Welfare benefits to rise $75 a week in post-coronavirus lifeline

Out-of-work Aussies could receive $10 a day more than before the pandemic as the Morrison Government considers permanently lifting the JobSeeker payment by $75 a week.

THE Federal Government is considering a plan to permanently boost the unemployment benefit by about $75 a week, putting an extra $2900 a year in the pickets of out-of-work Aussies.

Seniors ministers told the Sunday Tasmanian the increase, which would take the base rate from $565.70 a fortnight to $715.70, is now the preferred option among economic ministers. Treasurer Josh Frydenberg is expected to unveil a permanent boost to the dole as part of the mini-budget in July.

Treasurer Josh Frydenberg. Picture: AAP/LUKAS COCH

About 20,000 Tasmanians receive the JobSeeker welfare benefit.

Social services advocates have campaigned for years that JobSeeker payments, previously known as Newstart, were not enough to support families doing it tough.

The extra assistance is expected when the Government outlines the next phase of its economic response to the COVID-19 crisis.

Until the pandemic hit, the Federal Government had resisted calls to increase the $40-a-day dole payment. But at the height of the crisis, the welfare payment was lifted from a base rate of $565.70 a fortnight to $1115.70 as part of a temporary measure that expires in September.

Now several ministers have confirmed the rate would be permanently lifted.

“There is no way it can go back to what it was. We have people on welfare that have never been out of work, and now they are lining up outside Centrelink,” one minister said.

It is understood a $75-a-week boost, which would see the daily rate rise by $10, is the preferred option among Cabinet ministers.

“That appears to be the favoured option at the moment,” another minister said.

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It is estimated that a $75-a-week increase would cost the federal budget $3.3 billion a year.

But a 2018 Deloitte analysis commissioned by the Australian Council of Social Service found a $10 a day increase would boost consumer spending and help create more than 12,000 jobs.

“That money goes as extra income to a group that, on average, is the poorest of the poor in Australia. Other things equal, most of it is therefore spent. So it’s no surprise that the bulk of the dollars — some $3.3 billion a year — show up as extra spending by consumers,” the analysis found.

In just three months, the jobless rate jumped from 5.1 per cent to 7.1 per cent, as an extra 205,000 joined the dole queue.

The National Party represents one third of the 25 electorates with the highest dependency on JobSeeker, prompting its MPs to speak out.

The push to boost the JobSeeker rate comes as Treasury finalises its review of the $70 billion JobKeeper wage subsidy scheme.

The Sunday Tasmanian understands ministers are split on whether to roll back the scheme sector by sector or stop the payment for all industries at the same time.

Social Services Minister Anne Ruston said the Government had been clear all along the measures are “temporary, targeted and scalable”.