Newstart debate must focus on people, not politics

Economics researchers at the University of Adelaide are urging politicians to address the issue of the Newstart Allowance with maturity and consider increasing it by as much as $120 per week.

A report published by the University’s South Australian Centre for Economic Studies (SACES) recommends raising the Newstart Allowance to help reduce the poverty gap for unemployed people.

SACES Executive Director, Associate Professor Michael O’Neil, says governments should concentrate on giving unemployed people the skills and support they need to gain employment, rather than making them easy targets for political ‘point scoring’.

“Our research is concerned with the increasing rate of poverty for those on Newstart Allowance, as the value has declined since the mid-1990s and the current rate of payment is making it difficult for many to have the required resources to find employment,” he said.

Interestingly, the report also highlights that the majority of long-term unemployed are actually older Australians. 

“Recent comments in politics illustrate a pervasive notion of the jobseeker as a ‘dole-bludger’, a recipient who is portrayed as an undeserving drain on the taxpayer. This is despite the fact that many unemployed individuals have a long work history, have paid taxes, and often—through no fault of their own—find themselves unemployed.”

A recent example of this is the thousands of workers in Australia’s automotive manufacturing industry who’ve lost their jobs as the industry collapsed. 

The Newstart Allowance currently stands at $278 per week; through comparison of financial and social indicators, the report recommends increasing it to between $360 and $400 per week. 

“An increase would be justified on the basis of equity for recipients and to reduce the poverty gap many of them face,” said Associate Professor O’Neil.

“There would appear to be general agreement on this from a wide range of stakeholders, including from the business community, the welfare sector, academics and researchers, and the wider community. Only the federal government stands outside this accord.”

The SACES report has been instrumental in this ongoing public debate, and has been forwarded to the Senate Standing Committee on Community Affairs, which is conducting an inquiry into the Newstart Allowance’s adequacy.