Coalition poised to lock in permanent dole rise

The Morrison government is poised to legislate a permanent increase to fortnightly dole ­payments as early as next week once the $150 coronavirus supplement ends.

Scott Morrison has hinted that the government would move to a permanent increase to the dole. Picture: Gary Ramage

The Morrison government is poised to legislate a permanent increase to fortnightly dole ­payments as early as next week, as ­cabinet’s budget committee is expected to sign off on a ­potential new welfare payment on Friday.

The Australian understands that a meeting of the expenditure review committee of cabinet will meet on Friday afternoon to finalise a package that is ­expected to enshrine an effective permanent rise in the rate of ­JobSeeker payments once the $150 coronavirus supplement ends on March 31.

A favoured option is to streamline the income support payment system into a single ­increased payment for unemployed Australians and abolishing up to a dozen other supplements or subsidies available to recipients.

With only two sitting weeks of parliament remaining before both JobSeeker payments and the JobKeeper program end, a ­senior government source said the Coalition would seek to ­introduce legislation next week to ensure it could be passed by both houses and come into ­effect before the end of March.

Also on the table is a new package to replace JobKeeper in favour of targeted packages aimed at providing continuing support for the hardest hit industries and regions.

The Australian understands the expenditure review committee met on Wednesday to ­advance the option of a reform package to accompany a permanent rise to JobSeeker once the COVID supplement was taken off. It will meet again on Friday when a final decision is expected to be made.

It is also understood there was resistance from some members of the committee to such a reform package because many of the supplementary payments were not accessed by all recipients and bundling them into a single payment could place ­additional structural pressure on the budget.

The welfare lobby, Labor and the Reserve Bank have all backed a permanent increase to the dole.

Senior ministers privately expressed their support for it and Scott Morrison has hinted that the government would move in this direction.

Before the introduction of the coronavirus supplement, which began last March at $550 a   fortnight before being tapered down to $150 a fortnight, the base rate of JobSeeker ­payments sat at $565 a fortnight for a single non-renter who did not have any ­dependants. A senior government source said last week a streamlined dole payment was being considered.

This would scrap a long list of other low-value legacy supplements available to the unemployed and roll them into a single increased payment that would leave them better off.

The source said that any outcome would ensure that those on income support would be better off.

The reform option would address the recommendations of the 2014 welfare reform review by Patrick McClure, which sought to overhaul the payment system by scrapping more than 20 supplements and replacing them with four new well-targeted payments.

The Prime Minister said last week that the government was considering its options following calls from welfare lobby groups, backed by the Reserve Bank, for a permanent increase to the underlying rate of JobSeeker when the COVID supplement ended on March 31.