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welfare to work & disability « Previous | |Next »
September 14, 2005

I just managed to catch a glimpse of this briefing in Canberra on the effects of the welfare-to work reform on disabled Australians organized by National Foundation for Australian Women on free-to air television last night. The briefing was based on research conducted by the National Centre for Social and Economic Modelling(NATSEM).

Under the Howard Government's proposals people with disabilities who are assessed as being able to work at least 15 hours a week will have to look for jobs after July 1 next year or be moved from the disability support pension to the lower paying unemployment benefits.The consequence is that single parents and those with a disability who do not find work will find their income falling by about 20 per cent because they will be placed on the unemployment benefit. The report found people with disabilities who do not work will be $46 a week worse off under the changes.

The justification for the reforms is that if people are capable of working part time, then there's an expectation they should work. If people are living in poverty it is because they are unemployed and do not work.

NATSEM director Ann Harding said that their scrutiny of the proposals showed they would "trap a new group of Australians into poverty" by shunting some disabled people and sole parents off higher-paying pensions and onto the dole. At the same time, the changes would give them less financial incentive to work because they would keep less of any earned income. She added:

The way to get out of the Newstart poverty trap is effectively to get a full-time job (but) sole parents and the disabled have got restrictions on their ability to undertake work.

Those who find work will discover that the Government takes more money out of their pay packet because of a harsher income test and the requirement for them to pay income tax. At the moment those who do not work under the current arrangements receive $254. Under the proposed system, those who work the 15 hours a week required of them, on the minimum wage, would receive $288, including their welfare allowances.The report found the difference of $34 equated to 15 hours' work at just $2.27 an hour.

Professor Harding said the Government's proposed changes did not create a financial incentive for people with disabilities to find work because they would only be working part time.

| Posted by Gary Sauer-Thompson at 10:31 AM | | Comments (0)