1.4 million rent assistance recipients to receive 10 per cent boost to payments

Welfare recipients will receive a 10 per cent boost to their rent assistance payments, in what the government says is the largest and the first back-to-back increase to the maximum rates of rent assistance in more than three decades.

Pensioners and welfare recipients who depend upon Commonwealth Rent Assistance to keep a roof over their heads will receive a 10 per cent boost to the payment.

Age and disability support pensioners, carers, single parents and JobSeeker and Youth Allowance recipients who depend on Commonwealth Rent Assistance to keep a roof over their heads will receive a 10 per cent boost in the payment, in addition to a 15 per cent increase they received from September 2023.

The commitment, which will cost an additional $1.9bn over five years, comes alongside an extension of the freeze on deeming rates for pensioners and other welfare recipients, and an extra $54.90 per fortnight for Jobseeker recipients found to have a limited capacity to work.

Nearly a million households, including almost 1.4 million individuals, will receive the increase in rent assistance, which will see the maximum fortnightly payment for single-income support recipients rise from $188.20 to $207.02.

Social Services Minister Amanda Rishworth said the ­increase, combined with last year’s boost, represented both the largest and the first back-to-back rise in the maximum rates of rent assistance in more than three decades.

“It means that combined with indexation, maximum rates of rent assistance will have increased by more than 40 per cent since the Albanese government was elected,” Ms Rishworth said.

Minister for Social Services, Amanda Rishworth. Picture: NCA Newswire / Gaye Gerard

The government will also move close to 5000 Jobseeker ­recipients who have been assessed as being unable to work more than 14 hours a week due to physical, ­intellectual or psychiatric impairment – but have not qualified for the disability support pension – onto the higher rate of the JobSeeker payment.

This will see the rate for a ­single, childless JobSeeker recipient with limited capacity to work increase from $762.70 per fortnight to $817.60.

Ms Rishworth said the government recognised that those people experienced greater barriers to returning to employment than other JobSeeker recipients, and therefore required additional support.

“On average, these recipients remain on payments for almost twice as long as those without a partial capacity to work and are less likely to experience the benefit of work, with only around 9 per cent reporting earnings on average each fortnight,” Ms Rishworth said.

She said 36 per cent of those who would benefit from the increased payment were women, 34 per cent lived in regional and remote Australia, and 14 per cent were Indigenous.

The initiative will cost the budget $41.2m over five years, and apply from September 20, subject to the passage of legislation.

Indexation of welfare payments to the consumer price index is also set to continue, with the six-monthly increase also due to apply from September 20.

However, a forecast fall in the CPI from 3.5 per cent in 2023-24 to 2.75 per cent in 2024-25 is likely to result in this increase being lower than that which applied from March, and cost taxpayers an extra $2.2bn.

The base rate of JobSeeker for single, childless recipients has increased by $120 per fortnight, or 18.7 per cent, since the Albanese government was elected in May 2022 – representing an increase of more than $3100 per year.

Welfare recipients will also benefit from the $300 energy ­rebate, as well as a five-year freeze to the cost of medicines listed on the PBS, which will see pensioners and concession card holders – who receive six in 10 PBS scripts – pay no more than $7.70 per ­medicine.

This year’s budget initiatives follow a $4.9bn package introduced in last year’s budget, which increased welfare payments such as JobSeeker and Youth Allowance by an extra $40 per fortnight.