Can you survive on government benefits?

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September 26 2019
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Aussies relying on government benefits while unemployed are being asked to live on $7 a day for food, utilities as well as the added burdens of jobseeking if they want to live close to potential workplaces, new research has revealed.

A study from Swinburne University of Technology and RMIT University has looked at the cost of living across all Australian capital cities, finding that the average share-house rent in each city’s inner suburbs is at least 70 per cent of a Newstart recipient’s income.

In Sydney, where the median rent is $550 a week, the research split such a cost between two renters which still amounts to $275 each.

This would leave a renter on Newstart with only $48.24 a week or $6.89 a day to live on.

For Australia’s second-largest city, Melbourne, the third most expensive rental market it does not get much better, with 70 per cent of income spent on rent. This leaves jobseekers $98 a week to pay for necessities including food, utilities and the cost of seeking a job including generally required mobile phones and travel cards.

What about leaving the inner cities?

If Newstart recipients want to leave the inner city, their payments will still not go far enough to reach acceptable financial stress levels, the report found.

In Victorian regional cities like Bendigo and Ballarat, the rent for sharers exceeds the commonly accepted 30 per cent benchmark that would indicate an individual is under housing affordability stress.

In these locations, recipients would still be paying $130 a week in rent – almost half their Newstart payments.

Even with rent assistance, that would leave them with $192 – still $24 less than the healthy benchmark.

The study’s researchers found only two regions in all of Australia where single unemployed people would have any hope of meeting rents without being considered as under housing stress: northern Tasmania and outer Hobart.

But in these localities, other issues prevail: The youth unemployment rate is up at 16 per cent.

The findings come after nestegg reported that 7.3 million Australians would be forced to look to government benefits such as Newstart if they found themselves unemployed.

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.

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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