Australia cannot afford to lift welfare payment rates but other forms of support can be reformed to help the long-term unemployed, the employment minister says.

Tony Burke said the high levels of debt facing the nation after the pandemic make it difficult to change the Jobseeker payment, currently $46 a day.

The payments will be discussed at the federal government’s upcoming jobs and skills summit, with a peak welfare group calling for the rate to be lifted to $70 a day.

This would help lift people out of poverty while they search for employment, the Australian Council of Social Service says.

“We’ve still got 935,000 people who are trying to survive on unemployment payments … who are currently being overlooked by employers and locked out of paid work,” ACOSS acting chief Edwina McDonald said.

Mr Burke said with the unemployment rate at a historic low of 3.4 per cent, there was an opportunity to reform government services.

“Because there’s fewer people in the system … there should be an opportunity to wrap as many services around people as possible to be able to help them … so I’m still very mindful of what we can do,” he told ABC radio on Monday.

But the government may not be able to lift the Jobseeker rate as part of its first budget, Mr Burke says.

“There will be things that we would want to do, that people would like us to do, that aren’t going to be possible, he said.

“It’s a decision that gets made in the budget, but it’s hard.”

However, independent Senator David Pocock says the government should reconsider Jobseeker rates, rather than prioritising tax cuts for the wealthy.

“We have to be looking after people who need that support to actually be able to get back into the workforce. It doesn’t make sense to have Australians living in poverty,” he told ABC radio.

“We saw during COVID when the rate was raised, poverty came down across the country.

“There’s no reason why we can’t do that (now) particularly when we’re busy talking about giving wealthier Australians $243 billion worth of tax cuts over the next decade.”

ACOSS is also calling on the government to seize the “historic” opportunity of low unemployment to secure jobs and life wages.

Australia’s low unemployment rate is unlikely to remain unless the government acts, and a commitment to full employment must be at the heart of any reform, Ms McDonald said.

The council is proposing the government implement a jobs and training guarantee for people who experience long-term unemployment.

This would replace the work for the dole and employability skills training schemes which the council argues are ineffective and built to humiliate people.

A paper released by ACOSS ahead of the summit outlines subsidised employment, paid work trials and vocational training as alternatives to existing schemes to help people overcome barriers to employment.

– AAP