Shorten rejects jobless benefit boost call

[Banker]

Employment Minister Bill Shorten has rejected a call from business, welfare groups and unions to raise the level of unemployment benefits.

The Newstart allowance for single jobless Australians stands at $243 a week, compared with $345 for the Disability Support Pension (DSP).

Outgoing Australian Industry Group chief and new Reserve Bank of Australia board member Heather Ridout has called for the dole to be raised as part of a wider welfare reform.
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But Mr Shorten has defended the $100 gap between unemployment and disability benefits, in an interview with The Australian.

"We need to remember that people on the DSP have special care and equipment needs, and recognise that disability is expensive," he said.

He also defended the existing benefit paid to the unemployed.

"Australia's social security system needs to provide a strong safety net for people who need financial assistance while also acting as an incentive for people to take up paid work."

A single person on the dole for a year would receive $12,700, which is well below the average full-time salary of $68,800.

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[Banker]

WELFARE groups will demand the dole be hiked by $50 a week in the upcoming May budget, ignoring a ruling by Employment Minister Bill Shorten that current $243 safety net is sufficient.

The Australian Council for Social Service wants the government to boost Newstart and Youth Allowance rates under a $3.6 billion budget wish list.

It also wants a doubling of wage subsidy scheme places for the long-term unemployed, a $500 million dental scheme and a $1 billion boost to rent assistance and affordable housing.

The peak welfare group has proposed $4.8 billion in savings to fund the measures, directed at higher income earners.

They include proposed cuts to private health insurance rebates, a crackdown on the use of family trusts to minimise taxes and remove capital gains tax perks for small businesses.

Acting ACOSS chief Tessa Boyd-Caine said there were "glaring gaps" in national policy efforts to reduce poverty and exclusion, most disturbingly the level of income support and employment assistance for the disadvantaged.

"It is clear that, at the beginning of 2012, progress in reducing unemployment further has stalled," Dr Boyd-Caine said.

"The solution to the tension between resources and need is not to retreat from reform but to pursue it more comprehensively, with a sustained attack on wasteful expenditure and tax breaks, while continuing social and economic reforms to improve support for those who continue to struggle to make ends meet."

Business groups have also supported the push to raise unemployment benefits, with outgoing Australian Industry Group head and new Reserve Bank board member Heather Ridout last week urging the $131-a-week discrepancy between Newstart and the Disability Support Pension be closed.

But Mr Shorten has rebuffed calls to increase the Newstart Allowance, as reported in The Australian today.

He said the dole was deliberately set at a level that encouraged people to take up paid work.

"Australia's social security system needs to provide a strong safety net for people who need financial assistance while also acting as an incentive for people to take up paid work," Mr Shorten said.

"Participation in the workforce is a priority the Gillard government is passionate about. Work is at the core of our beliefs."

A spokesman for Mr Shorten, who is also currently Acting Treasurer, said while the government respected the views of ACOSS it also remained "committed" to strong fiscal discipline.

"The government will continue its disciplined approach to spending, while also providing the necessary social protections for the most vulnerable in our community and ensuring our nation is prepared for long-term challenges such as the transition to a clean energy future and the ageing of the population," the spokesman said.

"Community views are a vital part of the development of Government policies and the budget process. As the Treasurer noted last month, submissions to the 2012-13 Budget should consider the Government's strong commitment to fiscal discipline and the need to offset any proposed new spending with equivalent savings."

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