Newstart needs a sweetener, or at least a major review
The Julia Gillard surfing team, that wretched group that dines large on the taxpayer’s nipple, has it too good. This lot earns a whopping $300 a week (with rent assistance) enabling them to do all sorts of glamorous things like have caviar food fights in mumsie’s champagne cellar.
Or maybe not. After all, this is a world where rent can equal as much of 50 to 70% of that payment before they feed themselves.
Research by the National Welfare Rights Network found that if a person’s income was reduced to $243 a week (Newstart without rent assistance) “more than 60 per cent would stop buying fresh food and almost half would not visit a doctor when sick.” By contrast an aged pensioner with rent assistance earns $386 per week – 28% more than someone on Newstart.
Newstart is also a euphemistic term. It is not just for those that can’t get a job, but also for people that have been laid off or are without work because they are sick. Only employed people can access Sickness Allowance.
This means that Newstart is also dealing with those that can’t work. With pressure on getting people off the disability pension, the sick ones are serviced through Newstart. But people in this group can’t work and are left to fend for themselves at their most vulnerable.
This may be something that the National Disability Insurance Scheme captures in the future, but for now those that have fallen on tough times health-wise are not short term customers on Newstart. Unlike their able-bodied and minded contemporaries, there is no chance of work.
The stigma of “dole bludgers” fuels what seems a permanent race to the bottom for both major parties. Even the controversial Clean Energy Advances (carbon tax rebate) was only 64% of the pensioners’ advance for those on Newstart.
Yet because this group is on the bottom rung, their energy costs represent a much higher proportionate cost to income, so by basic economics, this group should have been paid more to compensate them for increased energy costs, not less.
The average median prices in Sydney have hit $450 per week for units and $495 per week for houses according to the Australian Property Monitors Rental Report. Even if the Newstarter lived in a share house that John Birmingham would have once written about, the odds are that it is a life of processed foods, homelessness, untreated failing health and a lack of education and opportunity that awaits them.
On Wednesday Jess Irvine called “codswallop” on the mid-year budget after Deloitte Access Economics and Macroeconomics delivered its verdict. Everything is pointing to David Copperfield being enlisted for a sleight of hand to hide the reality of a budget deficit in practical terms, if not in substance.
The economic gurus can debate over a 1998 Magill Estate Shiraz whether a billion or two in the black or red means much for credit ratings and interest rates. For those social pariahs on the dole, a little extra leg up means a hell of a lot to them. They are forced to go backwards, move state or end up doing cashies just to pay the rent.
Some may claim that Newstart has been indexed to Consumer Price Index year on year. Except of course that a “basket” of goods used to determine CPI includes such things as appliances and recreation that push CPI down and which are out of the reach of the nation’s poorest.
So while CPI for June 2012 was around 3.1%, vegetables and rice were up 5.2% (67% more than CPI) and food up 3.8% (22% more than CPI). But there is some good news. In a Marie Antoinettte moment, according to the ABS “This rise was partially offset by falls in cakes and biscuits (-2.8)”. So let them eat cake.
This is a complex problem. If the going is too good, there will be some that find it comfy enough to not look for work, so the push factor is relevant. Then there is the punishing reality that keeping a mobile phone connected, so the job seeker can be contacted, or fuel in the car to get to a job interview, are luxuries that are unaffordable.
The Senate Education, Employment and Workplace Relations Reference Committee are currently holding an Inquiry into the Adequacy of the Allowance System for Job Seekers and Others. NWRA have sought a modest $50 per week increase to those on Newstart.
They have also sought to link these allowances with the Pensioner and Beneficiary Cost of Living Index, as this index more capably deals with the costs facing those on the lowest income, rather than the simple metric of CPI. This may help pay for a doctor, some veges and even a train fare.
In a country where middle class welfare pads the pockets of voters, there is a group that year on year for over 20 years has been going backwards. What government largesse the community would accept to be forgone for those hanging on by their fingernails is an interesting question.
Or should those bloody bludgers just get a haircut, put down their surfboards and bongs and get a job?
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