Cut dole to $40-a-day except for long-term jobless: Employer group

We’re sorry, this service is currently unavailable. Please try again later.

Advertisement

Cut dole to $40-a-day except for long-term jobless: Employer group

By Jennifer Duke

One of the nation’s largest employer groups wants the dole cut to its pre-coronavirus rate except for those who lost their job before the pandemic, while asking the government to extend its wage subsidy scheme for businesses grappling with an ongoing hit to revenue.

The Australian Chamber of Commerce and Industry has asked the government to let the JobSeeker rate revert to the indexed pre-coronavirus level from April, worth $565.70 a fortnight, or about $40 a day for anyone unemployed for less than a year.

Centrelink queues surged at the height of the virus however the unemployment rate has improved.

Centrelink queues surged at the height of the virus however the unemployment rate has improved.Credit:Jason South

However, the chamber’s pre-budget submission has also suggested keeping the current $150-a-fortnight coronavirus supplement for another 12 months for those who are long-term unemployed. An alternative proposed by the group is to retain this supplement until the jobless rate drops below a certain level and make an extra payment to cover an internet connection to help apply for work.

By the end of 2020 the national unemployment rate had fallen to 6.6 per cent, down from a peak of 7.5 per cent in July on Australian Bureau of Statistics data, but still up 1.5 percentage points compared with the same time in 2019.

At the height of the outbreak of the virus the federal government introduced a $550-a-fortnight supplement in addition to the standard dole level, effectively doubling the payments, but it has since tapered this support as more Australians returned to the workforce and restrictions eased.

“It is critical to get the balance right between the needs of the unemployed, the fiscal impact on the economy and the appropriate rate that incentivises those who are able, to get a job,” the chamber submission says. “The current jobs crisis has significantly increased the difficulty in this cohort finding a job, meaning the JobSeeker allowance, and importantly other financial support will be needed, at least for the short to medium term, to support long-term job seekers.”

Social services groups and a large group of economists and academics have backed a permanent increase in the dole for all people who are unable to work, saying the current rate is too low to cover the essentials.

The chamber has also requested the multibillion-dollar wage subsidy scheme JobKeeper be extended in two tiers for businesses that were “successful economic contributors and job generators” before the pandemic and continue to be affected by government-imposed restrictions.

Advertisement
Loading

JobKeeper is scheduled to end in late March, at which point the business group wants companies with a third or more cut in turnover to get $450 a week per employee and those with two-thirds or more of turnover cut to get $700 a week per employee in support. This would likely include airlines and those reliant on international visitors.

However, Prime Minister Scott Morrison on Monday spurned calls for a big stimulus to replace the JobKeeper subsidy after $251 billion worth of federal payments to keep the economy afloat.

“You can’t run the Australian economy on taxpayers’ money forever,” Mr Morrison said at the National Press Club. “The task now is to continue our economic recovery by sticking to our economic recovery plan and exercising the fiscal discipline necessary to ensure that we do not overburden future generations and continue to spend taxpayers’ money wisely.”

A pre-budget submission from the Actuaries Institute has raised concerns about the economic inequality among the generations due to the pandemic, with recent asset price appreciation such as home value increases helping boost the net wealth of older Australians but doing little to help younger workers.

“Increases in unemployment are greatest for younger Australians, and there is past evidence of long-term labour market scarring for those who enter the labour market during a recession,” the Institute says. “This, combined with increased government debt, means that while the direct health impacts of COVID-19 fall more heavily on older Australians, the young shoulder much of the economic burden.”

Start your day informed

Our Morning Edition newsletter is a curated guide to the most important and interesting stories, analysis and insights. Sign up to The Sydney Morning Herald’s newsletter here, The Age’s here, Brisbane Timeshere, and WAtoday’s here.

clarification

This article initially said the proposal was for the dole to be returned to the base rate for those who were unemployed before the pandemic rather than the newly unemployed.

Most Viewed in Politics

Loading