that a cut to the company tax rate to 28.5 per cent would come into effect — July 1, 2015. About 3000 companies with a taxable income of more than $5 million would contribute to the PPL’s $5.5 billion annual cost. Leaving aside the questions over whether the 1.5 per cent levy will cover the entire bill, potentially exposing taxpayers, there will still be a sting in the tail for less-well-off Australians. The cost will inevitably be passed on to consumers in the former of higher prices for goods and services. Many of the companies which will foot the bill will be publicly listed. Shareholders, many of whom will likely be the same comparatively well-off people who will receive the generous PPL scheme, will not soften their demands for robust profit margins and dividends. Mr Abbott’s policy will feed this country’s addiction to welfare at a time when a stalling economy means we can least afford it. Baby payments feed addiction to welfare

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Page 1: EDITORIAL Baby payments to welfarefuturedirections.org.au/wp-content/uploads/2013/08/... · 8/20/2013  · South-East Asia has been facing rising obesity levels for more than a decade,

The facts worldwide onobesity are shocking —what was once the diseaseof high-income nations isnow spreading in epidemicproportions to developingcountries still struggling

to cope with malnutrition. Even in sub-saharan Africa, which

continues to face serious problemswith undernutrition, obesity is on therise, particularly among urbanpopulations.

In a global food system where 870million people are undernourished, astaggering 29 million deathsworldwide each year result fromovereating. This global obesityepidemic threatens to weaken andeven reverse progress made ineconomic development and tacklingpoverty throughout the Indian Oceanregion.

Until recently, obesity in developingcountries was considered a problem ofthe elite, but experience is showing theproblem spreading to groups furtherdown the socioeconomic scale. In partsof Africa and South Asia, these are thepeople who can’t afford nutritiousfood.

Throughout the world, a “nutritionaltransition” is occurring as peopleabandon traditional diets for energydense, Western-style processed foods.Globalisation causes this transition tohappen rapidly and at lower incomelevels in the developing world becauseof exposure to new global foodsystems. For instance, new productionprocesses have created an abundantsupply of cheap vegetable oils thatallow low and middle-income

households to increase their energyconsumption.

Urbanisation is one of the drivingforces behind such changes. Urbanpopulations are more exposed to foodmarketing and imported processedfoods through supermarket chains andfast-food restaurants. Lifestylechanges involving more sedentaryoccupations, and more women in theworkforce, mean less food is preparedin the home, with more reliance ontakeaway and street food.

South-East Asia has been facingrising obesity levels for more than adecade, as its countries industrialiseand incomes rise. Indonesia, Thailandand Burma all have levels ofoverweight between 20 per cent and 40per cent and increasing problems withchildhood obesity.

India, which has one of the world’sbiggest problems in feeding its people,is also facing an emerging obesityepidemic.

It is disturbing that Australia hasone of the highest rates of obesity inthe region. The prevalence of obesityhas more than doubled in the past 20years and it is now the single biggestpublic health threat facing the nation.The cost of obesity to Australia’scollective wellbeing is equivalent toabout 8 per cent of the economy’sannual output.

Obesity is not yet as big a problem inthe Indian Ocean region as hunger, butif trends continue, overeating will posea grave situation for health andnutrition. As rates of obesity grow, theimpact on health and on labourproductivity threatens to underminedevelopment hopes.

Governments in developingcountries are having to deal withhealth problems associated withoverweight and obesity before theyhave the financial means to do so.

Without structural changes to foodsystems, obesity is likely to continueto grow in the developing world evenas the problem of hunger continues.

Countries such as India andIndonesia, which are experiencingrapid growth, could be confronting bigincreases in obesity rates in comingdecades.

Estimates for direct healthcare costsassociated with obesity range between2 per cent and 8 per cent of totalhealthcare expenditure globally. Thisfigure will increase as the obesitypandemic continues to spread.

