The last 18 months of the COVID Pandemic have brought dramatic changes in aspects of everyone’s lives. However, it is clear that some people have been much harder hit than others. If we are to understand what people need to stay safe and to recover over time, we need to understand what has happened to them, and who has been affected worst and where they live.
This short report and the accompanying interactive maps are the first of the ACOSS and UNSW Sydney Poverty and Inequality partnership’s COVID-19 Building Back Fairer Series. The purpose of the Building Back Fairer Series is to help us understand the different aspects of change, and who is most badly affected by the pandemic. The series draws together data on the impacts of the COVID recession on income support, employment, inequality, wealth and regions.
This Report No 1, COVID income support, looks specifically at changes in the number of people relying on income support payments in different regions between September 2019 and September 2021, pre-pandemic to the present time. It analyses the series of interactive maps which compare relevant data for different federal electorates across the country.
We trust this report will assist decision-makers to design policy responses to build back fairer as quickly and as safely as we can. We hope that the report and the accompanying maps are also valuable resources for all who are working hard to support people in their communities through the pandemic.
The Poverty and Inequality Partnership is one that includes researchers from disciplines across UNSW in order to fully explore the ways in which inequality and poverty are related to other measures of disadvantage, such as health, housing and homelessness and justice.
We extend our sincere gratitude to the ACOSS members and philanthropists who continue to support this vital research partnership, including Anglicare Australia; Australian Red Cross; the Australian Communities Foundation Impact Fund (and two subfunds – Hart Line and Raettvisa); the BB and A Miller Foundation; the Brotherhood of St Laurence; cohealth, a Victorian community health service; the David Morawetz Social Justice Fund; Good Shepherd Australia New Zealand; Mission Australia; the St Vincent de Paul Society; the Salvation Army; and The Smith Family.
Cassandra Goldie & Carla Treloar
This report analyses a range of interactive maps (above) prepared to provide the first geographic snapshot of people on income support payments[i] who also received COVID-specific income support payments across the country in the first wave of the pandemic in 2020, the Alpha wave. The maps also show those on the lowest income support payments during this year’s 2021 Delta wave, many of whom have not received any additional COVID income supports, in contrast to 2020.
The maps compare the number of people receiving those income support payments that were eligible for receipt of the Coronavirus supplement[ii] – the lowest income support payments including JobSeeker Payment, Youth Allowance and Parenting Payment – in federal electorates across the country over a two-year period:
* From September 2019 (pre-pandemic) to October 2020 (just after the first round of lockdowns), during which effective unemployment rose from 5% to 9%; and
* From September 2019 (pre-pandemic) to September 2021 (when half the country is again locked down and effective unemployment is around 8%).[iii]
In 2020, robust additional COVID income supports enabled many people out of paid work to cover the basics while they searched for employment or waited for their existing jobs to be restored. In the 2021 lockdowns, most people on the lowest income support payments have been denied extra support, leaving them to rely on payments such as the manifestly inadequate $45 a day JobSeeker Payment.
The government announced on 29 September 2021 that COVID Disaster Payments will end when we reach its overall 80% vaccination target, regardless of COVID restrictions and unemployment levels in different parts of the country, or whether people most at risk have secured safe vaccination rates.
These decisions mean those most deeply impacted by the 2021 Delta wave face a highly uncertain road to financial recovery. They leave the income and social divides shown in the maps in our report to fester across areas of our country, many of which were already the electorates with lower incomes and least resources, pre-pandemic.
[i] Income support payment numbers come from the Department of Social Services
[ii] Income support payment eligible for Coronavirus Supplement – the lowest income support payments – were: JobSeeker Payment (previously Newstart Allowance), Youth Allowance, Abstudy, Austudy, Parenting Payment, Special Benefit and Widow Allowance.
[iii] ‘Effective unemployment’ is the measure used by Treasury last year to measure the impact of COVID19 restrictions on employment opportunities. It includes people who were unemployed, stood down and those who left the paid labour market.
* From September 2019 (pre-pandemic) to October 2020 (during the peak of the 2020 Alpha wave), the number of people receiving the lowest income support payments like JobSeeker – those payments that were eligible for receipt of the Coronavirus supplement in 2020 – increased by 70% (from 1,307,601 to 2,221,000).
