But then COVID-19 hit and the jobs began drying up. Add to that a serious car accident at the end of March and Kabel was looking at being out of work for a while.

He was able to take advantage of the Federal Government's early access to superannuation initiative to pay his rent until his lease runs out in November. The JobSeeker coronavirus supplement, which welfare recipients receive in addition to their usual payment, also helped to just keep his family's heads above water.

"It was enough to help us limp through," he said.

But that's all changed with the fortnightly supplement reduced from $550 to $250 on Friday - wiping $600 from his and his wife's income every two weeks.

Mr Vafiopulous said this is the first time he has received financial assistance since he was a University of Newcastle student more than 20 years ago.

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The Central Coast family has deducted the maximum amount of superannuation allowed and loaded up credit cards in order to cover car loan repayments, bills and day to day expenses. They've cancelled Foxtel, pet and health insurance and cut down massively on food and driving.

"We have no more savings," Mr Vafiopulous said. "What's happened this week is really scary. I don't know what we're going to do.

"We started this quite okay. We used the redundancy money to pay off our credit cards.

"I feel really scared for people who weren't in our position at the start of this. I can't fathom how people have survived."

Mr Vafiopulous said the car accident had made it difficult for him to work both physically and mentally and he dismissed the notion that people on welfare didn't want jobs.

"They think we're all bums and don't want to work - it's not true," he said.

Before the accident, Mr Vafiopulous said he applied for more than 100 jobs, and was selected for some but businesses then said they could not put anyone on due to the nature of the pandemic.

He believed the government should have kept the supplement at $550 and was amazed that people lived on just $565 a fortnight prior to COVID-19.

"How the hell do people survive on that? It's keeping someone in poverty," he said.

"The government says it has to stimulate people to get out into the job market, but they're not basing it on reality."

Mr Vafiopulous said he was in the process of applying for the disability support pension, while his wife was looking for work.

But he fears for the future - particularly when the JobSeeker coronavirus supplement is cut completely at the end of the year.

"We're going to have to sell stuff - stuff we've worked bloody hard for," he said. "It's quite horrifying."

More than 9,400 people in Newcastle and another 10,715 people in Shortland were receiving the JobSeeker payment in June, according to data from the Department of Social Services.

The reduction equates to a more than $6 million loss across both electorates.

Australian Council of Social Service (ACOSS) CEO Cassandra Goldie said the changes would be felt most in regional areas.

"Across Australia there is one job available for every 12 people on JobSeeker," she said. "In regional Australia, it's one job for every 28 people.

"People will be living on just over $400 a week. We're going to see increased homelessness as many people will face eviction when they can't pay their rent and struggle to feed themselves.

"People say it's cheaper to live in the bush, but housing can still be really expensive in those areas.

Ms Goldie called on the government to introduce a "permanent, adequate" increase to the welfare payment in its upcoming October budget.

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