ACOSS launches campaign to increase Youth Allowance and Newstart

By Ben Wilson

A week ago, the Australian Council of Social Service (ACOSS) launched a campaign to raise the Youth Allowance and called for an increase in Newstart. It’s called Raise the Rate.

This comes after comments by Minister for Social Services Dan Tehan, Minister for Jobs and Innovation Michaelia Cash, and Minister for Human Services Michael Keenan, about changes to Australia’s welfare system brought in by the passing of the Welfare Reform Bill on 16 March.

ACOSS chief executive Dr Cassandra Goldie said Newstart had not increased “in real terms since 1994.”

“At just $278 per week, people trying to survive on Newstart while looking for work are having to make really tough choices between paying a bill and eating a meal,” she said.

According the official government line, the change will be “simpler and provide greater encouragement for people to move from welfare into work.” The truth of the matter is that this is about making it harder to get on benefits and stay on them, while at the same time denying services that will help people find real work.

The idea is that desperate people will do anything to survive. Even take on work that is unsuitable to their needs, demeaning and dangerous, at a fraction of the normal wage and no protection. And this is to be achieved by not only making welfare harder to obtain. But by keeping benefits so low that they are not enough to cover even basic needs.

Australia’s job market is depressed and there are more people looking for work than there are available jobs. It only makes sense, if the purpose is to use the unemployed to replace those already in secure work. And this can only be achieved, if the pay and conditions are cut down.

Government policy is therefore a means to create a more effective source of cheap labour, to further undermine the pay and conditions of the whole workforce.

In this context, the ACOSS campaign is timely. Forcing the government into making substantial increases to the Youth Allowance and Newstart will not only protect those on these benefits. It will defend the position of the whole workforce.

Source ACOSS

The graph shows that pensioners and Newstart recipients have far less income than the minimum wage. Those on Youth Allowance have even less. If Australia wants to eliminate the growing poverty problem and maintain living standards across the board, the inequality needs to be brought to an end. To make a significant impact, the rate must be raised to at least the minimum wage. This would mean more than doubling Newstart.

It can be done and the government’s argument that Australia cannot afford this does not hold water.

The following graph from the parliament of Australia’s own briefings show that Youth Allowance and Newstart make up a very small part of total welfare expenditure. An increase of the minimum required amount would not make a significant impact, and is far less than the cost of the tax avoidance industry, and just 0.7 percent of Gross Domestic Product (GDP). The benefits are an even smaller part of total government expenditures. It is just a matter of priorities.