Small business calls for economic stimulus to include Newstart increase

9 March 2020

The Council of Small Business Organisations of Australia and the Australian Council of Social Service have joined forces to call for an increase to Newstart to be included in the Federal Government’s imminent economic stimulus package.

Council of Small Business Organisations of Australia CEO Peter Strong said: “While most people have been supporting an increase in Newstart for many years, the coronavirus creates a greater need to increase the rate. It is likely people will be laid off from businesses that cannot operate due to staff absences or closure of infrastructure or lack of goods or markets.

“While this will hopefully be short term, this means that employees without personal leave or annual leave will need to register for Newstart and will find the current rate too low. “An increase is essential. It is also for the self-employed who may find themselves needing to register for Newstart,” Mr Strong said.

Australian Council of Social Service CEO Casandra Goldie said: “The social need for an increase to Newstart has long been clear and widely agreed upon. “It also makes good economic sense, especially due to the downturn, exacerbated by the coronavirus and bushfires.

“A Newstart increase of $95 a week would deliver a $4 billion boost to the economy and generate thousands of jobs. Through a Newstart increase the stimulus would flow directly where it is needed most, including those regional communities grappling with high unemployment in the wake of the bushfires and drought. It would mean people in greatest need would immediately spend on the basics in local economies.

“The Australian Investment Council recently called for an increase in Newstart and Youth Allowance, citing social equality and economic stimulus. The Australian Investment Council joins a range of economists who believe raising Newstart would be effective economic stimulus, including the CBA Chief Economist, AMP Chief Economist, and Reserve Bank Governor.

“Increasing Newstart is not only the right thing to do, it’s also the smart thing to do.”