This article was first delivered as a part of an address by PRF Head of Systems Change, Josephine Khalil at the Australian Environmental Grantmakers Network Conference in September 2025
At the Paul Ramsay Foundation, our charitable purpose is to stop cycles of disadvantage so children, families, and communities can thrive. Our new strategy means going further upstream—tackling the root causes that create generational scars, rather than just treating the symptoms.
A few years ago, we invested heavily in jobs for people furthest from the labour market. Quality jobs matter: they provide economic dignity, income, and social mobility. But even with some $140 million invested, jobs alone are not enough to break entrenched poverty; jobs remain an important driver of outcomes, but this does not go far enough into the root causes of inequality and opportunity in todays world. The economic system itself is producing inequality faster than we can repair it.
And we had this same realisation in what were our other focus areas then: education, justice and early childhood. And, I would argue, in the fight against climate change and biodiversity loss. We can’t just address symptoms. We must examine—and change—the economic system itself. When I say that, I do not mean dismantling capitalism and markets, but making markets work for people, not the other way around. To be clear this requires substantial change from where we are now, not tweaks at the edges.
That may sound ambitious—even impossible. But the economy is not a law of nature. It’s a set of choices. And choices can be remade.
Today I want to share three themes from our work at PRF and my own reflections:
1. The tyranny of averages.
2. A broken economic lens.
3. Why philanthropy must act now.
Theme 1: The Tyranny of Averages
On paper, Australia looks like an economic success story. Our average wealth per person is the second highest in the world, just behind Switzerland; we have enjoyed long stretches without recession and steady GDP growth.
But averages can deceive us. The top 1% hold more wealth than the bottom 50% combined. Most of that wealth is locked in housing—not innovation or enterprise. Somewhere along the way, our homes turned from places to live into investment products.
Thirty years ago, a median house in Australia cost about three times the median income. Today it’s eight times—and 13 or 14 times in our capital cities. For renters, the dream of home ownership is slipping further away.
At the same time, wages have crept upward only modestly, while the value of assets like housing and gold has soared. And yet, most of our commentary still obsesses over CPI—on the price of milk and petrol—while ignoring the single biggest cost to families: some where safe to sleep at night.
Opportunity is no longer shaped by education or effort, but by whether your parents own assets. That is not the Australian fair go.
Social mobility is stagnating. The Productivity Commission found that 42% of people in the bottom two income deciles stayed there 20 years later. Wealth is even stickier—half of those at the top or bottom stayed put for decades. Poverty is rising. And living standards, once assumed to improve generation on generation, are now going backwards.
Why does this matter here?
Inequality matters because when wealth is distributed so unevenly, it profoundly affects social mobility, cohesion, and long-term prosperity. If we don’t confront it, inequality will keep undermining civic trust and destabilising both our economies and our societies.
People most affected by inequality are also the same people most vulnerable to climate change. Rising heat, energy insecurity, food stress—those with the fewest assets bear the greatest risks and are least able to adapt, recover, or shield themselves from its impacts. Inequality and environmental breakdown are not separate problems. They are intertwined, reinforcing crises.
So yes, GDP is growing. But so are our emissions. On average, the economy is doing fine. But the planet—and many of its people—are not.
Theme 2: A Broken Economic Lens
How did we get here?
Partly because we’re using the wrong economic tools. Externalities—like pollution, biodiversity loss, inequality—are well understood, but rarely counted – they are almost entirely ignored in how we calculate GDP, growth, or productivity and absent in how we value everything.
Our economic models assume a “representative agent”—an average person. But there is no average person. That assumption erases inequality.
When climate shocks hit, it is low-income households—the ones least able to adapt—that carry the heaviest burden. These households are more likely be under insured; to be renters, who have no rights or access to capital to electrify their homes. They are more likely to live in concrete jungles with less tree canopy covers to weather the brutal summers.
And when reforms are proposed, vested interests crush them. The mining tax was a once-in-a-generation reform—killed before it even began. That’s the status quo defending itself.
Theme 3: Why Philanthropy Must Act Now
This is where philanthropy has a unique role.
We can go where governments are constrained and markets are captured.
We can fund new measures of success—beyond GDP, toward wellbeing, fairness, and ecological health.
We can back pre-distribution strategies—like community wealth building—that share prosperity at the source.
We can push for true-cost accounting, so social and environmental costs of business finally land on balance sheets.
And we can advocate for fairer taxation—so we stop taxing work more heavily than wealth.
In short, philanthropy can help redesign the plumbing of the economy—so it serves people and planet, rather than extracting from both.
So let me leave you with this.
The tyranny of averages tells us everything is fine. It isn’t.
Our broken economic lens says inequality is accidental. It’s not—it’s baked into the system.
Philanthropy has a choice: treat symptoms, or go upstream and transform the system itself.
The system we have is not inevitable. It is a choice. And choices can be remade.
