ACT chief minister Andrew Barr has called for an increase to the Newstart allowance.
Speaking to the Legislative Assembly during Tuesday’s ACT budget speech, Barr claimed the current rate of Newstart allowance is simply too low.
“At just $273 a week – some $400 less than the national minimum wage – the current rate of Newstart is too low to help people get back on their feet when they end up out of work,” the Herald Sun reports Barr saying. “Instead, it simply traps them in disadvantage.”
During his speech, the chief minister made no mention of how increasing the amount of money welfare recipients receive would actually get them out of a vicious cycle of disadvantage.
According to The Guardian, there hasn’t been a significant increase in Newstart allowance for more than 25 years, with neither the Labor Party or Coalition promising to increase the amount during that time. For a single person without a dependent, Newstart recipients get less than $40 a day.
And while 36.1 per cent of all people receiving welfare payments are living below the poverty line, 55 per cent of those are receiving Newstart, according to the Australian Council of Social Service.
Barr’s comments appear to contradict recent comments made by the Labor party, including Opposition Leader Bill Shorten. Shorten said in his Budget reply that he wasn’t happy with the current level of Newstart allowance and criticised the government for failing to boost the allowance in its Budget but called for a review of the system rather than an increase in payments.
“One, we are not the Government and, two, we need to review the payment system to work out what is adequate,” Shorten told ABC’s 7:30. “But I certainly agree with a lot of the people who are saying it’s an issue. You probably didn’t notice in my speech I deliberately sent a message saying that job seekers living in poverty is an unacceptable set of circumstances.”
It’s not just job seekers living in poverty. Of the 36.1 per cent of people receiving welfare payments living below the poverty line, 13.9 per cent are on the age pension. The poverty line in Australia currently sits at $852.60 per fortnight for a single person.
The base age pension rate for a single adult per fortnight is $826.20, while it’s $622.80 for each person in a couple. That is an increase from 2016’s base rate of $794.80 a fortnight for a single person and $599.10 for each member of a couple.
While the amount has risen for pensioners, many are still living below the poverty line. That’s despite Treasurer Scott Morrison 2018-19 Budget announcement, where he announced that pensioners would be able to earn up to $300 a fortnight – $50 more than the current earnings cap on the Pension Work Bonus – without seeing their pension payments cut.
And the work bonus scheme will be extended for the first time to self-employed people, in the hope of encouraging older Australians to start their own businesses. That means a potential $1,300 annual income boost to pensioners who take full advantage of the work allowance.
Andrew Barr declined to comment to Starts at 60 for this article.