Raise the Rate of Newstart fact check

Do 99% of people on Newstart get other payments?

Yes. They receive the $4.40pw Energy Supplement. Combined with Newstart, it takes single people’s weekly income to $282, or $40 a day.

What about Rent Assistance?

Only 40% of single people on Newstart get Rent Assistance.[1] The maximum rate they may receive is $68.50pw (regardless of where they live), providing they pay at least $150pw in rent. Even if they pay more than this, which most people do, they don’t get more Rent Assistance.

What about Family Tax Benefit?

Less than 20% of single people receiving Newstart get Family Tax Benefit. Family Tax Benefit is to help cover the cost of children. The amount varies depending on the number and age of children.

Do most people only receive Newstart for a short period?

Two thirds of people receiving Newstart have received the payment for 12 months or more.[2] Over the course of 12 months, the majority of people who start to receive Newstart move off the payment, but this masks the large number of people who are long-term unemployed.

Who is on Newstart?

  • There are 722,000 people on Newstart. Half of Newstart recipients are over the age of 45.
  • One in four people on Newstart have an illness or disability, but cannot get the Disability Support Pension.
  • More than 100,000 single parents are on Newstart (as their youngest child is aged eight or more and they therefore do not qualify for parenting payment).
  • Older people, people with disability and single parents face challenges and discrimination in finding paid work.

What the Australian Government needs to do

  • Increase the single rates of Newstart, Youth Allowance and related payments by a minimum of $75 per week to reduce poverty and inequality across Australia.
  • Index payments to wages as well as CPI to ensure they maintain pace with community living standards.
  • Increase Commonwealth Rent Assistance by 30% or $20 per week for a single person on Newstart, as a first step.

 

Together, these measures would lift Newstart to be in line with UNSW’s assessment of the minimum income a single unemployed person needs to afford the essentials. They would help people afford food and housing, and reduce homelessness and severe financial hardship. These reforms would improve people’s wellbeing, security and health. Raising the rate would benefit entire communities.

[1] Answer to Question on Notice ‘SQ18-000163’ SQ18-000163.pdf

[2] Department of Social Services data, reported in ACOSS (2018) ‘Faces of Unemployment’ https://www.acoss.org.au/wp-content/uploads/2018/09/ACOSS_JA_Faces-of-Unemployment_14-September-2018_web.pdf p.8