A Newstart for the Coalition

By Austen Hunt

The debate in parliament surrounding the future of Newstart has shaken the stability of the Coalition Government. Ministers from within the National and Liberal ranks have broken file and spoken out in support of raising Newstarts payments. 

The call to increase welfare payments to Australia’s vulnerable and unemployed people has been made and it seems as though there are cracks appearing in the party for big business, the Liberal Coalition, as ministers are stepping forward to support it. 

So what is Newstart and why has it been so contested? 

Newstart is a government initiative which provides fortnightly payments to unemployed, and job-seeking, Australians to ensure that there is a minimum quality of life afforded to all. At present, the fortnightly payment for a single person with no dependents sits at the modest $555.70 a fortnight. This provides an Australian who is having to pay rent, feed themselves, transport themselves, and otherwise a meager $40 a day to live off. 

Newstart has been labelled as a ‘transitional’ support scheme meant to assist people with the cost of living while they find new employment. As the rate of unemployment in Australia continues to rise and the rate of business expansion continues to decline, it seems as though the dogmatic ‘jobs and growth’ vision of the Liberal Coalition may be under pressure. 

This pressure has forced Ministers from within the coalition to challenge the status-quo and has allowed for unlikely champions of welfare to emerge. A notable candidate, and arguably the catalyst for the reinvigoration of the debate surrounding welfare in Australia, has been Baranaby Joyce. Barnaby Joyce’s call to increase Newstart has stemmed from his position as the Member forNew England, an electorate which has been facing issues of unemployment and inadequate access to public services. This breaking of rank has lead to other Liberal members, Russel Broadbent and Dean Smith, to signal their support to increase welfare payments.

The Challenge

The challenge to the Newstart payment has been swift and successful in accruing cross-party and cross-sector support. The Greens Senator Rachel Siewert has called for ministers and senators to act upon their rhetoric and support a private members bill which calls for a $75 a week increase to the payments. This call to increase support payments has gathered support from the Greens, Labour, the Australian Council of Social Service, the Business Council of Australia and even the Reserve bank Governor. 

The call to increase Newstart is not only a call to increase the standard of living for Australia’s vulnerable demographics, but a call to recognise that Australia’s economy needs a readjustment. The Department of Social Services has reported that at present there are 257,494 people on the Newstart program, 191,680 of which have never previously been receiving income support. What is more, the majority of those who have been pushed out of employment and onto support schemes have been women aged between 55 and 64, posing questions to the ease at which these people can be re-skilled and re-located within Australia’s economy. 

The Response?

The response from our leaders in parliament house has been disparaging at best and condescending at worst. The Liberal coalition headed by the incumbent Scott Morrison has outlined that increasing Newstart would unnecessarily burden Australia’s economy. The point comes from the figures that increasing the Newstart payments by $75 a week would place an annual cost of $3.3 billion on the Australian tax-payer. 

The cost on the Australian taxpayer is a contentious topic- since forming government the Liberal Party has pursued tax breaks for the highest income earners of Australia and entrenched costly schemes such as Franking Credits. The disproportionate tax relief for Australia’s highest income earners, earning over $180,000 a year, is set to be lowered to a modest 30% tax rate, placing an individual who earns $180,000 on the same bracket as an individual who earns $41,000 and saving them a minimum of $11,000 a year. 

The jury is still out as to how this private members bill will impact policy developments, however, when questioned at a recent press conference, the current Prime Minister Scott Morrison had a simple response of “how good are jobs”. 

A nod to the inability of Australia’s leadership to address the rising unemployment rates within Australia.