Budgeting for gender equality

Following amendments to Victoria’s primary financial management legislation, the Financial Management Act 1984, gender equality must now be considered and promoted as one of the key principles of sound financial management.

This legislative action was in response to a recommendation of the Victorian Parliament’s Public Accounts and Estimates Committee, which conducted an inquiry into gender responsive budgeting.

By analysing public spending through a gender lens, gender responsive budgeting can help the government identify and fund measures that support more equitable outcomes.

Gender responsive budgeting is not about creating separate budgets for women or solely increasing spending on women’s programs, but rather about assessing the different needs and contributions of men, women and gender diverse individuals so that resource allocation benefits all groups.

It gives focus to issues that are frequently overlooked in traditional budget analysis and decision-making, according to Rhonda Sharp, Emeritus Professor at the University of South Australia and Founding Member of the International Association for Feminist Economics, who contributed to the Committee’s inquiry.

‘Gender responsive budgeting plays an important role in bringing visibility to unpaid care work,’ she said.

Research by Oxfam indicates that the global value of unpaid care and domestic work for women aged 15 and over amounts to about $10.8 trillion annually, which is three times the size of the tech industry.

‘Considering women’s time doing unpaid domestic and care work in economic indicators contributes to policies that not only have positive impacts on gender equality but the economy as well,’ Sharp said.

Policies targeted towards increasing the affordability of childcare, for example, can improve women’s labour force participation, increasing household incomes and recoverable tax revenue.

Shadow Minister for Finance and Economic Reform and Regulation, Jess Wilson, noted that a framework to ensure the government is considering the needs of all Victorians in policy development and resource allocation leads to good governance.

‘The Budget is the central plank of government. It’s how we fund services, collect revenue and it’s how a government essentially operates,’ she said.

‘Having gender equality as a key consideration in budgetary decision-making processes ensures that the government is delivering outcomes for all Victorians.’ 

Under the amended Financial Management Act, a statement on the gender impacts of the state budget needs to be made each financial year. Gender impact assessments evaluate the effects that a policy, program or service may have on persons of different genders and how they can be developed and varied to address gender inequality.

The amendment also requires the government to take an intersectional approach to gender impact assessment by considering the compounding effect of other factors such as Aboriginality, race, age, disability, religion, gender identity, ethnicity and sexuality on gender inequality.

As the bill was passed following the 2024-25 Victorian Budget, the impact of the legislative change will be seen in the next financial year.

The recommendation made by the Committee to legislate gender responsive budgeting throughout the budget cycle was based on evidence provided by various stakeholders. This included the Multicultural Centre for Women’s Health and Rhonda Sharp who noted that high level political commitment for gender responsive budgeting demonstrated through legislative mechanisms is necessary to embed effective policies and practices.

The Committee also considered international evidence from countries that have a strong regulatory and legislative framework to support this view. The Philippine Commission of Women told the Committee that codification of gender responsive budgeting into legislation and the incorporation of gender-oriented goals into their budget has helped instil political commitment towards advancing gender equality outcomes in the Philippines.

Committee member Pauline Richards said the ‘structural change ensures gender responsive budgeting remains a key priority and helps provide continuality and accountability in gender responsive budgeting practices and gender equality commitments.’

‘Having gender responsive budgeting embedded into the machinery of government, as in the Philippines, ensures that gender responsive budgeting is business as usual and is widely accepted and no longer debated,’ she said.  

While considered a good first step, Sharp and Wilson both pointed out that gender impact assessment insights must be put into practice through policy changes that aim to close economic and social gender gaps.

As of May 2024, the gender pay gap is 10.4 per cent in Victoria. This is due to a variety of social and economic factors, one being that women overwhelmingly make up the childcare, nursing and education workforces that are lower paying. Women account for seven in every 10 workers in the education sector, and eight in every 10 workers in the healthcare system.

The 2024-25 Victorian Budget provides examples of the role the state budget can play in addressing gender inequalities.

It includes $109 million to help support paramedics and nurses, the majority of whom are women, and $18 million to support the teaching workforce. The government is also investing in the wellbeing of the education workforce, with $64 million to support the mental health and wellbeing of school staff.

With the fastest growing group of homelessness people in Victoria being women aged over 65 and the housing crisis disproportionately impacting Indigenous women, $11.5 million has also been allocated to support the implementation of Victoria’s Aboriginal Housing and Homelessness Framework, Mana-na woorn-tyeen maar-takoort.

In its analysis of the 2024-25 State Budget, Gender Equity Victoria stressed that the budget has the power to either perpetuate or reduce gender inequalities in Victoria.

By legislating the requirement that the government address the differing needs, priorities and challenges faced by all Victorians and allocate resources accordingly, the state government has made an important commitment to achieve more gender equitable outcomes in Victoria.