The cost to the economy from inequality is a bigger problem than mental illness, obesity or long-term unemployment, shadow assistant treasurer Andrew Leigh warns.
In a speech to be given to the University of Sydney on Friday, Dr Leigh highlights the fact that five million Australians have nearly two-thirds of the nation's wealth.
At the other end of the scale, he visited Ravenswood in northern Tasmania this week where the average household income is just $32,240 compared to the national average individual wage of $78,800 and the unemployment rate is 16 per cent when the national rate is 5.6 per cent.
Family violence rates are high, and children miss out on things other families take for granted, such as a car, school excursions, or social networks that provide a first job opening.
"It's not just in northern Tasmania that this a a challenge," he will say.
* One in eight can't afford dental care.
* One in five Australian families say that they can't afford an annual one week holiday.
* Underemployment is at a record high, and wage growth is at a record low.
"If you spend all your time in inner suburbia, it's easy to miss the extent of deep disadvantage, since Australian poverty rates tend to rise the further you go from the city centre," Dr Leigh says.
Lateral Economics estimates the cost of inequality to the nation's wellbeing is the equivalent of $54 billion, making it a bigger problem than mental illness, obesity or long-term unemployment.
But he argues policy can reduce poverty, as was the case when the pension was increased in 2009 and resulted in a million Australians being shifted out of poverty.
"Equality isn't a fashionable buzzword - it goes directly to our sense of national identity," he says.
"I fear that we think that equality is merely about battlers and billionaires sharing the showers at Bondi Beach."
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