The gap between Australia's richest and poorest grew by 13 per cent over the past decade and is projected to jump by a further 10 per cent over the next 10 years, according to new research.
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The report, by the National Centre for Social and Economic Modelling, finds that households in the bottom 20 per cent of incomes saw their living standards - or disposable income - grow by about 15 per cent over the past decade, while the top 20 per cent enjoyed growth of 28 per cent.
"We find that living standards have increased in Australia over the past 10 years, however, that growth was not shared evenly," author Ben Phillips said.
The report, conducted for Anglicare Australia, finds that the "likely driver" of difference between the standard of living today and in 2024-25 is changes in the Abbott government's first two budgets. These include cuts to family payments and pensions.
Of "great concern" is families headed up by people on payments like Newstart or Youth Allowance. Their living standard only grew by 4 per cent over the past decade, compared to pension recipients and non-welfare recipients, who all gained about 20 per cent.
The research finds couples with children were the family group that most increased their standard of living, increasing by almost 40 per cent. This is largely due to strong wages growth and the increase in the number of dual income families.
The Living Standards Trends in Australia report also predicts that all Australians will have to get to used to less growth in the coming years.
While Australian households saw an increase in their standard of living by 1.9 per cent a year between 2004-05 and 2014-15, it is tipped to grow by just under 0.2 per cent per year over the coming decade. This is largely due to a projected drop in income growth.
Anglicare Australia executive director Kasy Chambers said: "As Leonard Cohen sings, 'Everybody knows the fight is fixed, the poor stay poor and the rich get rich'. That is true of the past 10 years of vigorous growth. What this report tells us, however, is that the poor will not just stay poor. They are on track to get poorer.
"Australia has reached a watershed. We can continue to walk away from many of the most vulnerable and the most disadvantaged among us, as this research shows we are doing.
"Or we can commit now to ensuring our economy and our society gives everyone a fair go."
