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Northern Territory Council of Social Service
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Submission: Inquiry into the Social Services Legislation Amendment (Strengthening Income Support) Bill 2021

The Northern Territory Council of Social Service (NTCOSS) is the peak body for the Northern Territory (NT) Community and Social Services Sector and is a voice for people affected by social and economic disadvantage and inequality. The Community Sector in the NT is made up of community managed, non- government, not-for-profit organisations that work in social and community service delivery, sector development and advocacy. The Community Sector plays a vital role in creating social wellbeing for all Territorians and in building safe and healthy communities by providing services that enable people to access and participate in health services, education, employment, economic development, and family and community life.

All people and communities should live a life free of poverty and disadvantage. NTCOSS advocates for the relieving of cost of living pressures, such as reform to income support and welfare systems, in partnership with our members.

NTCOSS represents a broad service sector and acknowledges that a number of our member organisations with specific expertise in this area actively advocate in this space. In particular, NTCOSS supports submissions by our Aboriginal Community-Controlled member organisations (ACCOs).

NTCOSS endorses the submission and recommendations put forward to this inquiry by the Australian Council of Social Service (ACOSS).

NTCOSS welcomes the opportunity to provide a submission to the inquiry into the Social Services Legislation Amendment (Strengthening Income Support) Bill 2021 (the Bill). This submission reaffirms the position NTCOSS has previously taken in preceding submissions to the inquiry into the Social Services and Other Legislation Amendment (Extension of Coronavirus Support) Bill 2020 (Attachment A) and to the inquiry into the Adequacy of Newstart and related payments and alternative mechanisms to determine the level of income support payments in Australia 2019 (Attachment B).

In summary, the key recommendations put forward in previous NTCOSS submissions were as follows;

  • the rate of JobSeeker and other income support payments is inadequate and needs to be urgently increased on a permanent basis;
  • the success of the Coronavirus Supplement in keeping recipients out of poverty demonstrates the necessity of an ongoing permanent rate of income support that is higher than the current base rate;
  • Aboriginal people living in remote communities should be able to access income support without having to meet more onerous conditions than those that are applied in urban centres; and
  • the Community Development Program should be abolished and the Fair Work and Stronger Communities Proposal1 should be adopted.

Disappointingly, the Bill does not include a sufficient, permanent increase to the base rates of JobSeeker and related payments, and meaningful reforms to address the inadequacies in our social security system have not been undertaken. The Federal Government has instead focused on delivering more restrictive and punitive measures (for example, the establishment of a hotline for employers to report those who decline employment offers), that will overwhelmingly and adversely impact Territorians.

In its findings, the Poverty in Australia Report 2020 concluded that the single rate of Youth Allowance was $168 per week below the poverty line, while the single rate of JobSeeker was $117 per week below the poverty line, with no real permanent increase in the base rate of the JobSeeker payment in 25 years.2 While the Bill marks a permanent increase of $50 a fortnight ($3.60 a day) to the base rate of the JobSeeker payment, this increase is not enough to make a notable difference to people’s standard of living and is not in line with advice previously provided by community sector organisations and institutes such as NTCOSS,ACOSS and the Reserve Bank of Australia.

  1. Fair Work and Stronger Communities Proposal, APONT, 2017 accessed at https://www.clc.org.au/files/pdf/Proposal-for-Remote- Development-and-Employment-Scheme.pdf
  2. Australian Council of Social Service (ACOSS) and the University of NSW Sydney (UNSW Sydney), Poverty in Australia 2020, Part 1:Overview, Strawberry Hills NSW

The primary purpose of Australia’s social security system is to provide individuals with a ‘minimum adequate standard of living’.3 This includes adequate food, water and housing and the continuous improvement of living conditions.4 Ensuring the adequacy of social security payments to assist individuals in meeting this standard is of crucial importance in supporting those experiencing poverty and disadvantage in our communities. The introduction of the Coronavirus Supplement allowed recipients for the first time in many years to be able to meet this basic, adequate standard of living.

In line with the Raise the Rate for Good Campaign, NTCOSS recommends that JobSeeker and related payments need to be permanently increased by at least $25 a day (which would bring the JobSeeker rate to $65 a day), to enable people to live above the poverty line. The Government’s proposed increase of $3.60 a day is woefully inadequate and will keep people far below the poverty line, especially when combined with the impact of the cessation of the Coronavirus Supplement.

NTCOSS notes that of the poverty rates in Australia, people living in Remote or Very Remote localities experience much higher levels of poverty than those living in urban centres.5 These high rates of poverty are experienced disproportionately across the NT, with Aboriginal people in particular overrepresented in homelessness and unemployment rates, and poor educational outcomes.

The impact of the lack of any significant increase to base rates of income support payments on people residing in remote Territory communities is identified in NTCOSS Cost of Living reports. Residents of remote areas are unfairly burdened by high costs relatingto transport6 and increased rental costs7; prices have increased in key expenditure areas (such as utilities, education and health) and those living in the regions (and in particular in remote localities) pay substantially higher rates for produce and other food items.8 As a result, vulnerable people face further challenges with damaging effects on health, social wellbeing and long term security, and poverty and disadvantage are becoming further entrenched in our communities.

