Pressure is mounting on the Coalition government to raise the Newstart rate following unanimous lower house crossbench support for a $75 increase.
On Friday, Queensland MP Bob Katter became the final House of Representatives crossbencher to throw his weight behind the Australian Council of Social Services-led campaign to raise the Newstart rate by $75 a week.
The basic Newstart rate – currently about $275 a week for a single person – has not been increased in real terms for 24 years.
“When Adam Bandt, Cathy McGowan, Kerryn Phelps, Andrew Wilkie, Rebekha Sharkie, and Bob Katter all agree, it’s time to stop talking and act,” ACOSS chief executive Cassandra Goldie said.
The major parties’ failure to act on the issue showed “just how out of touch” they are, she said, citing polling that showed 68 per cent of the community supported an increase to the unemployment benefit.
A report conducted for ACOSS by Deloitte Access Economics found increasing the Newstart payment would have numerous economic benefits, particularly for regional communities, including increasing consumer spending, creating 12,000 new jobs and boosting government revenue by $1 billion.
The Coalition’s position remained unchanged despite the groundswell of support.
A spokesman for the Minister for Families and Social Services Paul Fletcher told The New Daily the government’s focus was on getting people “off welfare and into work”.
“Our social safety net strikes the balance between supporting people when they need help, and not creating a disincentive to work,” the spokesman said.
“The fact is, 99 per cent of Newstart recipients receive another welfare benefit.”
Labor Social Services spokeswoman Linda Burney told The New Daily the rate of Newstart was “too low”, but stopped short of supporting an immediate $75 rate rise.
“The rate of Newstart is too low – so low that it’s preventing people from getting jobs,” Ms Burney said.
A Labor government would issue a “comprehensive review” to “identify what parts of the system need to change and how to pay for it”, she said.
Newstart recipients living in poverty
The vast majority of people receiving Newstart payments live below the poverty line, according to ACOSS.
“It is very difficult to look for a job when you don’t know where your next meal is coming from or how to put food on the table for your kids,” Ms Goldie said.
A family of four relying on Newstart payments would be living 32 per cent below the poverty line, according to research by progressive think-tank The Australia Institute (TAI) found.
“Not increasing [the unemployment benefit] for 24 years has plunged people into poverty and that’s a real concern,” TAI senior economist Matt Grudnoff said.
Anglicare Australia executive director Kasy Chambers said a $75 Newstart rate rise would be a “good start”, and that it should happen immediately.
Most Newstart recipients would put the extra funds towards basic expenses such as food, power bills, medicine, and school excursions, Ms Chambers said.
“We’ve got good research on food security showing that people on Newstart regularly miss a main meal up to two days a week, and also choose to keep a child home from school on the last day of the pay cycle if they can’t afford food for their lunchbox,” she said.
“The people we work with don’t take up school excursions because they can’t afford the extra bit of money.”
Anglicare’s 2018 rental affordability snapshot released earlier this year showed that only three of 68,000 rental properties advertised across Australia would be affordable to a single person on Newstart.
The organisation’s 2018 jobs availability snapshot found there were four disadvantaged unemployed people for every entry level job available.
Ms Chambers criticised the “narrative in media and politics that demonises poverty and criminalises welfare benefits”.
“Simple maths shows that there aren’t the jobs to go around, the demonisation of people without work is a nonsense, and very unhelpful,” she said.