Labor has argued the government’s $50-a-fortnight permanent boost to welfare payments “does not do enough to support Australians facing poverty and hardship”, but the bill is still set to pass parliament next week with the opposition’s support.
In a report handed down on Friday, a government-controlled Senate committee backed its passage through parliament, while the Greens senator, Rachel Siewert, said the “pitiful” increase represented a “cruel and mean-spirited” cut from current Covid-boosted benefits.
In additional comments added to the report, Labor MPs reiterated that the opposition, which had flagged possible amendments earlier this week, would not “stand in the way” of a “modest increase” to welfare payments.
It follows the opposition’s social services spokeswoman, Linda Burney, saying on Tuesday her party was “going to support the increase”, and other comments last month suggesting the party may now go to the next election without a promise to further boost welfare payments.
Under the bill, revealed by the Guardian last month, the government will increase the base rate of jobseeker, student and parenting payments by $50 a fortnight, or about $3.50 a day, from April.
However, the coronavirus supplement – currently paid at $150 a fortnight – will be scrapped at the same time, meaning many see the change as a cut to the incomes of about 2 million people.
In their additional comments to the Senate inquiry report, Labor senators argued its only options were to back the “modest” increase or see the jobseeker payment revert back to the pre-pandemic base rate of $40 a day.
They claimed they were unable to propose or support a higher boost to payments because “amendments moved by the opposition or the crossbench to increase the rate of payments, or otherwise increase expenditure, would not be considered by the House of Representatives”.
The opposition is yet to determine whether it will still seek to amend other aspects of the bill, but Labor senators backed concerns about proposed changes to the income-free area.
Under that change, the amount jobseekers can earn from employment before their payment is cut will reduce from $300 to $150. Before the pandemic, the threshold was $106.
In a dissenting report, Siewert argued for the jobseeker payment to be increased to the Henderson poverty line of $1,115 a fortnight, or $80 a day, the same rate supported by the Australian Unemployed Workers Union.
The Greens senator argued that “by keeping income support payments below the poverty line, this government is wilfully choosing to condemn Australians to living in poverty”.
“This is going to have a devastating impact on people across Australia,” she said.
The committee chair, Liberal senator Wendy Askew, said the $50-a-fortnight boost was the “largest increase to working-age support payments in more than 35 years”.
“The committee notes that the permanent increase represents a cost of an additional $9bn to the social security and welfare budget across forward estimates, accounting for around a third of all government spending,” she said.
Askew said the committee believed the “taxpayer-funded increase” of $50 a fortnight “balances the need to ensure payments encourage and enable workforce participation with the need for the welfare system to be fiscally sustainable for future generations”.
Since the mid-1990s, the jobseeker payment has only increased above inflation once, in 1994, and since the Howard era, it has fallen behind the age pension because it is pegged to inflation, rather than wages.
The government said last month it would accompany the increase to payment with a hotline for employers to report jobseekers who do not take up work, and increased auditing of the quality of welfare recipients’ job applications.
However, data provided to the committee suggests large numbers of jobseekers are already being penalised under the government’s welfare compliance regime.
Since mutual obligations were reintroduced on 28 September, 616,862 jobseekers across jobactive, ParentsNext and Disability Employment Services had received a payment suspension. This means their payments were stopped temporarily and may have been delayed.
In the Community Development Program, often known as remote work for the dole, the figure was 19,597.
Guardian Australia has previously reported that many payment suspensions – which are partly automated – are applied in cases where welfare recipients were later found to have a “reasonable excuse” for missing their mutual obligation activity.
