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Poverty tipped to rise as JobSeeker ends

  • July 21 2020
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Poverty tipped to rise as JobSeeker ends

By Cameron Micallef
July 21 2020

The number of Australians living in poverty is set to rise to nearly 4 million once the $550 JobSeeker allowance is returned to its pre-COVID level, new research finds.

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Poverty tipped to rise as JobSeeker ends

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  • July 21 2020
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The number of Australians living in poverty is set to rise to nearly 4 million once the $550 JobSeeker allowance is returned to its pre-COVID level, new research finds.

poverty homeless

The original JobSeeker rate was temporarily doubled from $550 a fortnight to $1,100 a fortnight as the government looked to support rising unemployment during the COVID-19 pandemic.

Analysis by the Australian Institute shows a further 650,000 Australians will be pushed into poverty once government support is effectively halved from 30 September.

The halving of payments will see 120,000 children in Australia impacted by poverty.

“The coronavirus supplement has been an essential part of our nation’s response to this recession and has improved the lives of nearly half a million Australians. In fact, no other government has ever lifted so many people out of poverty so quickly,” said Ben Oquist, executive director of the Australian Institute.

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“Removing the supplement would put more than 600,000 Australians, including more than 100,000 children, into poverty. This will not only have serious negative social effects for decades to come but makes terrible economic policy by effectively withdrawing much-needed stimulus.”

 

The Australian Institute’s senior economist, Matt Grudnoff, said Australians with investment properties could also be affected by the government’s plan to change COVID-19 support.

If the government removes the supplement, 242,000 renters and 246,000 mortgagors who were not in poverty before COVID-19 will be forced into poverty.

The economist highlighted how difficulties paying rent and servicing mortgages could negatively impact investors who own properties.

“As unemployment has increased over recent months, the JobSeeker supplement has been the only thing standing between many recently jobless Australians and poverty,” Mr Grudnoff said.

“If JobSeeker is cut in half, hundreds of thousands of Australians will find themselves struggling to pay the rent or service their mortgages for the first time.”

Poverty tipped to rise as JobSeeker ends
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About the author

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Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

About the author

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

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