AT the start of the month, Liberal MP Julia Banks found herself the object of public ridicule when she said could live on the $40 a day – or $545.80 a fortnight – that a single person with no dependants receives on the unemployment allowance, Newstart.
Even the head of the Business Council of Australia, Jennifer Westacott, said it was impossible to live on that amount, but when Scott Morrison unveiled the budget a few days later, Newstart was left as is. Former prime minister John Howard, who put a freeze on Newstart payments in the 1990s, also weighed into the debate, saying he believed the policy had “probably gone on too long”.
While the Greens say they are reviving their push for a $150-a-fortnight increase in the allowance, opposition leader Bill Shorten skirted around the subject in his budget reply speech, saying only that Labor would review the payment system.
As the Australian Council of Social Service points out, the Howard government’s freeze on Newstart payments mean they have fallen substantially, in proportional terms.
By comparison, the Fair Work Commission has set the national minimum wage for 38 hours at $694.9 a week or $1389.80 a fortnight. A recent University of NSW study found a basic life – rent, food, transport, clothing, health-care and power bills – cost $433 a week or $866 a fortnight.
And now, an annual Salvation Army survey of those using its services has found the average Newstart recipient is living on $17 a day once accommodation costs are taken care of. The survey does not paint a pretty picture, with 40 per cent of those surveyed experiencing “food insecurity”. Half moved house in the past year, with a quarter moving because of family violence. More than half say they are going backwards financially.
The Coalition government has traditionally viewed Newstart as a temporary payment to tide people over between supposedly short-term bouts of unemployment but official statistics show that more than 180,000 people are unemployed for more than a year, with more than half of these jobless for at least two years. If someone cannot work, our society is wealthy enough to ensure that no person should be left behind. If the government is looking to spend the billions it will not be losing in big business tax cuts, returning Newstart to something like its old relativity would be a good start.
Sign up for our newsletter to stay up to date.