Welfare Increases Still Too Low - ACOSS

Australia’s peak body for community services and the welfare sector has expressed concerns over the small rise to income support payments, such as Newstart and Parenting Payment, driven by the Consumer Price Index increase.

Social Services Minister Kevin Andrews recently announced that single age pensioners will receive an increase of $15.70 a fortnight, while age pensioner couples will receive $23.80 extra a fortnight on March 20.

“The Coalition Government is pleased to deliver increases to those on the Age Pension, Disability Support Pension, Carer Payment and veterans’ income support,” Andrews said.

“Another increase will occur in September and reflect growth in the Consumer Price Index or the Pensioner and Beneficiary Living Cost Index, whichever is higher.

“The rate is also benchmarked to Male Total Average Weekly Earnings to help the pension keep pace with community living standards.”

According to the Minister the increase is to help pensioners keep up with rises in cost of living expenses and are driven by the CPI increase of 1.9 per cent for the six months to December 2013. The increase will affect more than 3.6 million pensioners.

However Newstart and Parenting Payment increases are smaller with single recipients without children on the maximum rate of allowance to receive an extra $9.70 a fortnight. The maximum fortnightly rate will be $519.20.

Singles with children on the maximum rate of allowance will receive an extra $10.50 a fortnight. The maximum fortnightly rate will be $561.80.

Parenting Payment Single recipients will receive an extra $13.50 a fortnight. The maximum fortnightly rate will be $725.10.

Australian Council of Social Service CEO Cassandra Goldie said ACOSS fully supported the increase in pensions, however was concerned with the lower increases for Newstart and single parent payments.

“Our big concern is that single parent payments are not keeping up with the sensible increases in pensions,” Dr Goldie said.

The welfare increase announcement came as two reforms were flagged by the Social Services Minister to be considered under the Coalition Government’s welfare system review.

The plans are for a universal payment that will combine the disability support pension and Newstart and the removal of the rule that unemployed people can refuse a job that requires them to travel more than 90 minutes to a workplace.

According to a spokesperson for Minister Andrews, the issues are under consideration by the welfare review being carried out by Patrick McClure.

“The outcome of this review will be considered by the Minister when it is completed, sometime prior to the Budget,” she said  

Dr Goldie said ACOSS didn’t support a “blanket requirement” for unemployed people looking for work.

“If we are serious about getting people into jobs that they are willing to keep we can not put people into impossible work situations,” she said.

ACOSS has today called on the Federal Government to end uncertainty about the future of key community services.

In a supplementary submission to the Senate Select Committee Inquiry into the Federal Government's Commission of Audit, ACOSS has highlighted its concern that many services are now being caught up in budget speculation, with no certainty about where the government plans to make cuts in the May Budget.

"Services for people who are homeless, women and their children leaving violent situations, at risk young people disengaged from training and employment, and people in financial crisis are all up in the air,” Dr Goldie said.

"Funding for these programs is only secure until 30 June. Government departments have been unable to confirm the future of these services; those under the National Partnership Agreement on Homelessness, the Youth Connections program and funding for financial services are all affected.

“Other vital community programs have already been cut, or are clearly in the firing line, including funding for the Alcohol and other Drugs Council of Australia (ADCA), Aboriginal Legal Services, legal aid and community legal services, and community programs for people from diverse cultural backgrounds.  The recent open letter calling for funding to be restored to ADCA, signed by ten highly respected Australians, shows the level of growing community concern," Dr Goldie said.   

“The National Partnership Agreement on Homelessness (NPAH) supports adults and their children who are homeless. Whilst accurate figures aren't available, Mission Australia has estimated that about 180 services, 80 000 clients and over 3000 staff are covered under the NPAH.

"It would be extraordinary to pull the rug out from under these services when the Treasurer has promised that government funding will be targeted to those most in need.

“It would also be crushing for young people who can't get a job if their support programs were cut, when they should be expanded. The latest figures show youth unemployment is twice the general unemployment rate (12.2 per cent) and as high as 20 per cent among 15-24-year-olds in some parts of the country.

“Programs such as Youth Connections have helped many thousands of young people who had disengaged or were at risk of disengaging from education or employment. The program has achieved excellent results in an increasingly tough job market. Nationally, 67 organisations deliver Youth Connections over 113 service regions, assisting over 70,000 young people.

"Services are increasingly alarmed that the government may use the expiration of funding contracts on 30 June to deliver budget savings.  Whether this is intended or not is unknown. However, in the absence of new contracts being put in place, services are understandably concerned.

“We agree we have a budget challenge, and have supported a responsible audit of government expenditure.  However, we need to be looking for savings amongst the tax breaks, loopholes, rebates and payments which benefit people who already have significant income and assets: superannuation, discretionary trusts, private health rebates, the assets tests for the age pension, negative gearing and capital gains, as well as generous supplements and concessions to people already enjoying a well above average standard of living.  

"Services and payments to support vulnerable and low income people should not be in the firing line in search of a budget surplus.

"This was the previous government’s mistake, one that Labor’s leadership now regrets in Opposition. Over 100,000 single parents and their children suffered the consequences, and are still waiting over a year later, for something to be done. Let us not make the same mistake again. The funds needed for these vital services are modest, and will save us far more in the future,” Dr Goldie said.