Who ‘deserves’ income support and why? An important new study on the social legitimacy of benefits sheds light on why some groups and some benefits are more favoured than others. This helps explain why the Newstart Allowance is $160pw less than the pension, why there are periodic ‘moral panics’ over the so-called ‘rorting’ of the DSP, and why people are concerned when millionaires receive Age Pensions. It also helps inform the design of social security payments.
Indexation of social security payments is a dry subject. Does it really matter if they’re indexed to MTAWE or CPI? You bet! The Government’s budget proposals to index pensions only to the CPI and not to wages would reduce them by $80pw in a decade compared with present indexation, and save a motza. The Rudd Government’s decision in 2009 to index family payments to CPI instead if wages has saved over $1B and has already cost a low income family with 2 children under 13 years $19pw. If Newstart Allowance had been indexed to wages as well as the CPI over the last 20 years, it would now be $115pw higher ($52 instead of $36 a day).
In 2010, 2,548,000 people (14%) including 603,000 children (18%) lived below the poverty line in Australia. In that year the poverty line for a single adult was $400 per week.
The risk of poverty was much higher for people on unemployment (55%), sole parent (47%) or disability payments (48%). One third of people living in poverty were in a wage-earning household.
To find out who is living in poverty, see the ACOSS ‘Poverty in Australia‘ Report. .