Push to raise Newstart allowance by $75 a week
SCOTT Morrison is being urged to raise the Newstart welfare payment by $75 a week after economists found it would create an extra 12,000 jobs and inject $4 billion into the economy.
Deloitte Access Economics has found that increasing the payment, which is currently less than $40 per day, by $10.67-a-day or $75 per week would lift consumer spending and in turn create an extra 12,000 jobs, lead to wage rises of 0.2 per cent and boost the economy by $4 billion.
It also found regional areas of Australia would benefit most from the government raising the payment.
The Australian Council of Social Service, which commissioned the Deloitte report, is now redoubling its calls for the Prime Minister to increase Newstart.
"The message from the economists at Deloitte is clear: lifting Newstart and reducing poverty and inequality is resoundingly good for the economy," ACOSS chief executive Cassandra Goldie said today.
She called on the government to boost the payment, currently $545.80 a fortnight, by $75 per week as "a matter of urgency".
"Not only is it the right thing to do as a matter of social justice, it will provide the necessary economic boost regional economies so desperately need," Dr Goldie said.
Deloitte's report found increasing the Newstart payment would cost the federal government $3.3 billion per year, only slightly less than the expected financial gain.
And the number of extra jobs created was expected to slip back to around 4400 by 2024-25 and to 500 jobs by 2029-30.
But the report noted that the welfare payment increase, which would benefit Australia's poorest people who mostly live in regional areas, would likely deliver better national outcomes in health and reduced crime.
It also noted that countries with higher levels of inequality tend to have lower economic growth over time.
Opposition leader Bill Shorten has previously committed to reviewing the Newstart payment if Labor wins government.