The World Health Organisationreports that each year, 100 millionpeople are pushed into povertybecause they have had to bear the costof paying directly for health services.In Tanzania, for instance, whereobesity levels are rising, especiallyamong women, the cost of diabetestreatment is 25 per cent of theminimum wage.

In addition to burdening thehealthcare system, obesity incursconsiderable indirect costs fornational economies because it lowerswork productivity. By reducingpeople’s capacity to work, obesity thenbecomes a driver of household poverty.

In many parts of the developingworld, households now face a dualburden, with increased consumptionof energy-dense processed foods thatare low in vital nutrients leading topeople being overweight while stillsuffering from micronutrientdeficiencies. Many households buythese foods because they are cheap andbetter alternatives are not widelyavailable to the urban poor.

In many countries there seems to bea lack of will to direct attentiontowards obesity in places where itoccurs alongside chronicundernutrition. But failure to addressthis issue could have seriousconsequences for the health andaspirations of people in the developingworld.Lauren Power is a research analyst with theGlobal Food and Water Crises researchprogram for Perth think tank FutureDirections International

The global paradox ofobesity and hungerDeveloping countries facea potentially economicallycrippling epidemic, writesLauren Power

Signed Alston prints are available from Press Photos. Phone 9482 2378.

Established 1833Tuesday, August 20, 201316

OPINION thewest.com.auEmail [email protected]

EDITORIAL

Successive Federal governments havebeen criticised for squandering theChina-fuelled mining boom whichhas underpinned the nationaleconomy for a decade — and

middle-class welfare has been pinpointed as aculprit.

The vote-winning potential of governmenthandouts was identified early by JohnHoward, and the former prime minister usedtargeted payments very effectively in his bidto wrest the “Howard Battlers” from theirtraditional political champions in Labor.

The expansion of family tax benefits A andB and the decision not to means-test theprivate health insurance rebate and the babybonus were glaring examples of peoplereceiving money when they arguably did notneed it.

Opposition Leader Tony Abbott makes nosecret of the fact that he models himself onMr Howard. The coalition’s paid parentalleave scheme takes the concept ofmiddle-class welfare, perfected by his mentor,to a new extreme.

Under Mr Abbott’s plan, new mums wouldget 26 weeks paid leave at their actual wageplus superannuation contributions, to amaximum of $75,000.

Women earning the generous salary of$150,000 would be paid, over the course of halfa year, about $10,000 more than Australia’saverage full-time salary.

Mr Abbott has trumpeted statisticsshowing a woman earning about that averagefull-time salary, $65,000 a year, would get$32,500.

This is $21,000 more than under Labor’scurrent scheme, which pays all new mothersearning less than $150,000 18 weeks atminimum wage, or $622 a week.

The coalition believes an increase inproductivity and workforce participation willbe a benefit flowing from the scheme butimprovements in these areas would have tobe marked to justify this multibillion-dollarcost.

Mr Abbott has blunted an obviouscriticism — that it is wrong for taxpayers onmodest wages to subsidise the familyaspirations of wealthy citizens — by makingbusiness pay for the scheme.

This is a cynical move, given the coalition’sPPL would start on the same day that a cut tothe company tax rate to 28.5 per cent wouldcome into effect — July 1, 2015. About 3000companies with a taxable income of morethan $5 million would contribute to the PPL’s$5.5 billion annual cost.

Leaving aside the questions over whetherthe 1.5 per cent levy will cover the entire bill,potentially exposing taxpayers, there willstill be a sting in the tail for less-well-offAustralians.

The cost will inevitably be passed on toconsumers in the former of higher prices forgoods and services. Many of the companieswhich will foot the bill will be publicly listed.

Shareholders, many of whom will likely bethe same comparatively well-off people whowill receive the generous PPL scheme, willnot soften their demands for robust profitmargins and dividends. Mr Abbott’s policywill feed this country’s addiction to welfareat a time when a stalling economy means wecan least afford it.

Baby paymentsfeed addictionto welfare