* By September 2021, there were 1,661,000 people on those payments – an overall increase since September 2019 of 27%.
* The areas (federal electorates) in which the number of people receiving these payments increased the most during 2020 were those already facing financial disadvantage, pre-pandemic.
* They are concentrated in outer north-west and south-east Melbourne, west and south-west Sydney, from Brisbane to the NSW border, and north Adelaide.
* These same communities still have elevated numbers of people receiving the lowest income support payments, harder hit by the pandemic and for longer.
* Areas with higher incomes, the most advantaged pre-pandemic, had significantly lower absolute increases in the number of people needing to rely on income support, showing they were less economically affected, and have bounced back faster.
* While people receiving these key income support payments were eligible for the Coronavirus supplement in 2020, over 80% – three quarters of a million people – have been ineligible in 2021 for COVID Disaster Payments, despite living in lockdown areas.
From September 2019 (pre-pandemic) to October 2020, the number of people on the lowest income support payments rose by 913,000 people or 70%, to 2,221,000 people.
The largest overall increases in people relying on the lowest income support payments over this period were in socially and economically disadvantaged areas. [i]
The top 20% of federal electorates (30 in all) with the largest increases in people on the lowest income support payments (who all received Coronavirus Supplement) were mainly in (Table 1):
* West and South-west Sydney (Blaxland, Watson, Werriwa, Fowler and Macarthur), with increases from 8,000 to 11,000 people per electorate;
* Outer north-west Melbourne (Calwell, Lalor, Gorton, and Macnamara), with increases from 8,000 to 13,000 people;
* South-east Melbourne (Holt and Bruce) with increases from 10,000 to 12,000 people;
* Regions between Brisbane and the NSW border (Rankin, Forde, Moncrieff, Fadden and McPherson), with increases from 8,000 to 11,000 people;
* Far north Queensland (Leichhardt) with an increase of around 10,000 people;
* Northern Adelaide (Spence), with an increase of around 8,000 people.
Areas which pre-pandemic were already more financially disadvantaged, with higher risks of unemployment, suffered harsher economic hits from COVID further exacerbating their financial disadvantage. This highlights the enduring impact of this pandemic on employment and incomes, including in tourist regions affected by border closures.
[i] Of the 30 worst affected seats, 21 were in the most disadvantaged half of areas in Australia ranked according to the ABS Index of Relative Socio-economic Advantage and Disadvantage (IRSAD) to classify regions as advantaged or disadvantaged. Victoria, much of which was still locked down at that stage, was disproportionately impacted at this time.
In the Delta wave of the pandemic (from July to September 2021 and ongoing), three States and Territories have endured extended lockdowns – New South Wales, Victoria and the Australian Capital Territory. [i]
By September 2021, the overall numbers of people on the lowest payments is lower than October 2020 at the peak of the first wave, but still well above pre-pandemic levels (in September 2019). As at September 2019, the total number was 913,000 people. By September 2021, the number increased by 27%, to 1,661,000 people in all.
Most of the same areas by electorate that saw the sharpest increases in reliance on income support last year (24) are still among the 30 worst affected (Table 2). In the absence of a robust income support buffer, people living in these areas are more financially exposed as COVID restrictions continue.
The top 30 (top 20%) of electorates with the largest increases from September 2019 to September 2021 now include:
* West and south-west Sydney, (Blaxland, Watson, Werriwa, Fowler and Macarthur, now joined by Lindsay, Barton, Greenway and Reid in western Sydney), with increases from 3,000 to 7,000 per electorate;
* The same seats in outer north-west Melbourne (Calwell, Lalor, Gorton, and Macnamara), with increases ranging from 3,000 to 6,000 people;
* The same seats in south-east Melbourne (Holt and Bruce) with increases from 3,000 to 5,000 people;
* The same regions between Brisbane and the NSW border (Rankin, Forde, Moncrieff, and Fadden), with increases from 3,000 to 4,000 people; and in addition,
* Lingiari in central Australia (Northern Territory) with around 4,000;
* Paterson in the mid-north coast of New South Wales with around 3,000;
* Brisbane (inner city) with around 3,000.
The three largest States are still over-represented with 14 in New South Wales, ten in Victoria, and six in Queensland.
