Northern Territory Council of Social Service

Cuts to JobSeeker to cost the NT economy $348 million – Deloitte report

The Morrison Government’s planned cuts to the Coronavirus Supplement for people on JobSeeker, Youth Allowance and parenting payments would see the NT lose $348 million over the next two years and more than 2,500 jobs according to analysis by Deloitte Access Economics commissioned by The Australian Council of Social Service.

The old Newstart rate was effectively doubled when the Federal Government brought in the temporary Coronavirus Supplement in March. At the same time, the name of the payment was changed from Newstart to JobSeeker. The Government is planning to cut the Coronavirus Supplement on September 25, reducing incomes of people on JobSeeker by $300 per fortnight.

Unless the Government steps in, the Supplement will be removed entirely at the end of December, sending the incomes of people on JobSeeker down to the appallingly low old Newstart rate of just $40 per day.

The Deloitte report, released today, finds that if the Government cuts the Coronavirus Supplement on September 25 and then fully removes the Supplement at the end of December, this would:

  • Reduce the size of the national economy by $31.3 billion and see an average loss of 145,000 Full-Time Equivalent jobs over that same two-year period.


  • Reduce the Territory economy by $348 million and see a loss of an average 2,549 Full-Time Equivalents jobs over that same two-year period.


  • Existing levels of disadvantage in many Northern Territory communities will be compounded by the removal of the Coronavirus Supplement.

Deloitte Access Economics Lead Ally Nicki Hutley said:

“Every dollar that the Government invests in JobSeeker is generating a significant economic return, helping to pave the road out of recession. Providing people without paid work with enough to get by is highly effective economic stimulus, as they have little choice but to spend straight away on essentials.

“People on higher incomes have the option of saving, which many are doing right now given the uncertainty of the pandemic. This is why other measures, such as income tax cuts, would not be as effective in getting us out of this recession.

“Our analysis clearly shows that the Government’s plans to reduce income support would set back the economy even further. We also know that this would take a serious toll on the wellbeing of millions of people who are without paid work, especially those in regional communities.”

NT Council of Social Service CEO Deborah Di Natale said:

“The Coronavirus supplement has saved Territory jobs through this recession.

“It has seen increased consumption and demand for goods and services, supporting jobs in other parts of the economy.

“There are 33, 835 people receiving the Coronavirus supplement in the Territory.  That is money that is being spent, and is keeping our economy ticking over.

“The Deloitte report shows the Northern Territory has some of Australia’s most disadvantaged regions, and that they have been the worst hit in the current crisis.  They will also feel the greatest impact with the planned cuts to Jobseeker.

“There are far more economic risks to reducing JobSeeker now than there are to maintaining the rate.

“We’re calling on the Government to extend the existing Coronavirus Supplement to prevent income cuts in two weeks and move quickly to legislate a permanent, adequate JobSeeker rate. It’s not just the right thing to do, it’s also the smart thing to do for the economy,” said Ms Di Natale.


Read the Deloitte report here