Bill Shorten is supporting calls for an urgent review into Newstart and other welfare payment levels, claiming neither he nor any other politician could survive on under $40 a day.
The Labor leader has thrown his weight behind a plea from leading economist and senior partner at Deloitte Access Economics, Chris Richardson, who called for Newstart to be increased by $50 a week.
Richardson claims the unemployment payments are now “embarrassingly inadequate” and has called on Turnbull’s government to make the changes in next week’s budget.
Currently, the maximum fortnightly Newstart payment is $545.80 for a single person with no children – which equates to $38.98 a day. Meanwhile, Youth Allowance payments for single 16 to 24-year-old students with no kids, who are living away from home to work or study, are capped at $31.84 a day.
According to The Australian, when asked if he could survive on a similar amount of $40 a day, Shorten said: “No, I couldn’t”.
He now wants the government to focus more on the people “at the very bottom of our society” and recommends a root and branch review of the entire government payments system – something he says Labor is pushing for.
“We’d contemplate reviewing it because we’ve got to be honest, don’t we? Who on earth among the government or anyone in parliament could live on the Newstart Allowance?” He asked. “That’s why we’ve said we want to review it, and we think the government would be very sensible to join us in this approach.”
It came after Richardson warned Australians could be judged harshly if the welfare system isn’t fixed soon, in a lengthy piece for Deloitte Access Economics. He claims the Newstart payment hadn’t kept up with national living standards for more than a quarter of a century.
“If we had to nominate the single standout fairness failure in Australia in 2018, it is undoubtedly our embarrassingly inadequate unemployment benefits,” Richardson wrote.
“Newstart hasn’t kept up with national living standards for more than a quarter of a century, shrinking sharply as a share of average and minimum wages, and relative to the age pension. And it’s set to shrink even further, as it is indexed to prices rather than wages.
“We should add $50 a week to these payments, and immediately index them to wages. That would be $3bn well spent.
“As you know, we are huge fans of budget repair. And we remain so. But budgets aren’t just about debts and deficits: how well we tax is vital to our prosperity, while the quality of the spending we make is vital to fairness.”
According to The Australian, around a million Australians receive either Newstart or Youth Allowance. Pensioners meanwhile, aren’t faring much better with their own fortnightly allowance. The maximum basic rate for a single is $826.20, which equates to $59 a day, while couples can receive a maximum amount of $1,245.60 combined – that’s $44 a day each.