Tue Feb 23

$50 a fortnight rise in JobSeeker comes with tougher job search requirements

Written by: Michelle Grattan, Professorial Fellow, University of Canberra

The base level of JobSeeker and related payments will increase by $50 a fortnight from April 1 under changes that will also toughen the obligations on people seeking work.

The boost will take the payment to $307 a week. It will go to 1.95 million people, including those on parenting payments, Austudy and Youth Allowance.

But those on unemployment and related payments will be worse off than they are now, because they will lose the temporary coronavirus supplement ^[1], which is currently worth $150 a fortnight. This expires at the end of March.

The amount of money a person on JobSeeker and related payments can earn before their payment is affected will be set permanently at $150 a fortnight. Pre-Covid this was $104. During COVID it went to $150, then to $300, where it is now.

From early April, job seekers will have to search for a minimum of 15 jobs a month, rising to 20 jobs a month from July 1.

The Australian Council of Social Service strongly attacked ^[2] the decision, saying it was a cut to people’s current income and is “a measly $3.57 a day more than the brutal old Newstart rate.”

ACOSS CEO Cassandra Goldie said: “Already, at $51 a day with the temporary coronavirus supplement, people on JobSeeker are currently being forced to make impossible decisions.

"Now, come the end of next month, they are expected to struggle on even less – just $44 a day to cover the essentials of life, including rent, as well as the cost of job searching.”

The cost of the changes is $9 billion over the forward estimates. The government said this was the largest-ever budget measure for working age payments, and the single biggest year-on-year increase to the rate of unemployment benefits since 1986.

Announcing the changes, Prime Minister Scott Morrison had an eye on those on his own side who might be critical of the rise.

He said it was true this was the single largest increase in the JobSeeker payment since the mid-1980s. He added, “but I think the more relevant feature to focus on is what it is as a percentage of the minimum wage. And this brings [that] up from 37.5% up to 41.2”. That is commensurate with where it sat during the period of the Howard government.“

Among the other changes the government announced:

temporarily extending the waiver of the ordinary waiting period for certain payments for a further three months to June 30
temporarily extending the expanded eligibility criteria for JobSeeker and Youth Allowance for those required to self-isolate or care for others as a result of COVID to June 30.

The stringent mutual obligation requirements will include an employer reporting line that will be established to refer job seekers who are not genuine about their job search or decline the offer of a job.

Some job seekers will have to take part in "work for the dole” after six months. They will have the alternative of taking an approved, intense, short course instead.

Job seekers will also have to return to compulsory face-to-face services with Jobactive providers, and there will be increased auditing of job applications to make sure they are genuine.

Morrison said: “Welfare is a safety net, not a wage supplement. We want to get the balance right between providing support for people and incentives to work.”

Speaking before the announcement, Nationals backbencher Matt Canavan expressed doubt. He told Sky: “Before the coronavirus I thought it was fair to look at increasing the unemployment assistance, it is very low.

"That was all before we racked $1 trillion up on the nation’s credit card.

"I just think we’re borrowing too much from overseas, we’re borrowing too much from the Chinese government.”