There Are Pros And Cons In Abbott's Plan To Tackle Youth Unemployment

Photo: Mission Australia

As part of a plan to find savings, in what has been declared a “budget emergency”, the Abbott government will make some big changes to the country’s welfare reform, starting with a change to the eligibility age of the Newstart Allowance.

According to The Australian, the government hopes increasing the age of eligibility for unemployment payments from 22 to 25 will force young people to “earn or learn” and get training for “real jobs”.

Expected to be introduced in January next year, it will see youth on these payments bumped down to Youth Allowance, cutting their cheque from $510 to $414 a fortnight.

It is hoped the change will combat the rising number of youth living on welfare payments as youth unemployment continues to increase.

March figures reveal the number of Newstart recipients has grown 7.5% over the previous 12 months, from 682,120 to 733,601, and the number of Youth Allowance recipients rose 6.8% from 106,244 to 113,456.

But Maree O’Halloran, from the National Welfare Rights Network told The Australian it will simply put more pressure on parents.

“The parental means test for Youth Allowance hits families with incomes over $48,000. The reality is many parents will struggle to support adult children financially, the result being hardship all round,” she said.

But it’s not all bad news.

As of July 1 this year, Abbott will also introduce a $2500 incentive for 18-30 year-olds on government payments if they get a job and remain off benefits for 12 months, and a further $4000 if they are employed for two years.

Read more here.

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