[i] Shorter lockdowns were imposed in Queensland, Western Australia and South Australia. In addition, border restrictions impact employment in industries such as tourism.
The largest percentage increases in people relying on the lowest income support payments in the first wave of the pandemic were in comparatively affluent areas. This is because they had a lower number of people on income support in the first place. The absolute increases in these electorates were lower than national average, indicating they were less affected by job losses and financial disadvantage. The increase of 4,900 people in these comparatively affluent areas (from 3,100 to 8,000) was significantly less than the overall average national increase of 6,049 people (from 8,700 to 14,700).
Table 3 shows that in the first wave (to October 2020), the following areas had increases in income support from September 2019 to October 2020 in excess of 100% (compared with the average increase of 70%):
* Wentworth, Warringah, Mackellar, North Sydney, Bradfield, and Cook in northern and eastern Sydney.
* Reid and Mitchell in western Sydney.
* Macnamara, Menzies, and Goldstein in eastern and south Melbourne.
* Aside from Reid, all were among the top 17 socially and economically advantaged electorates[i].
[i] Based on the ABS IRSAD scale.
In the Delta wave (to September 2021), these areas, though not the people on the lowest incomes within them, bounced back relatively quickly:
* The percentage increases in reliance on income support in these areas between September 2019 and September 2021 were half as great (ranging from 28% and 86%) as in the first wave from September 2019 to October 2020 (ranging from 103% and 205%).
In 2020, we showed we could respond to adversity with cooperation, by providing economic security to all. During the 2020 Alpha wave, average incomes rose despite the deepest recession in almost a century. This was due to robust COVID income supports, especially the $750pw Jobkeeper Payment and $275pw Coronavirus Supplement which together reached 44% of the labour force.[i]
Thanks to the supplement, the number of people in poverty fell from 3 million (11.5%) before the pandemic to 2.6 million (9.9%) in June 2020.[ii]
Unfortunately, in 2021 COVID income supports are much weaker. Both Jobkeeper and Coronavirus Supplement were abolished in April 2021, and JobSeeker Payment was increased by just $25pw, not nearly enough to lift people out of poverty. The government had to quickly assemble a new income support package when the Delta virus struck. The new COVID Disaster Payment is the same level as Jobkeeper ($750pw) for people who lost more than 20 paid hours of work a week or $200pw for people on income support payments who lost at least eight paid hours a week.
Unlike the 2020 additional COVID income support payments, the Disaster Payments have been restricted to people who lost paid work in a current lockdown and ends as soon as the lockdown does.[iii]
In September 2021 there were 927,000 people in the locked-down States and Territories on the lowest income support payments.
Of these just 162,000 people (17%) received the COVID Disaster Payment.
The COVID Disaster Payments will be removed two weeks after vaccination rates reach an 80% target, whether or not the effective unemployment rate has fallen by then and those most affected by COVID restrictions have returned to paid work.
People will be left to rely on manifestly inadequate income support payments such as the $45 a day JobSeeker Payment.
[i] ABS (2021), Australian National Accounts; ACOSS (2021), Tough times, less support.
[ii] Gray M et al (2020), COVID-19, JobKeeper and JobSeeker impacts on poverty and housing stress under current and alternative economic and policy scenarios. ANU Centre for Social research and Methods.
[iii] COVID Disaster payments are available only to people who live in a location that is subject to restricted movements and that have been determined to be a hotspot by the Commonwealth Chief Medical Officer.
The decisions to exclude people on the lowest income support payments from the COVID Disaster Payment, and to prematurely end that payment, lock them into poverty. It deprives the worst affected communities of the spending power they need to recover.
At the same time, many who are still employed have seen their income and wealth increase or boosted their savings.[i]
The pandemic exposed the inadequacy of the lowest income support payments, prompting the government to supplement them last year and increase them by $25pw – still well below poverty levels – early this year. Those payments should be substantially and permanently increased if we are to ensure so that communities worst affected by COVID19 can recover and people affected by future restrictions can avoid poverty.
[i] ABS (2021), Australian National Accounts, Finance and wealth, at: https://www.abs.gov.au/statistics/economy/national-accounts/australian-national-accounts-finance-and-wealth/jun-2021?s=03