Young & Neglected Youth Allowance increases by less than $100 per fortnight in a decade

The National Welfare Rights Network (NWRN) today released a disturbing analysis of income support payments over the past decade which reveals that welfare payments for young people have risen by less than $100 a fortnight.

A new analysis released today on rates and payment increases for single students and unemployed people over the last decade strengthens the case for increasing the Allowances by $50 per week in the May Budget.

Over the last decade payments for the young unemployed and students only increased by $97.50 per fortnight.  Over the same time, payments to those in receipt of Newstart Allowance only increased by $125 per fortnight, said Maree O’Halloran from the National Welfare Rights Network (NWRN) today.

Andrew Cummings, Executive Director of the Australian Youth Affairs Coalition said: “Do we want to be a country that steps on people when they fall or offers a hand up?   The evidence is clear that $29 a day is causing problems for too many young Australians. They are simply unable to keep a roof over their head, feed themselves, pay bills and let alone look for work on a sum that hasn’t been increased in real terms for nearly 20 years.  If we want our Young Australians to succeed then we need to do better than $29 a day.”

The NWRN has compared the maximum rate of the single pension over the past decade to the maximum rate of the single Newstart Allowance and the single rate of Youth Allowance paid to young people who are unemployed or studying.  The main reason for the growing gap between the allowances and the pension is that the indexation method used for allowances is not as good as for pensions and the indexation is applied to lower base rates.

We know from our members’ casework experience that many people receiving the maximum Age, Disability or Carer Pension are finding it very difficult to make ends meet and their payments have increased by 80% over the decade. By comparison young job seekers and student allowances have only increased by 31% in the same timeframe.

In the decade from 20 March 2003 to 20 March 2013, the single fortnightly rate of pension increased by a much needed $368.10 per fortnight, from $440.30 to $808.40. In simple terms an increase of 84%. Research has clearly shown, for example, that the historic $35 per week increase to the pension in 2009 lifted many single older people out of poverty.  The NWRN welcomed this important increase.

Over the same decade, however, the single maximum fortnightly rate of Newstart Allowance only increased by $125.30, from $380.10 to $505.40. This represents an increase of 33%.

Rate increases for young people on Youth Allowance would have barely registered in their day to day living, with fortnightly payments only rising by $97.50 over the decade. An 18 year old living away from home received $310 per fortnight in 2003, and $407 in 2013.  With payments at this level many young people who cannot find paid work that can be combined with full-time study may well be couch-surfing with no permanent accommodation.

The Government needs to act in the May Budget to ameliorate the difficult financial circumstances experienced by young people who are either unemployed or studying and living on just $29 a day.

For comment:

Maree O’Halloran, President, National Welfare Rights Network: 0417 672 104

Andrew Cummings, Executive Director of the Australian Youth Affairs Coalition: 0435 146 979

Gerard Thomas, Policy and Media Officer, Welfare Rights Centre: 0425 296 882.

For the Full Media Release click here