The Morrison government is slashing the coronavirus supplement to $250 a fortnight on Friday.
Single people with no dependents will be left with about $815 a fortnight or $58 a day.
Before the pandemic, JobSeeker (previously Newstart) paid about $550 a fortnight, or $40 a day – a level unchanged for years and which was long criticised as being below poverty level.
The coronavirus supplement for JobSeeker, introduced along with JobKeeper as an emergency measure when coronavirus restrictions shut down businesses nationwide and forced hundreds of thousands out of work, did not apply to aged or disability pensions or carer allowances.
Treasurer Josh Frydenberg said the new, reduced JobSeeker rate will last beyond December, when the supplement is set to be scrapped altogether, but the government is not saying what the final JobSeeker payment might be or whether it will return to the pre-pandemic rate.
“At the end of the year we’ll revisit the rate for the JobSeeker coronavirus supplement and we’re leaning in to provide continued support,” Frydenberg said on Thursday.
“We recognise that people are doing it tough. This money is really important to them,” he said.
“But we also know the best thing we can do to help people who are on JobSeeker is to get them into a job.”
Frydenberg said his October 6 federal budget would be squarely focused on getting people back to work.
“There will be no shortage of initiatives in the budget to help people to get off the JobSeeker payment and into a job,” he said.
Unemployment figures for August showed Australia’s unemployment rate at 6.8 per cent, down from a 22-year high of 7.5 per cent in July, but still well above the 5.1 per cent rate seen in February when the pandemic first hit.
But the government itself says that the effective unemployment rate is significantly higher, while Treasury estimates that up to 400,000 more people are expected to lose their jobs when JobKeeper payments are cut next week and businesses are forced to requalify for the scheme.
JobKeeper wage subsidies, introduced six months ago in the wake of widespread business closures due to strict coronavirus measures, are being cut in two steps from September 28.
The government says JobKeeper receipients who were anxious about their employment should check their eligibility for JobSeeker, and issued a reminder that anyone claiming unemployment benefits would first have to run most of their savings down.
The government is also reinstating JobSeeker mutual obligation rules which were relaxed for six months.
Labor argues now is not the right time to cut JobSeeker payments, saying boosting benefits had seen unemployed people living with some dignity for the first time.
“Now that money is going to be reduced dramatically at the end of this week,” opposition frontbencher Linda Burney said.
“It will mean people will go without food. It will mean the people will not be able to look after their children and get them to school as they’d like to.
“And quite often, the decision is between medication and eating.”
Burney also rejected claims from hotels associations that people are refusing work because the dole is too generous.
In places like Sydney and Melbourne, there are 12 people unemployed for every available job.
“I don’t know anyone that’s unemployed that does not want a job or doesn’t want more hours in the work that’s available,” she said.
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