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Overhaul could worsen poverty

The government’s planned overhaul of the welfare system could push the most vulnerable further into poverty and undermine their ability to get a job, the Australian Council of Social Service has warned, Radio Australia reports.

The bill introduces tougher punishments for jobseekers who fail to meet their mutual obligation requirements and ends the ability for welfare recipients to notify the department of an “intent to claim”, should they find themselves unable to lodge a claim for social security in full.

The government also plans to save $198m by effectively delaying the commencement date of certain Newstart and Youth Allowance payments.

Currently those welfare payments begin when the recipient first meets with an employment services provider but are backpaid to the date a claim for welfare is first made.

The government plans to end that backpay arrangement, saying doing so would encourage welfare recipients to meet employment services providers with more urgency and increase their prospects of finding work.

But the chief executive of Acoss, Cassandra Goldie, said that incentive already existed in the current system, because welfare recipients didn’t get their first payment, including the backpay, until they met with a service provider.

“We cannot understand why the government is doing this, other than to cut the incomes of people already doing it tough, and make budget savings at their expense,” Goldie told Guardian Australia. “People who are looking for paid work already have a huge incentive to connect quickly with their job service provider. They won’t get paid until they do.”

Acoss has also recently called for a $75 per week increase to Newstart.

But social services minister Dan Tehan said about two-thirds of people on Newstart exit income support within 12 months, and “99% receive additional payments and supplements.


Coalition warned welfare overhaul could worsen poverty and unemployment (The Guardian)


ACOSS Briefing Note