Poverty is crippling many Australians and is a problem that the Albanese Government needs to fix immediately, writes Peter Sutton.
ON SATURDAY 21 May, Prime Minister Anthony Albanese, addressing his supporters after victory, used these words:
“No one left behind because we should always look after the disadvantaged and the vulnerable. But also no one held back, because we should always support aspiration and opportunity. That is what my Government will do.”
We are all familiar with the economic challenges facing the nation, with rapidly rising prices, higher interest rates and supply issues. Our most vulnerable Australians on income support are disproportionately bearing this burden.
The most vulnerable among us are subsisting on JobSeeker, Youth Allowance or the pension. These are increased automatically every six months to adjust for inflation. It must be remembered this is to reflect the increased cost of living for the preceding period. They are already coming off a very low base.
The current maximum rate of the Age and Disability Support pensions is $987.60 per fortnight. The maximum JobSeeker amount is $642.70 per fortnight. An older Australian aged 60 and above, continuously receiving support for nine months, receives $691 per fortnight.
In accepting this situation, we are condemning our fellow Australians to poverty. The Prime Minister and a number of his ministers have publicly stated that JobSeeker will not be increased in their first budget.
I have personal lived experience of existing on Newstart, now JobSeeker.
For most of my life, I have engaged in paid employment, working in various roles including over 20 years in banking. I worked in lending roles and was a business banker.
I worked for a short time for a health insurer and then in retail. I worked for a large national chain and whilst there, I received two state-based awards and was a national finalist in two awards. At the time, the company employed over 12,000 people. I paid income taxes, volunteered for university and medical research studies, and donated regularly to charity. I am now living on the Disability Support Pension.
My life experience is not an isolated example.
In 2006, I was a pedestrian struck by a car whilst crossing at a properly and legally designated crossing. I did not lose consciousness and I can recall the incident in detail. Immediately after the accident, I was absent from work for a period of seven months.
I have since experienced chronic pain, limited mobility and experienced PTSD and anxiety. As I have grown older, my conditions have deteriorated.
The reason I relate to this is that about 40% of those on JobSeeker have an underlying medical condition from illness or injury. The largest cohort on JobSeeker is those over 50 years of age. Many of them are older people waiting for the age pension, which now has an eligibility age of 67. As I have highlighted, many have a medical condition but have been unable to access the Disability Support Pension.
Ageism and discrimination are illegal yet very difficult to prove. Ageism is very real, as is discrimination against those with chronic illness or injury. Employers have concerns about duty of care, workers compensation premiums, liability and absenteeism.
At my last employer, a senior manager told me directly: “If I had my way, I would terminate every employee over 50 and replace them with young, fit casuals.”
During my period on Newstart, I was living on a diet of eggs and soup. My hot water service broke down and I could not afford to replace it. I went for a couple of years without hot water. I almost lost my home, as my lenders were ready to take possession and sell it.
Many of us take things for granted, such as catching up with friends or family over a coffee or a drink. These simple pleasures are expensive. I was receiving invitations from friends and family and declining them. After a while, invitations stopped coming. This resulted in social isolation and depression.
Individuals on JobSeeker are forced to make choices between daily living costs, food or medication, rent or utilities. These are very real decisions.
In refusing to consider an increase, many argue that increasing JobSeeker would be a disincentive to employment. This is a very spurious argument for a couple of reasons. The current rate of JobSeeker is about 40% of the minimum wage. Should it be doubled, it would still be beneath that measure of about 80%. It is under the two most common measures of poverty being the Henderson line or the OECD definition of 50% of median income.
Another rationale for not increasing it is that recipients receive other payments, including Rent Assistance. The information is publicly available; Rent Assistance is paid at a maximum of 75% of rent. It is capped at a maximum level of about $145 per fortnight.
It is not paid to those who own their home, who are transient, sleeping in cars or couch surfing. It is not paid to those people with a mortgage.
There are very clear humanitarian, moral and ethical grounds to increase JobSeeker. There are also very good economic reasons.
Listening to Treasurer Jim Chalmers speak recently, he argued that increasing JobSeeker is not in line with being fiscally responsible. Yet the legislated tax cuts, backed by the then Opposition, will proceed.
Arguably, increasing JobSeeker and other income support payments is better than providing a tax cut to high-income earners. Let’s examine why.
It is likely that the tax savings will be saved, or spent on discretionary items. These include new vehicles, household items, electronic goods, computers, phones and so on. As we do not manufacture these items, they are imported. The money flows to overseas shareholders in Tokyo, Shanghai, New York, London and Berlin. The goods will enter the country on ships that we do not own.
By contrast, increasing income support payments would flow through to small businesses. Job seekers will eat better, buying fruit and vegetables, meat and poultry. Through the multiplier effect, businesses will gain more.
“The best form of welfare is a job.” Readers will all be familiar with that quote. Nobody disagrees. However, the current rate of JobSeeker is too low and provides an impediment. A job seeker who is malnourished or hungry will not perform well in an aptitude test.
We know that many employers and recruiters now use literacy, numeracy, problem-solving and other tests. Applications, tests and interviews are completed online requiring technology. On $642 per fortnight, this is expensive.
The Government has the opportunity to act in October. The promise made by PM Albanese of “No one left behind because we should always look after the disadvantaged” appears hollow.
Poverty is a political choice.
- Government fails to effectively handle unemployment
- JobSeeker recipients sacrificed in $507 billion stimulus spend
- Morrison Government taking $1.3 billion from the poor and unemployed
- After JobSeeker ends, we need a new unemployment system
- Is this another JobKeeper bungle?
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