Deloitte Access Economics has established that every dollar that the Government invests in JobSeeker generates significant economic return, with analysis showing that the Government’s reductions to income support would set the economy back in a time of recession.9

  1. Australian Government, Australian Law Reform Commission, 2012 ‘Australia’s social security system’, September 2019, https://www.alrc.gov.au/publication/grey-areas-age-barriers-to-work-in-commonwealth-laws-dp-78/5-social-security/australias-social- security- system/
  2. Australian Government – Attorney-General’s Department, ‘Right to an adequate standard of living, including food, water and housing’ viewed

September 2019 https://www.ag.gov.au/RightsAndProtections/HumanRights/Human-rights- scrutiny/PublicSectorGuidanceSheets/Pages/Righttoanadequatestandardoflivingincludingfoodwaterandhousing.aspx

  1. Parliament of Australia, The impact of COVID-19 on JobSeeker Payment recipient numbers by electorate, September 2020, viewed November 2020, available at https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/rp2021/COVID- 19JobSeekerRecipientNumbersElectorateUpdate#_Toc49850898
  2. NTCOSS, 2018 Cost of Living Report – Issue 21 7 NTCOSS, 2019, Cost of Living Report – Issue 23 8 NTCOSS, 2019, Cost of Living Report – Issue 24
  3. NTCOSS, Media Release: Cuts to JobSeeker to cost the NT economy $348 million – Deloitte report, September 2020, available at https://ntcoss.org.au/category/media-releases/

Along with the measurable economic benefits that come with higher payment rates of social security, increasing the rate of payments would have positive impacts in numerous other areas. Poverty and financial pressure directly correlate to poor health outcomes and the reduced ability to engage and participate in employment. Health (and in particular mental health) can be improved by reducing the burden of engaging with Government.10 Despite this, and despite having one of the strictest income support compliance systems amongst comparable countries, the Government has announced increased Mutual Obligations for JobSeeker recipients including an increase in job searches from the current 8, to 20 by July 1 2021.11

These latest changes to Mutual Obligations are unnecessarily punitive and will create further hardship for recipients without improving their job prospects. Punitive measures like these, in line with programs such as the Community Development Program, do not address larger structural issues such as the deficit of jobs in the NT, especially in remote communities, nor do they help to develop the labour market. In January 2021, there were 23,508 people on JobSeeker and Youth Allowance in the NT12, and only 2000 jobs advertised.13 Such statistics indicate that there is a larger structural issue at play, which will not be rectified by punishing JobSeeker recipients if they do not increase the number of job searches they are undertaking.

Along with increased Mutual Obligations, the Bill outlines the intent to establish a hotline to enable employers and Employment Services Providers to report JobSeeker recipients who decline job offers. The evidence presented for this hotline at the relevant press conference was anecdotal and14 any potentially productive outcome of this hotline is unclear. A blanket approach to this issue has potential complications (for example a job may appear appropriate on paper but may have exploitative conditions, or an employer who behaves inappropriately, and these are valid reasons to decline a job offer). As such, without further evidence this hotline appears to be unnecessarily punitive and without adequate justification. Punitive measures like this have the potential to actively cause harm to vulnerable people. Instead, the Government should focus on developing productive programs which create jobs for people in rural and remote areas such as the Fair Work and Stronger Communities Proposal.

NTCOSS does not support the Bill, and instead recommends that the rate of JobSeeker, Youth Allowance and other related payments be increased permanently and adequately as recommended by ACOSS through the Raise the Rate for Good Campaign, by a minimum of $25 per day. Additionally, in relation to the NT, NTCOSS recommends that the Government remove punitive measures that unfairly impact and stigmatise cohorts within the Territory (as referred to in the submission to the inquiry into the Adequacy of Newstart and related payments and alternative mechanisms to determine the level of income support payments in Australia 2019) (Attachment B). NTCOSS also recommends that the Government reconsider unnecessarily punitive measures such as the proposed hotline and instead focus on investing in programs that benefit communities and address rates of unemployment in a meaningful way (such as through the abolishment of the CDP and adoption of the Fair Work and Stronger Communities Proposal).

  1. NTCOSS, Media Release: Cuts to JobSeeker to cost the NT economy $348 million – Deloitte report, September 2020, available at https://ntcoss.org.au/category/media-releases/
  2. ACOSS, Media Release, “A heartless betrayal of millions – Government JobSeeker decision“, 23 February 2021, Strawberry Hills NSW
  3. Australian Government, Department of Social Services, ‘JobSeeker Payment and Youth Allowance recipients – monthly profile’, January 2021, available at https://data.gov.au/data/dataset/jobseeker-payment-and-youth-allowance-recipients-monthly- profile#:~:text=The%20%E2%80%9CJobSeeker%20Payment%20and%20Youth,and%20Youth%20Allowance%20(other).&text=The%20report%20includes%20payment%20recipient,and%20Statistical%20Area%20Level%202.
  1. Australian Government, Vacancy Report: Labour Market Information Portal, January 2021, available at https://lmip.gov.au/default.aspx?LMIP/GainInsights/VacancyReport
  2. Prime Minister of Australia, Press Conference Transcript, 23 February 2021, Canberra, ACT

To view this submission in PDF form, including it’s attachments, please click here