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Budget wait for JobSeeker boost, but supplement likely for new year

“If further support is needed past December, then clearly we are open to that,” Senator Ruston told The Sydney Morning Herald and The Age.

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“We have seen this coronavirus pandemic has thrown so many curve balls at us, not the least being the Victorian situation causing massive damage to the Victorian jobs market and to individuals and the community.

“We remain alive to the situation as it unfolds. We don’t know when this situation is going to end and we don’t know what it’s going to look like when it ends.

“We are going to remain vigilant on the temporary conditions that exist and we’ll respond to them as we go.”

About 1.4 million people receive JobSeeker and another 170,000 receive a form of Youth Allowance, which is effectively an unemployment benefit for those aged under 22.

The government increased benefits with a coronavirus supplement worth $550 a fortnight in April but it will cut this rate to $250 from next month, sparking warnings from the Australian Council of Social Service about the hardship imposed on families.

Government sources said it was highly likely the coronavirus supplement would continue beyond January 1 despite a plan unveiled in July to halt the temporary benefit at the end of this year.

Senator Ruston said it was too soon to decide whether the supplement would stay at its current rate, given the uncertainty about the jobs market.

“It is very likely temporary measures will remain in place from January 1,” she said.

“The rate would be determined on the economic analysis of the situation as we get closer to that date.”

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The age pension boost in the budget could be a one-off payment or ongoing increase, with Senator Ruston declining to say how the additional help would be structured.

Labor has accused the government of a pension “freeze”: the regular indexation of the pension, due to go ahead this Sunday, will not produce an increase because it is linked to inflation, which has fallen below zero.

“Further support around our pensions is something that is contained in the budget,” Senator Ruston said.

While community and business groups hoped for a JobSeeker decision in the budget, the Prime Minister did not put a timeframe on the move when saying earlier this month he would “lean heavily forward” to continuing support after January 1.

Prime Minister Scott Morrison, pictured with Treasurer Josh Frydenberg, has not put a time frame on the JobSeeker decision.

Prime Minister Scott Morrison, pictured with Treasurer Josh Frydenberg, has not put a time frame on the JobSeeker decision.Credit:Alex Ellinghausen

“We will make further decisions about JobSeeker closer to the end of the year or potentially even in the budget,” Mr Morrison said on July 21.

Senator Ruston said it was “not a matter of a delay” because the budget aimed to respond to a volatile situation rather than set the long-term rate.

ACOSS chief executive Cassandra Goldie has called for a rapid decision on a permanent increase to the JobSeeker rate, while also citing research from Deloitte Access Economics about a hit to the economy from the imminent cut to the supplement.

“Reducing the coronavirus supplement would harm the economic recovery and decrease both [gross domestic product] and employment across Australia,” Deloitte said in the report released on Tuesday.

Business Council of Australia chief Jennifer Westacott has proposed an increase in the JobSeeker base rate from $565.70 to at least $708 a fortnight along with a $10 billion business tax incentive to create jobs.

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Labor leader Anthony Albanese has attacked the government for cutting the coronavirus supplement and has called for a higher JobSeeker rate, while Greens leader Adam Bandt wants the permanent rate set about $1100 a fortnight.

Asked about the hardship and uncertainty for Australians who would have to wait for the government decision, Senator Ruston said the government had to see how conditions changed.

“Clearly the fundamental part of that is watching what happens in the jobs market and making sure we have the right incentives in place,” she said in an interview.

“We only have to see what happened in Victoria over the last couple of months to realise how terribly volatile the jobs market is, so we want to make sure our responses are timely and targeted.”

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