MEDIA RELEASE: COTA calls for increase in Newstart Allowance

The federal government must increase income support for the unemployed or more Australians will live in poverty, said COTA Australia in its submission to the Senate Inquiry investigating this issue .

COTA Australia Chief Executive, Ian Yates, said unemployed older Australians are more likely to find themselves on the Newstart allowance for longer periods of time, struggling to live on $35 a day.

Newstart payments are simply too low and do not allow Australians of any age who find themselves out of work to maintain an acceptable quality of life,” Mr Yates said.

“The Newstart payments of just $35 a day is the same as 20 years ago. In 2012, this is not enough to survive.

“Most people over 50 who are on an income support payment are on Newstart, and they make up mo re than 25% of all people on Newstart .

“The chance of staying on Newstart allowance for longer periods also increases with age, with 28% of the long-term unemployed ag ed over 55.

“As such, the low allowance unfairly discriminates against older Australians who find themselves unemployed later in life – often due to age discrimination .

“People eligible for the age or disability pension receive $133 more a week than tho se on Newstart allowances, and that gap is widening because of the different indexation rules . At current rates, Newstart will be worth only half of the pension in 20 years time.

“Furthermore, those on Newstart face activity and work requirements, tighter income tests and less generous concession card arrangements than those on pensions, compounding their disadvantage.

“People think that pensioners are doing it tough, and many are, but those who suddenly find themselves unemployed later in life but before pension age are doing it even tougher.

“We call on the Government to increase the allowance by $50 a week for singles in the next budget, and to bring its indexation in line with those for disability and age pensioners.”

Media contact: Ian Yates 0418 8 35 439 , Anastasia Stomo 043 224 3389