Welfare Payment Changes Take the Rap for Jobless Rise

A welfare agency is claiming changes to welfare payments were partly responsible for 55 per cent increase of Australians claiming the Newstart Allowance.

According to National Welfare Rights Network, new data from  Senate Estimates revealed a 55 per cent increase in Australians claiming the Newstart Allowance since 2007 and a blowout in the numbers of unemployed people relying on inadequate social security payments.

Maree O’Halloran, from the National Welfare Rights Network, said the challenge for government, business and the community sector was to find a way of meaningfully re-engaging the long-term unemployed with the labour market, and to provide a level of income support which enabled them to live with “some modest dignity”.

“Changes to welfare payments were partly responsible for the increase,” O’Halloran said.

“The Australian Council of Social Service and UNICEF are drawing attention to the plight of families and children who are living in poverty, so it’s appropriate to highlight the problems facing 111,300 single parents who are struggling to make do on a maximum rate of Newstart of $38 a day.

“In March 2013, there were 646,414 people were receiving the Newstart Allowance, up 228,621 from 2007 figures, when just 417,793 people were looking for work.

“The other disturbing news is that there has been significant increase in the numbers of people reliant on income support payments for five or more years. Recent changes to Parenting Payment Single have resulted in a 28 per cent increase in people who have been reliant on income support for five years or more.”

O’Halloran said mature aged job seekers were also faring poorly with data indicating a 28 per cent increase among people aged over 50 on Newstart Allowance since 2010.

“In December 2010, there was 139, 881 people aged over 50 on Newstart, and by March 2013 this had ballooned to 179,736,” she said.

“38 per cent of current Newstart Allowance recipients (235,451) are single parents and people with disabilities who have been moved onto lower rates of payment as a result of changes in 2006 and 2013.

“There has been a 68 per cent increase in the number job seekers on social security payments for three or more years since July 2007 years. Unfortunately, unemployment benefits are not always a short term payment to tide people over until they find their next job. This number has grown from 160,640 in July 2007 to 269,562 in March 2013.”

O’Halloran said governments needed to prioritise assistance for people doing it toughest.

“You cannot expect people to survive for a lengthy period of time on $35 a day and not experience financial stress,” she said.

“One in six of all Newstart Allowance recipients are principal carers. It is not only single people who have to survive on this inadequate benefit but many families as well.

“Prior to the last Federal Election there was general agreement across the Australian community that the rate of Newstart Allowance needed to be increased. Groups as diverse as the Business Council of Australia, the Australian Council of Trade Unions and the Australian Industry Group are calling for the rate of Newstart Allowance to be increased.

“In November 2012 the Senate Committee found that the rate of Newstart Allowance failed to provide an acceptable standard of living ‘for anything but the shortest period’. Given this finding, National Welfare Rights calls on the government not to axe the Income Support Bonus. We also call on the government to maintain the Schoolkids Bonus for families receiving Family Tax Benefit A at the maximum rate. Scrapping these payments will hurt those already living in poverty.

“The overall pool of unemployed has grown from 417,793 in March 2013 to 646,414 in March 2013, with the largest proportional growth being in the long term unemployed.

“People do not choose to live on $35 per day.”