JobSeeker saved 155,000 Australians from the brink of homelessness. Now that lifeline is being slashed.

Homelessness could again rise in Australia as support measures are removed. (Speed Media, Icon Sportswire via Getty Images)
  • More than 155,000 Australians were saved from extreme rental stress due to increased government support during the pandemic, according to a newly published report by the Productivity Commission.
  • Support organisation Homelessness Australia said it was more evidence the federal government should keep elevated JobSeeker payments.
  • Mission Australian meanwhile called for greater investment into public housing to both prevent homelessness from rising and stimulate the economy.
  • Visit Business Insider Australia’s homepage for more stories.

A big-spending Morrison government has prevented vulnerable Australians from becoming homeless through the pandemics – but now it’s preparing to remove the guardrails.

On Wednesday, a new report released by the Productivity Commission reveals that increased government support helped ease extreme ease rent stress on Australian households from being out on the street.

“People need an adequate income to afford rent and have enough left over for food and other expenses. When the Government effectively doubled JobSeeker in 2020, more than 155,000 households who had previously been in rent stress were able to afford their rent,” Homelessness Australia chair Jenny Smith said.

“For those in severe rent stress – spending more than half their income on rent – the increased JobSeeker rate was a lifeline.”

JobSeeker payments roughly doubled during the pandemic, after the Coalition had for years refused to raise the rate of the unemployment benefit.

The enormous income increase unsurprisingly slashed the proportion of Australians struggling to pay their rent. In June, there were 75,000 fewer Australians paying more than half their pay check to their landlord. There were 11.1% fewer Australians spending more than a third of their income on housing.

With the pandemic pushing the economy into recession, and sending more Australians into unemployment, the safety net became essential.

“Rental stress is a huge contributor to homelessness because it strains people’s budgets so much that a small shock can mean they can’t keep up with rent. Reducing rent stress also saved those households from falling off the cliff edge of homelessness,” Smith said.

The report should serve as a warning then, Smith says, as the Morrison government returns JobSeeker payments to the original Newstart level of $565.70 for individuals, and $510.80 for partners per fortnight.

““The next round of scheduled cuts to JobSeeker at the end of March… will push hundreds of thousands of people, who were given a temporary reprieve during the pandemic, to the brink of homelessness,” Smith said.

Mission Australia executive Ben Carblis echoed the analysis, urging the government to commit to providing sufficient housing.

“Australia’s housing system remains in urgent need of repair and investment. With the severe shortage of social and affordable homes, too many people simply can’t find a safe, secure and affordable home,” he said. “Investment in building, upgrading and improving social and affordable housing will support economic recovery, improve social and economic outcomes for people on lower incomes, and will help Australia take great strides in helping to end homelessness.”

“As an immediate economic stimulus measure, the Government should prioritise investing in building 30,000 new social homes over a four-year period under the Social Housing Acceleration and Renovation Program (SHARP) proposal.”

Various groups have long lobbied for such investment, with Opposition Leader Anthony Albanese criticising the government for opting for its HomeBuilder scheme, which subsidised new construction and renovations, instead.

‘Snap back’ to reality

By virtue of the desperate attempt to contain it, the pandemic put the budget surplus obsession of the Coalition on ice in March.

The party that had cemented itself to a platform of fiscal responsibility virtually overnight became the architects of the biggest budget blowout since World War II.

The change of strategy curiously flipped the political dynamic, with Labor suddenly warning of a $1 trillion deficit, and generational taxes, urging the government reign in measures.

However, as government looks to soon unveil its May budget, Treasurer Josh Frydenberg is continually reminding Australians the support measures were only ever intended as temporary.

The Prime Minister for his part introduced such measures referencing a ‘snap back’ to previous policy once the pandemic was dealt with.

“There is a snap back there, a snap back to the previous existing arrangements on the other side of this. And so there is an intensity of of expenditure during this period. And then we have to get back to what it was like before,” Morrison told media in April.

While the benefit of such support measures have long been clear, including as economic stimulus, the government has been careful to plan the country’s path back to fiscal prudence.

Even if its means the poorest Australians bear the cost.