Major Australian organisations are calling for a “permanent and adequate increase to JobSeeker, Youth Allowance and related payments”.
The Australian Medical Association, Cancer Council Australia, the Australian Council of Trade Unions and People with Disability Australia are among the institutions that have signed a joint statement and supported today’s National Day of Action to raise levels of welfare payments.
The Raise The Rate For Good campaign says Australia “cannot turn back to the brutality of people without paid work struggling to survive on the old Newstart rate of $40 per day”.
“This is not enough to live, let alone to cover the basics, including housing, food (especially fresh food), transport, bills, medical and healthcare needs.”
Anglicare Australia executive director Kasy Chambers told Pro Bono News that before the Newstart coronavirus supplement doubled payments, 46 per cent of the charity’s clients “needed help getting basic essentials such as food or medicine”.
Ms Chambers said under the old rate, people were “forced to turn to charity just to get by”.
“Most people we surveyed reported missing meals at least once a week. They were juggling which medications they could afford to take and working out how they could afford their electricity bill.”
Leanne Wells, the CEO of the Consumers Health Forum, says: “The significant increase in the unemployment payment at the onset of the coronavirus was recognition of just how inadequate the old Newstart rate was.
“The argument for retaining a realistic rise in these payments is even stronger today when we face the prospect of deep economic recession and the mounting health challenges that will bring to low-income Australians.”
She called on all sides of politics to “act on the compelling evidence that people in poverty are much more likely to suffer poor health, higher risk of chronic disease and mental illness”.
Older Australians who lost their jobs as a result of the pandemic have been acknowledged as one of the key groups facing long-term hardship.
Professor John Piggott, from the University of NSW business school, said it was “common knowledge” that if you were thrown out of employment at the age of 55, you had a greatly reduced chance of finding another job than if you were younger. “The rate of long-term unemployment is much higher for people above the age of 55,” he said.
Foodbank Australia has reported a 78 per cent increase in people using its services since the beginning of the coronavirus pandemic.
The emergency coronavirus supplement payment lifted the JobSeeker rate to $1100 a fortnight but is due to end in late September. Charities believe they will be overwhelmed if the rate returns to $560 a fortnight for more than 1.7 million people currently on the unemployment benefit. The $1500-a-fortnight JobKeeper scheme, subsidising more than 3.3 million employees, is also due to cease at the end of September.
The government is expected to announce its plans for the schemes during the budget update on 23 July.
Grattan Institute household finances program director Brendan Coates told The Age that a return to previous payment rates would be “catastrophic”.
“It’s a recipe for a large number of defaults in the mortgage market and it’s a recipe for hardship and demand for charity going through the roof.
“There is currently only one job vacancy available for every 13 people on JobSeeker or Youth Allowance.”
Ms Wells says the government’s own publication, Australia’s health 2018 states that if the health gaps between the most and least disadvantaged closed, “half a million Australians could be spared chronic illness, $2.3 billion in annual hospital costs could be saved, and Pharmaceutical Benefits Scheme prescription numbers cut by 5.3 million”.
“For many people who used to be on the old, low rate of Newstart, the increase to JobSeeker has meant they’ve finally been able to access the essentials, like prescription glasses, paying electricity bills so they can turn their heating on and buy warm jumpers for their children to get through winter,” Ms Wells said.
“We agree with ACOSS that as we rebuild in the future, we cannot turn our back on those who are at risk of being left behind.
“And, of course, we know that people in private rental are by far the worst off because of the high cost of rent.”
Ms Chambers said she would like to see the JobSeeker payment remain at its current coronavirus supplement rate. And maintaining it would help the economy.
“Clients are telling us that since the new rate came in, they haven’t needed to eat two-minute noodles for dinner. They’ve not had to decide which medications they can afford to take,” she said.
“While we recognise that’s a huge budget amount, it is also the best stimulus that the country could dream up.
“That money will go straight back into the local supermarket, into the local pharmacist, and boost the economy.”
The Guardian’s Greg Jericho has labelled the base jobseeker payment “disgracefully low”.
“The harsh truth about the government’s decision to effectively double the jobseeker rate from a base of $565.70 a fortnight to $1115 for a single person, as soon as COVID-19 smashed employment, is that were the rate actually at a decent level such a special bonus would not have been needed.”
He also sees economic benefits for the nation in increased rates.
“Unemployment benefits need to do two things. First, they need to allow people to support themselves while looking for work. Second, they should act as automatic stabilisers during recessions – to keep money flowing across the economy.
“As it is, the jobseeker payment, even when including the extra $550, only just gets a person above the poverty line.”
He says the pre-COVID-19 level of jobseeker was nearly 40 per cent below the poverty line.
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