As the nation’s unemployment rate continues to climb, more than a million Australians are now receiving the JobSeeker payment and Coronavirus supplement, which is at least $1,100 a fortnight, when it used to be around $550.
For the first time in decades, JobSeeker is acting as the social safety net it was designed to be – helping people through tough times, rather than the Poverty Trap it had become.
Don’t just take my word for it, this is what we are hearing from the frontline:
“For the first time in six years, I was not at risk of homelessness, having to go without food or knowing how to pay utilities.” Simon*
“I’ve been able to pay rent, pay bills and have enough money for groceries. I haven’t had to decide which of my medication I can afford each month.” Liz
“Being able to clothe the children with the basic necessities and a bit more such as shoes for school.” Sophia*
This is just some of the feedback we've received from Western Australians who are now able to make ends meet.
Yet, there is clearly an underlying anxiety amongst recipients.
“I’m not naïve about September. Some people are worried about a second wave of outbreak. I’m worried about a second wave of financial problems.” *Lee
September is when the JobSeeker supplement – as well as the JobKeeper wage subsidy and suite of State and Federal relief initiatives such as the moratorium on rental evictions – are scheduled to end. They may wrap up sooner, as we’ve seen with the childcare sector.
While Australia may have so far successfully contained the health impact of COVID-19, there is mounting apprehension of an impending social crisis.
By the time we reach September, up to 1,700,000 Australians are expected to be receiving JobSeeker. As COVID-19 restrictions ease and life begins to return to a new ‘normal’, not everyone will get their old jobs back.
It was reassuring to read in The West Australian last week the Federal Government is considering increasing the JobSeeker base rate, which will be the first official increase for the jobless payment in more than 25 years.
While positive news, if payments drop below the current supplemented income, we will see a return to financial insecurity and hardship for those who are unable to find work in the post-COVID-19 economy.
The Parliamentary Budget Office estimates it would cost $7.7 billion annually for no Australian to live below the poverty line; defined as half the median income by the OECD, it works out as $500 per week for an individual.
While critics of such an investment may be concerned such a sum would be squandered or create more ‘dole bludgers’, the evidence would suggest otherwise; just take another look at the experiences I shared earlier.
Since the JobSeeker payment was doubled to $550 a week, by and large it has been spent on food, paying rent and bills, their children’s education and clothing, medication and doctor’s visits. Recipients are able to get a haircut and a work outfit so they’re job ready. They’re even starting to save for a rainy day.
Community housing organisations have told me residents are using the additional income to pay off the debt they’ve built up.
Not only are recipients spending the income responsibly, it’s being spent in their local communities, in local shops, businesses and institutions; schools, doctors, energy providers are receiving payment in full.
Permanently increasing JobSeeker isn’t only the right thing to do, it’s the smart thing to do as our economy recovers from this pandemic. Can you think of a better legacy of so many years of economic growth?
Author: Mark Glasson
First published in The West Australian, 22 July 2020