There’s some relief in sight from the soaring cost of living for almost five million Australians, with welfare payments set to receive their largest indexation increase in up to 30 years.
- The maximum rate of pension will increase to $1,026.50 a fortnight for singles and $773.80 for each member of a pensioner couple
- Social service authorities say it’s just a “drop in the ocean” amid soaring cost of living expenses
- Cost of living is expected to increase further when the fuel excise tax cut ends later this month
The increase will be part of a routine recalibration to keep up with changes in the Consumer Price Index.
Treasurer Jim Chalmers said it was important for payments to keep up with inflation.
“That’s why they’re indexed twice a year, and every little bit helps,” he said.
“This indexation will be particularly big this month, because inflation is particularly challenging.”
The Age and Disability Support Pensions, along with the Carer Payment will all rise by $38.90 a fortnight for singles and $58.80 a fortnight for couples.
JobSeeker Payment, Parenting Payment, ABSTUDY and Rent Assistance will also increase.
From this month, Jobseeker recipients aged over 22 without children will get an extra $25.70 a fortnight, taking their Jobseeker to $677 a fortnight, including the Energy Supplement.
“And we know that it won’t solve every problem for everybody, but it’s important that we try and make sure that those payments keep up,” Mr Chalmers said.
“That’s what the indexation is about. It will be welcome even as we acknowledge that times will still be tough for a lot of people.”
Shadow Social Services Minister Michael Sukkar said the government could not take credit for the increase.
“Labor trying to claim credit for the automatic indexation of payments is comical,” Mr Sukkar wrote on Twitter.
Single parents will get an extra $35.20 a fortnight, taking their Parenting Payment to $927.40 including the Energy Supplement.
For couples on Jobseeker or Parenting Payments, the rate will increase by $23.40 a fortnight to $616.60 including the Energy Supplement.
The government says it’s the largest indexation increase to payments in more than 30 years for allowances, and 12 years for pensions.
The maximum rate of pension will increase to $1,026.50 a fortnight for singles and $773.80 for each member of a pensioner couple or $1,547.60 per couple.
But acting chief executive for the Australian Council of Social Service (ACOSS), Edwina MacDonald, said it wasn’t enough.
“It’s really just a drop in the ocean at this point and as the non-discretionary inflation is higher than the CPI, they are still going backwards in terms of what they can afford to buy at the moment,” she said.
Non-discretionary items include food, medicine and rent.
ACOSS has been calling for an increase in social security payments of at least 35 per cent.
“So, currently jobseeker is at $46 a day, youth allowance is at $38 a day and what we need in order to bring it up to the poverty line, is to bring it up to at least $70 a day,” Ms McDonald said.
Meanwhile, the cost of living is expected to increase further when the temporary cut to the fuel excise tax ends later this month, with Mr Chalmers ruling out an extension.
“It would be too expensive to continue that petrol price relief indefinitely,” he said.
“I think Australians understand that we’ve inherited a budget which is heaving with a trillion dollars in Liberal Party debt and that means some difficult decisions including this one.”
The Treasurer has written to competition watchdog the Australian Competition & Consumer Commission (ACCC), asking that it intensify monitoring of fuel prices with the re-introduction of the full excise.
While the ACCC has found that retailers mostly passed on the excise cut, prices still rose to their highest in 14 years.