Newstart payments would need to increase by up to $300 a fortnight and the Age Pension by $11 a fortnight in order to close the poverty gap, says new research.
The Australian National University’s Centre for Social Research and Methods has examined welfare payments to see how poverty in Australia could be reduced.
Currently, the five welfare payments analysed by the research group costs around $100 billion each year, but the proposed formula could reduce poverty by as much as 11 per cent.
According to the research, in order to close the gap, unemployment benefits should increase by $270 per fortnight, the Age Pension by $11 and rent assistance by about $10.
To pay for these increases, Family Tax benefits (FTB) would need to be reduced by around $60 or more, and single parent payments by more than $30, reports The Australian.
“The reductions for family payments suggests that these payments are currently paid to many households and income units that are either not in poverty or have low poverty gaps,” says the paper.
“FTB can go to families, admittedly at a tapered rate, with incomes over $100,000. From a poverty perspective, it is perhaps not as well targeted with respect to income as allowances and pensions.”
The report comes on the heels of Labor’s pledge to increase the “shamefully low” dole level for hundreds of thousands of payment recipients by $75 if it wins the next federal election.
“Not a single soul in the Labor Party or the trade union movement thinks the rate of Newstart is fair or adequate,” said Inner-western Sydney mayor Darcy Byrne.
“After years of derogatory rhetoric towards Australians who are out of work, Labor has an opportunity this weekend to recast the national debate.”
Recently, YourLifeChoices asked its 230,000 members which of the Age Pension or Newstart should be given a priority if an increase was on the cards.
Around 78 per cent of those surveyed said that the Newstart base rate should be increased, but only 42 per cent said that should be prioritised over raising the Age Pension base rate.
It seems this formula may be the answer to both payments receiving a boost.
Read more at www.news.com.au
Do you think such a plan is fair? Would you like to see an increase to the Age Pension base rate?