Increasing the jobseeker rate should take priority over other welfare reforms including allowing aged pensioners to work more without having their payments reduced, peak unemployment bodies say.
A private member’s bill introduced by independent MP Rebekha Sharkie on Monday would increase the income test threshold for pensioners, permitting older Australians to work more hours before their payments were docked.
Sharkie argues getting seniors back to work could be key to alleviating major workforce shortages, including in the farming and manufacturing sectors.
But Edwina MacDonald, the chief executive of the Australian Council of Social Services, said while she supported measures to help more Australians access paid work, the “vast majority” of people facing substantial barriers to getting a job were under pension age.
Under current rules, pensioners can earn up to $480 a fortnight without reducing their pension payment. Pensioners who earn more than that are placed on a part-pension and have their payments docked $0.50 for every dollar earned above $480.
People who receive jobseeker payments can only earn up to $150 a fortnight before their payment is tapered by 50 cents for every dollar, rising to 60 cents for every dollar if they earn more than $256 a fortnight.
MacDonald said lifting jobseeker payments to at least $70 a day was the priority. Labor has not committed to the increase.
The full aged pension is $987.60 a fortnight; jobseeker is $642 a fortnight.
“There are more than 430,000 people aged 45 to 67 on the $46-a-day JobSeeker payment,” MacDonald said.
“Most in this cohort are women. Lifting income support would help people looking for paid work retrain, reskill and put their best foot forward when applying for jobs.”
Jessica, who asked to go by her first name, told Guardian Australia she often goes “months” without receiving any money from Centrelink because she has surpassed the income threshold.
The 21-year-old Sydney woman said surviving on the meagre payments while trying to keep her minimal savings was almost impossible.
“It’s nowhere near enough to live on, so obviously you’re going to try to work as well,” she said.
Antipoverty Centre spokesperson Kristin O’Connell said rolling out changes for pensioners without doing the same for people receiving jobseeker payments was “completely around the wrong way”.
“Such a high proportion of people on jobseeker payments either do have a job or are disabled or are facing discrimination because of their age,” she said.
“Nobody begrudges pensioners making more money but these payments should be enough for people to live on without having to work.
“People fortunate enough to get paid work should be able to live a bit more comfortably. Instead, we have a system that applies punishment to do so.”
Current rules allow people on jobseeker to earn $75 a week without getting their payments reduced – the equivalent of one three-hour shift, capped at $25 an hour.
The national minimum wage is $21.38 an hour, plus a 25% casual loading for casual employees.
“You cannot legally work without your payment being affected if you’re casually employed,” O’Connell said.
“It’s extraordinary. Nobody is choosing to try and survive on these payments, yet you lose 50 to 60% of the dollar you work.
Greens social and government services spokesperson, Janet Rice, said the party was in favour of increasing access to work for all income support payments, including the aged pension.
Advocacy group EveryAGE Counts said providing a financial incentive for older Australians to enter the workforce would be ineffective if it wasn’t accompanied by efforts to mitigate employer ageism.
“Around half of Australian businesses say they’re reluctant to recruit workers over a certain age – and for most of that group the certain age is over 50,” campaign director Marlene Krasovitsky said.
“If you’re 65 in a job interview, your chances of getting a fair go are relatively slim … if we really want to encourage older Australians who want to contribute back into the workforce, we need to make sure they’re competing on a level playing field.”
The federal government has indicated it will consider Sharkie’s proposal at the upcoming jobs and skills summit.
