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While all Australian welfare allowances are meagre, it is alarming that "Newstart" is so drastically below the poverty line.

It has not been raised in real terms since 1994.

Australia ranks second-worst in the developed world for poverty rates among the unemployed and 52% of Newstart recipients live in poverty.

Newstart recipients have fallen dramatically behind the rest of the community. At $267 per week ($13,800 per year), the allowance is now over $160 per week ($8,000 per year) below the poverty line, less than 18% of the average wage and less than 41% of the minimum wage.

We know, from studies and from job-seekers themselves, that living off Newstart can affect physical and mental well-being in many ways:

  • access to fresh fruit and vegetables, to regular, nutritious meals;
  • capacity to afford dental care and some medications;
  • ability to heat/cool homes;
  • intense stress about expenses, bills and rent, which affects cognitive, emotional and physical functioning;
  • societal stigma and other negative attitudes towards Newstart recipients; and
  • isolation and loneliness from being unable to fully participate in community life and social support networks.

Even in a rich country, being poor has consequences. Whether it is the emotional harm of being disconnected from friends and family, and excluded from community life because one cannot afford to drive or catch public transport, or having to skip meals, or not always being able to afford the most nutritious food, or the fatigue and ill-health that comes from constant stress about one's limited finances.

Joel, who is on Newstart, captures many of the ways that living in poverty affects your physical and mental wellbeing:

I often have to skip breakfast and lunch every day in order to save money. I do not feel I eat enough fresh fruit and vegetables; I look for specials and Black and Gold products. Nutrition never enters into what I buy, how cheap it is the only thing I'm capable of buying. If my income was higher, I would be able to buy fresh fruit, vegetables, things other than frozen products; I would buy more food in general if I could afford it.

I think every day about my finances. I'm living from hand to mouth without any chance to save or prepare for the future.

Very rarely am I able to see my family and friends ... my family lives in a different state and I haven’t seen them in about two years due to being unable to afford the travel expenses, with no chance of being able to join in on family occasions or holidays. Leaving the house is hard, even bus transport affects my budget, so leaving my house as little as possible is necessary. Any kind of community activity, festivals or events, getting there, buying anything whilst there, is beyond my income, and means any bus ticket or drink or food I buy there effects my income and ability to pay for rent, groceries and bills.

I feel as if relationships are impossible until I’m able to support myself.

An  Australian Council of Social Service (ACOSS) survey of 600 Newstart recipients in 2015 reported:

  • 40% are unable to pay their bills on time or see a dentist;
  • 50% are unable to raise $2,000 in the event of an emergency;
  • 50% are turning off heating and cooling to save money;
  • 32% skipped meals in the previous year;
  • 25% are suffering from "housing crisis" — spending more than half their income on rent; and
  • 20% do not have enough money for essentials like housing, food and electricity.

Making matters worse, there are not enough jobs to go around – 17 job-seekers for every job, including the unemployed and the "hidden unemployed" – meaning unemployment is no longer a short burst of pain but a long period of deprivation. 70% of Newstart recipients are unemployed for more than 12 months.

The mix of recipients on Newstart is also changing. Growing numbers of sole parents now find themselves on Newstart, thanks to "reforms" by the Howard and Gillard governments. This means that sole parents now shift from the higher, but by no means generous, parenting payment single allowance to the measly Newstart allowance, when their youngest child turns eight — instead of 12, as was previously the case.

Natalie, a sole parent on Newstart, captures how hard it is to make ends meet on a payment that is not even adequate for those without kids:

My son has ADHD, anxiety and autism, and requires three different medications to function at an acceptable standard to attend a mainstream school. He also attends a Catholic school, which is prepared to accommodate his learning needs because the public system in our area simply doesn't have the support systems in place to meet his learning needs. Just school fees are $150 a fortnight.

So we have six regular prescriptions a month, at a cost of $40. By the time I pay for school fees, rent, electricity, phone and internet bills, I am left with $250 a fortnight to cover everything.  

To stay well with both diabetes and my son's ADHD/anxiety/autism we rely on a diet of fresh fruit and vegetables, meat, bread and dairy foods — basically we live on a diet of largely unprocessed, sugar free, artificial colouring and preservative free, gluten and lactose-free products, wherever possible. All the expensive foods. 

$250 doesn't really cover the fortnight's groceries. It means we eat a lot of apples and potatoes, mince, sausages and rice. We've done the '100 ways with mince' recipe book. It also means that I often end up unwell — either I eat cheaper processed foods and it affects my blood sugar levels, or I skip meals and my blood sugar is affected. And either way I end up spending more time in the doctor's office and a burden on the health system. I can't win.

25% of Newstart recipients have a diagnosed disability. This is because of significant attacks over the past several years on the ability to access the Disability Support Pension (DSP). Those pushed off the payment, or unable to receive it at all, are locked out of a hostile, unfavourable labour market and become perennially unemployed or underemployed.

In the past year, more than 31,000 people have been removed from the DSP. This is the largest annual drop in history. Since June 2014, the number of DSP recipients has dropped from 830,000 to 788,000 — a 5% fall.

Currently, around 15% of applications for DSP are approved. This represents a significant decline in successful applications. In June 2014, 39% of applications were successful. In July 2011, 54%.

All this only strengthens the case for an immediate, long overdue raise of at least $100 per week for Newstart recipients. Longer-term, Newstart, indeed all welfare payments, must be set above the poverty-line.

After all, even business groups like the Business Council of Australia and KPMG have called for a raise to Newstart, albeit a very inadequate one of around $50 per week. This is the position of most of the community sector — a good start, but nowhere near enough.

On 5 June 2017, Anti-Poverty Network SA launched an open letter to the Federal Government, highlighting some of the health impacts of our impoverishing, punishing welfare system and calling for drastic changes.

It was endorsed by many state and national organisations, including the Australian Public Health Association, the Australian Health Promotion Association, the Australian Unemployed Workers' Union, the National Council of Single Mothers and their Children and Uniting Communities.

It was also signed by over 100 individuals, including prominent advocates Professor Eva Cox and Dr John Falzon.

To sign the open letter, e-mail antipovertynetwork.sa@gmail.com.

Pas Forgione is the coordinator of Anti-Poverty Network SA. You can follow Pas on Twitter at @PasForg

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