Poverty risk rises with over 22,000 Canberrans to lose $300 per fortnight from Friday

This Friday, over 22,000 Canberrans face the loss of $300 per fortnight as the Australian Government’s Coronavirus Supplement is reduced, pushing many into poverty. The ACT Council of Social Service (ACTCOSS) is calling on the Australian Government to extend the existing Coronavirus Supplement of $550 per fortnight and to move quickly to legislate a permanent, adequate JobSeeker rate that means people can cover the basics.

ACTCOSS CEO, Dr Emma Campbell, said: “There are currently 22,676 people in the ACT receiving income support payments boosted by the Coronavirus Supplement. Around 15,000 of these are receiving JobSeeker and Youth Allowance while looking for work – this figure has more than doubled from just over 6,500 prior to COVID-19.

“Analysis undertaken as part of our latest ACT Cost of Living Report found that, prior to the Coronavirus Supplement, the single rates for Newstart (now JobSeeker) and Youth Allowance were $173 and $226 below the poverty line respectively.

“When the supplement is reduced by $300 per fortnight on Friday, recipients are again going to be pushed into poverty and be unable to cover the basic costs of rent, food, medical bills, utilities and transport.

“An ANU analysis of the impact of changes to the JobSeeker payment found that the $550 Coronavirus Supplement reduced the poverty rate for JobSeeker and Youth Allowance recipients from around 67% to just under 7%.

“Before COVID-19, it was estimated that 30,000 people were living below the poverty line in the ACT. When the Coronavirus Supplement is removed, given that 8,500 more Canberrans are relying on income support, poverty rates could increase by around 25%, nearing 40,000 individuals.

“The reduction and removal of the Coronavirus Supplement will see over 22,000 Canberrans face a struggle to afford food, rent, healthcare, and energy bills. A recent survey found that 80% of people receiving the supplement said they would have to skip meals and reduce how much fresh fruit and vegetables they buy once their payment is reduced by $300 per fortnight from this Friday.

“The changes will also have a negative impact across the ACT economy. Modelling by Deloitte Access Economics found that cuts to the Coronavirus Supplement will set the ACT economy back significantly, reducing consumption per person by $504, reducing economic output per person by $382, and resulting in the loss of 1,120 full-time equivalent (FTE) jobs in Canberra in 2021-22.”

Dr Campbell concluded: “The Federal Budget will be handed down on 6 October, one week before Anti-Poverty Week on 11-17 October 2020. One budget measure that would help prevent poverty would be to permanently increase the rate of JobSeeker and related allowances to an adequate level. This would also provide a much-needed boost to domestic consumption and local employment. Cutting the Coronavirus Supplement and returning JobSeeker to $40 a day is bad for poverty levels, bad for jobs, and bad for Canberra.”

Find the 2020 ACT Cost of Living Report here.

Find the results of an ACOSS survey on the impact of cuts to the Coronavirus Supplement here.

Find out about the Raise the Rate for Good campaign here.

Find out about Anti-Poverty Week here.

ACTCOSS advocates for social justice in the ACT and represents not-for-profit community organisations.

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