Charities and social advocates have reacted angrily to the federal government slashing the JobSeeker welfare payment, fearing it will dump untold thousands back into crushing poverty – and potentially homelessness.
Under changes announced by Prime Minister Scott Morrison on Tuesday, the coronavirus supplement to the unemployment allowance will be cut to less than half its current rate, from $550 a fortnight to $250, at the end of September.
Combined with the standard $565 fortnightly JobSeeker payment, the change will leave many recipients on $815 a fortnight – a significant upgrade on the pre-COVID sum, but still below the poverty line of $457 a week.
Homelessness Australia fears the cut “will result in a huge increase in homelessness”.
“While the extension of the supplement is welcome, the reduced rate is completely inadequate to pay rent in cities like Melbourne and Sydney,” chair Jenny Smith said.
“Of even greater concern is that at the end of the year, this rate will be further reduced, putting an unconscionable additional number of people into poverty.”
Ms Smith said median rents in the major cities could leave many people with as little as $28 a week for other expenses.
Anglicare Australia’s acting executive director Imogen Ebsworth said the changes would “plunge hundreds of thousands of these Australians – and their children – into poverty as the world heads into a deep recession”.
— Political Alert (@political_alert) July 21, 2020
There has been much pressure on the federal government to continue the successful programs.
That increased with the second phase of lockdowns in Melbourne, which will only lift in August – weeks before the twin payments were due to end.
Emma King, CEO of the Victorian Council of Social Service, slammed the JobSeeker cut.
“The federal government is ripping the rug from under job seekers. Australia is in recession. People are suffering. There aren’t enough jobs to go around,” she told The New Daily.
“For the first time in years, people on income support have been able to afford the basics. A $300 cut will mean people have less money to spend on food, energy, rent and their health needs.”
VCOSS pointed out that the new effective rate of JobSeeker was less than $60 a day – with which a person must pay for housing, food, bills, utilities, clothing and transport.
So it's true.
The Federal Government is cutting $300 per fortnight from those Australians who are out of work.
This is an outrage. pic.twitter.com/gRzhlSGTvb
— VCOSS 😷 (@VCOSS) July 21, 2020
Ms King warned the scheduled December end date for the COVID supplement would be “another funding cliff”.
Mr Morrison said further arrangements for the future of JobSeeker in 2021 were yet to be made, hinting the payment might not return to its pre-pandemic level of $40 a day, but would not elaborate on an ongoing amount.
“What we need is for JobSeeker set at a fair and generous rate, and locked in,” Ms King said.
The Australian Council of Social Service said current arrangements meant that JobSeeker recipients faced “the prospect of returning to $40 a day on New Year’s Day”.
“While we note that the Prime Minister said today the supplement may be extended beyond the end of the year, what we needed from the government today was an adequate, permanent fix to income support, not a temporary, lowered extension,” ACOSS chief executive Dr Cassandra Goldie said.
“The government’s decision is out of touch with the broad support across business, unions and the community for an adequate level of income support, set permanently – we need a guarantee we will never go back to $40 a day.”
Labor leader Anthony Albanese told Sky News that returning to the old JobSeeker rate was “completely unacceptable”.
Greens senator Sarah Hanson-Young called Mr Morrison a “Christmas Grinch” for scheduling further JobKeeper cuts during the festive season.
“The government’s announcement today is cruel, it’s mean-spirited, and it does nothing to support Australians getting back to work,” she said.
Today’s JobKeeper and JobSeeker annoucement leaves a million Australians worse off. It cuts wages for low income workers, punishes casual workers & pushes families into poverty.The decision to cut JobSeeker in December is particularly cruel. Scott Morrison is the Christmas Grinch of 2020.
Posted by Senator Sarah Hanson-Young on Monday, July 20, 2020
Kristin O’Connell, of the Australian Unemployed Workers Union, called the cut “absolutely devastating”.
“We know 1.7 million people will be straight back under the poverty line when the payment changes,” she told The New Daily.
“People had a little bit of hope, and felt like they were finally being treated as human beings, but this has crushed a lot of people.”
Mr Morrison and others in his government, as well as treasury department officials, have claimed the current rate of JobKeeper and JobSeeker was a disincentive for people to accept paid employment, but Ms O’Connell said it might be the exact opposite situation for many unemployed people.
“There are now basic items that people are able to afford for the first time in a long time. Things they needed to be equipped for work, like buying clothes, or eating well so they have the energy to look for jobs,” she said.
“Cutting the rate is a barrier to people finding employment.”
Anglicare called on Mr Morrison to permanently lock in a raise to JobSeeker.