17 October 2019
I would also like to speak in favour of Senator Siewert’s motion today, and I would like to congratulate her on her strong advocacy on this issue. Like her, Labor also calls on the government to immediately increase the rate of Newstart and youth allowance. We note in the motion that’s been presented to the Senate that this week’s also Anti-Poverty Week. The easiest action that we all can take to reduce income inequality and effectively reduce poverty in Australia would be to increase Newstart and youth allowance. There is an enormous amount of evidence available that shows the merits of lifting Newstart and the negative impacts of continuing to leave vulnerable people without enough income to survive.
Earlier this year, I visited Ozanam House in North Melbourne, a crisis and transitional accommodation facility for homeless Melburnians run by VincentCare, which has recently been renovated. When I met with them, the leadership team made a point of describing to me how desperately low the rates of Newstart and youth allowance are and the impacts that had, the risks for people living on the cusp of homelessness and how it made getting back into a stable situation very difficult for people who have fallen into that black hole.
In July, the CE of cohealth, one of Victoria’s largest community health services, wrote to me to share her organisation’s concerns about the impact of the low rate of Newstart and what that is having on the health and wellbeing of vulnerable Victorians. She told me that the people trying to live on Newstart ‘cannot afford the costs of health care, meals are skipped and fresh nutritious food too is often out of reach, and the stress caused by worrying about paying for bills and keeping a roof over their head is a constant and significant issue’. She also quoted, in that letter to me, a report that showed vulnerable people are twice as likely to have a long-term health condition, as well as twice a likely to suffer from chronic illness, and on average will die three years earlier.
In 2018, a Deloitte Access Economics report for the Australian Council of Social Service highlighted the inadequacies of the indexation arrangements that applied to Newstart. I touched on this area in my first speech in this chamber. There’s also a need to review the increase in the length of time that people are spending on Newstart—and I know Senator Siewert made mention that it’s about three years on average. It’s a disgrace that people are having to wait that long in order to transition into work, as it’s called, when this government keeps talking about reducing the unemployment rates and about the number of jobs that they supposedly create. But what we are finding is that there is a large cohort of people out there in the real world who are doing it tough and who are struggling to find meaningful work.
That same report also clearly laid out the inaccuracies in the government’s position. The Liberal-National government like to claim that the low rate of Newstart encourages recipients to get a job and they keep saying that the best form of welfare is a job. A job is not welfare. As we’ve also spoken about in this place on numerous occasions—and I know it’s in Senator Keneally’s portfolio area and I’ve also been assisting her on it—a number of workers have been exploited and have been paid below the minimum wage. For this government to talk about how there are all these jobs out there—well, where are they? People are clearly struggling to find work and to transition into meaningful opportunities. What Deloitte also found was that Australia has a very low Newstart payment, and when you compare that to other wages the fact is that the rate of Newstart is way too low and acts as a barrier to people trying to find work. They cannot afford the transport to get to interviews. They can’t buy the appropriate clothing or equipment. They can’t even afford the training and education that they need to get back into the workforce.
As respected ANU economist Peter Martin has pointed out in a piece for The Conversation just last month:
A decade ago the Organisation for Economic Co-operation and Development warned that Newstart was low enough to raise “issues about its effectiveness in providing sufficient support for those experiencing a job loss, or enabling someone to look for a suitable job”.
And there’s no guarantee that a job is even available.
Earlier this week we read Anglicare’s jobs availability snapshot, which showed that five jobseekers are applying for every entry-level position. And, by their own admission, Anglicare says, ‘This is a conservative estimate because it does not include the 1.8 million Australians who say they’re underemployed.’ It’s hard to believe, and yet this is the situation that the Liberal-National government have created. They have made it almost impossible for someone to find work while on Newstart, while at the same time demonising Newstart and other welfare recipients for not getting a job.
We are trapping people in poverty and then blaming them when they find it impossible to get out of the black hole. On a human level alone, the evidence shows how critical it is that this government acts immediately to increase Newstart. The case for an increase to Newstart on an economic basis is also compelling. The same Deloitte Access Economics report found that an increase of $75 a week would return about $1.5 billion a year in extra tax, as recipients spend the increase and boost the economy.
In June this year, the Governor of the Reserve Bank of Australia, Philip Lowe, suggested that, although it was a matter for the government, an increase to Newstart would help stimulate the economy, as would any increase to household income.
I also noted that the Grattan Institute, which the government usually relies on for a number of their reports, wrote a paper in July on this subject matter. They described that there are many ways that the Treasurer could stimulate the economy. Surprise, surprise, they said a boost to Newstart would offer the economy an immediate stimulus. The Grattan Institute said:
… it puts money in the hands of the people most likely to spend every cent.
Not to mention the savings for the taxpayer that would arise from the cohort of people who would likely be healthier and in more stable housing, better able to get a job and would spend less time on welfare should they find themselves in the unfortunate situation of being without work.
The list of people and organisations calling for an increase in Newstart is growing ever longer. This includes some notable entries, including a number of conservative MPs and senators in this place. They join organisations like the Australian Council of Social Service, St Vincent De Paul, church groups and welfare advocates who have been arguing for a rise in Newstart for many, many years. One doesn’t have to search far to find the real-life stories of people who live the experience of trying to make ends meet on Newstart.
Today I want to fill my speech in this place with some words of others. I do so because this issue is now beyond the rhetorical one-liners, the gotcha moments, that those opposite constantly throw back at Labor, the Greens and others on the progressive side of politics. I want to lay out the voices and clear evidence calling for an increase to Newstart and give voice to those who are living every day on just $40 a day. And I bet a lot of us in this place would spend $40 a day just at Aussies—on coffee, cakes and other things for lunch and dinner. The time is well and truly passed to increase Newstart. For the sake of the people tonight who will go hungry and their children who shiver in the cold, for the sake of people who are sick because they can’t afford to get better, and for the many women who want to leave violent relationships, we on this side urge the government to immediately raise the rate of Newstart.