Govt must heed call from yet another report to raise Newstart

The Australian Council of Social Service today called on the federal Government to listen to the findings of yet another Senate Inquiry report and move to increase the Newstart Allowance as a matter of urgency.

“We commend the Senate Education, Employment and Workplace Relations Legislation Committee for going even further than previous inquiries by not only accepting that the Newstart Allowance is too low but recommending it be increased,” said ACOSS CEO Dr Cassandra Goldie.

“The evidence is now insurmountable, stemming from volumes of reports including three separate parliamentary inquiries. The Government cannot continue to ignore this evidence coming from its own Committees.

“ACOSS welcomed some of the positive steps taken in the recent Budget, such as increasing the income free area to allow people on the $35 a day Newstart payment to keep more of the money that they earn. However we argued that this is simply not enough because it does nothing for the four out of five people on Newstart who cannot get into paid work and have no other earnings.

“We also welcomed other measures such as extending eligibility for the Pensioner Education Supplement to all single principal carer parents and allowing this same group to hold onto their Pensioner Concession Card, however we don’t think these can undo the damage caused by the move to drop single parents to Newstart in January. Most of the 80,000 single parents lost between $60-100 per week.

“We are pleased that the Committee has agreed with our view that these reforms do not go far enough and do not address the inadequacy of Newstart and other allowances. The Committee recommends that the government urgently respond to the recommendations and findings of the previous Inquiry into the adequacy of allowances in late 2012, which acknowledged that the payments are too low. But significantly, this new report calls on the Government to increase the base rate of Newstart Allowance and to index the payment appropriately.

“The effect of freezing the Newstart payment in time (not increased in real terms since 1994) has been devastating for people on it who have seen their payment fall further behind community living standards and has plunged them deeper into poverty. With one in eight people living in poverty in Australia, including one in six children, it’s time we addressed this issue.

“The move to drop single parents to this low payment in January has made the situation worse, as reported in a recent Salvation Army report (‘Doing It Tough’), which revealed a 12% rise in the number of people seeking help who are now receiving Newstart. The report found that a disturbing 7% of single parents who presented for Emergency Relief were homeless and a further 7% are living with friends or relatives. Most reported cutting back on basic necessities and go without meals and vital medical prescriptions.

“Only last week we saw more alarming evidence in the latest HILDA survey (Household, Income and Labour Dynamics in Australia Survey), which revealed that 24% of children living with a single parent are subjected to poverty, compared with just 7.6% of children in two-parent homes. It showed that the rate of lone parent child poverty has jumped a staggering 15% since 2001, which is clearly linked to the ongoing welfare to work measures of successive federal governments.

“If we are to reverse this disturbing trend we will need a renewed commitment from all sides of politics to address growing poverty in Australia. We simply cannot achieve this without finally addressing the inadequacy of the allowance payments which are too low for anyone to survive on, let alone to look for paid work. It’s time the Government listened to this irrefutable and overwhelming mountain of evidence, including from its own government Committees, and immediately move to increase the single rate of Allowance payments by $50 a week,” Dr Goldie said.

Media Contact: Fernando de Freitas 0419 626 155

Click here to view The Senate Education, Employment and Workplace Relations Legislation Committee report on the Social Security Amendment (Supporting More Australians into Work) Bill 2013

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