$3.57 a day? Don’t Spend It All At Once!

Or, buy a weekday copy of The Australian for $3.50 to find out how much of a dole bludger you are. Not on the weekend, that’s $4.50, and outside your vastly expanded unemployment budget…

Today The Guardian published news that the Morrison government was further cutting the unemployment benefit—which for a few months stood at around $80 per day—back to around $44 per day. A significant drop. Here’s a graph of where the benefit has stood, relative to the Australian poverty line.

A while back I mused on the startling munificence of the Morrison government, when in a mad March moment they doubled the unemployment benefit.

At the time, I asked: “Did the cost of living double!?” because that, on the face of it, should be the only reason to change the unemployment benefit.

The benefit is, after all, the amount we expect people to live on while seeking work. It’s reasonable to expect, therefore, that if the cost of living goes up, then so should the benefit. It’s also reasonable that the amount of the benefit should be enough for an Australian to live with dignity and be able to seek work. That’s reasonable, but far from the truth. For literally decades the unemployment benefit has remained virtually unchanged, and in January of 2020 it was significantly below the Australian poverty line, as can easily be seen from the chart.

Then suddenly the government doubled it, raising it above the poverty line. Then six months later, for as little good reason as when it was increased, they decreased it by nearly 30%, dropping it again below the poverty line; then three months later they decreased it by a further 12%, and then again three months after that by 14%, leaving it almost back where it had started. Well, better off than January 2020 by the princely sum of $3.57 per day.

Incredible… Incredible, and insulting, and punitive.

Were these changes related to the cost of living? Of course not1.

There’s absolutely no relationship between the cost of living and the benefit. So what was the government’s justification? Well, the original justification was ridiculous. It was increased, they said “because people will lose their jobs“. No kidding. I can only assume Australia’s pensioners were waiting hopefully for the pension to be increased as well “because people will retire”, but no such luck.

So what was the reason given for reducing the benefit, and in particular reducing it below the poverty line again? The answer was essentially “We want people to go back to work”! Did this make any more sense than the first reason? Of course not. Here’s a graph showing the percentage of job seekers for whom there was no job, versus the strangely changing unemployment benefit2,3.

Since January 2020, and before then in fact, there have been more than five unemployed or under-employed people seeking work for every available job, sometimes as many as ten. In raw terms, for example, in January there were 940,800 Australians unemployed (and over 1.1 million under-employed)3, competing for fewer than 180,000 jobs2. To suggest that reducing the unemployment benefit is somehow going to increase the number of jobs available is patently ridiculous, just as is the suggestion that most of these people don’t want a job.

The graphs tell the story of a deliberate, staged reduction in the benefit, with only one discernible purpose—to reimpose cruel and unnecessary suffering on over one million Australians, suffering that was alleviated, briefly, for a totally ridiculous reason, and is now being reimposed for equally indefensible and ridiculous reasons.

We understand their real reason: the unemployed are unemployed because it’s their fault, and they deserve to be poor and suffer. The cruelty and indignity of holding people below the poverty line is given a flimsy justification of “incentive”, but clearly that’s ridiculous when there are more than five applicants for every available job.

This is a cruel, vicious government; there’s no other possible explanation. Morrison’s momentary munificence has melted, just as we knew it would.

  1. https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/latest-release
  2. https://lmip.gov.au/default.aspx?LMIP/GainInsights/VacancyReport
  3. https://www.abs.gov.au/statistics/labour/employment-and-unemployment/labour-force-australia