Child poverty on the rise: 730,000 children in poverty

16 October 2016

The Australian Council of Social Service (ACOSS) today released a new report showing that 731,300 children or 17.4% of all children in Australia are living in poverty, an increase of 2 percentage points over the past 10 years (from 2004-2014).

The report finds that nearly three million people were living in poverty in Australia in 2014, or 13.3% of the general population.

“The overall picture from the last decade is one of persistent and entrenched poverty across the community with an increase in child poverty.  It is a national shame that after 25 years of economic growth, we have not done better at changing this trajectory and ensuring our most precious national resource, our children, are given the best possible start in life,” said ACOSS CEO Dr Cassandra Goldie.

“Those most at risk are children in lone parent families, who are more than three times likely to be living in poverty (40.6%) than those from couple families (12.5%). Since 2012, the poverty rate for children in lone parent families has gone up from 36.8 to 40.6%.

“The housing profile of people below poverty highlights the concentration of disadvantage in the rental market. The vast majority of people below the poverty line are in rental housing (59.7%), with most in private rental housing (44.2%). Only 15.5% of people living below the poverty line were home-owners.

“The report confirms that people who are unemployed are at greatest risk of poverty, with 63.2% living in poverty. Unsurprisingly, the majority of people below the poverty line relied on social security as their main source of income (57.3%), but a significant proportion received wages as their main income (32%). This indicates that having a job is no guarantee of keeping people above the breadline, especially if the job is low paying and insecure.

“Our report shows those doing it the toughest are overwhelmingly people living on the $38 a day Newstart payment, 55% of whom are in poverty. This is followed by families on Parenting Payment (51.5%), the majority of whom are lone parents with children.

“This report is a further wake up call to the Government to address the inadequacy of the lowest income support payments and bolster support to low income families through the family payments system. It is also a reminder that housing remains the biggest cost of living issue for households and must be addressed as a policy priority.

“Newstart and Youth Allowance are $110 and $158 a week below the poverty line respectively. Along with improvements to training and employment supports, an increase to these payments of at least $50 a week would go some way to alleviating poverty and improve people’s chances of finding paid work.

“The alarming increase in child poverty revealed by this report should also act as an urgent appeal to senators to reject further cuts to family payments, currently before the upper house. The cuts would strip another $60 a week from single parent families. The current proposal to withhold Newstart support for young people for up to four weeks should also be rejected. Both proposals would likely lead to increased poverty.

“At the start of Anti-Poverty Week, we call on all political leaders to put reducing poverty at the centre of the policy agenda. This must include assessing the poverty impact of all major policy changes,” Dr Goldie said.

The Poverty in Australia Report 2016 was produced in partnership with the Social Policy Research Centre at the University of NSW, with the support of the Australian Communities Foundation (Social Justice Fund), St Vincent de Paul Society, Mission Australia, and the Salvation Army.

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Snapshot of poverty in Australia – in 2014:

  • The poverty line (50% of median income) for a single adult was $426.30 a week. For a couple with 2 children, it was $895.22 a week.
  • 2,990,300 million people (13.3% of the population), were living below the poverty line, after taking account of their housing costs.
  • 731,300 children under the age of 15 (17.4% of all children) were living below the poverty line.
  • Child poverty in Australia increased by 2 percentage points over the decade 200304 to 2013-14.
  • 1% of people receiving social security payments were living below the poverty line, including 55% of those receiving Newstart Allowance, 51.5% receiving Parenting Payment, 36.2% of those receiving Disability Support Pension, 24.3% receiving Carer Payment, and 13.9% of those on the Age Pension.
  • 3% of people below the poverty line relied upon social security as their main income and 32.1% relied upon wages as their main income.
  • Between 2012 and 2014, poverty rates increased for: children in lone parent families (36.8 to 40.6%), those receiving Youth Allowance (50.6 to 51.8% and those receiving Parenting Payment (47.2 to 51.5%). They remained very high (61.4% to 59.9%) from 2007 to 2014 for unemployed households.
  • The vast majority of people below the poverty line were in rental housing in 2014 (59.7%), with most in private rental housing (44.2%). Only 15.5% of people living below the poverty line were home-owners.