On 1st January 2013 the Federal Government’s Fair Work Incentives Bill came into effect. This moved all single parent families whose youngest child was eight off a modest payment known as the Parenting Payment Single (PPS) and mostly onto the lower payment of Newstart.
Overnight, 64,422 families that were already battling the cost of living had their income cut by a minimum of $60 per week. For mums who were in paid work, the financial loss was even greater. Many mums did not understand the impact and most were informed by a phone call from Centrelink in November and December 2012. No time to plan, no money for Christmas or for pending school needs.
The announcement came at the same time as the Australian Council of Social Service(ACOSS) revealed that 2.2 million people, including 575,000 children (17.3%) were living below the poverty line in Australia.
ACOSS’ Poverty in Australia Report found that 37% of people in households whose main income was social security were living below the poverty line. Among these 52% were on Newstart Allowance, and 45% on Parenting Payment.
The numbers …
On 1st Jan 2013 the Parenting Payment Single (PPS) was $321 a week. Newstart was just $279 a staggering 77% below the poverty line. 60% of single parents who were moved onto Newstart were already working, with most working in part-time and casual jobs trying to meet the parenting and cost pressures of raising a family.
Under Newstart their family budgets are even more stretched because the rate of Newstart is reduced after they earn just $31 a week – that’s two hours at the minimum wage. Previously, a mother on PPS with three children could earn and retain $122 per week before their payments started being cut.
Struggling families will get a bit of relief when the amount they can earn before Newstart is reduced increases to $50 a week in March 2014. This is far too low and does not replace what was lost in 2013.
It is extremely difficult for a family on Newstart to work their way out of poverty.
Single parents unable to find work are struggling the most under these tough rules. For families that were already poor, this is a huge amount of money. Since the changes many have struggled to pay the rent, register a car, buy adequate food and keep their kids in after school activity like sports. Emergency relief organisations like the Salvation Army have reported an increase in single parents turning up in crisis, needing help. Proud mums could no longer protect their children from the harsh impacts of being poor.
Ending the PPS for parents once their youngest turned 8 was a process started by the Coalition Government in 2006. Unfortunately these changes have had unintentional negative consequences. We are not alone with our concerns, with a number of Senate Committees having voiced reservations. The Joint Parliamentary Human Rights Committee found that this policy places undue hardship on parents, and especially their children, and the United Nations raised issues about the changes.
Putting the break on study. Women have reported that Newstart has forced them to stop studying and their future plans for that job they hoped would end their perpetual struggle are now in tatters. The National Welfare Rights Network estimates that overall there are about 26,000 parents on the Pension Education Supplement.
Unpaid care. Many single parent families care for a child with a disability. On 1st Jan 2013 one in ten parents (6,895) provides daily care for a child or adult with a significant disability.
The situation facing some single parents is worse because they may not have support from family.
Parents also face time pressures and fatigue associated with parenting alone. These stresses are worse where parents have limited supports, the child has special needs, or mum is in poor health.
It has always being hard to flee or leave domestic violence but Newstart has made the struggle even harder. As one single mother impacted by the changes explained in an email to the National Council for Single Mothers and their Children, and submitted to the Parliamentary Joint Committee on Human Rights: ‘We have started a new life – crossed the country, no money, no job but we are safe. For the first time we are safe. Can not leave my children, can not explain why my eight year old daughter wets her pants and don’t want her to be bullied. He sexually assaulted her. Just starting to breath out loud and now this. We will need to move again because we won’t be able to afford the rent.’
Since 2001, the numbers of children living in poverty has increased by 15%.
It is no New Start for Families
Not all of the negative impacts of these changes have been financial.
Kids in single parent households are already doing it tough, with 24% living in poverty, Compared with 7.6% of those living with two parents.
We know that kids who grow up in disadvantaged households are more developmentally vulnerable than other Australian children; getting caught in cycles of socioeconomic disadvantage can rob them of a chance to succeed in life before they’ve barely even started.
Parents of these kids need a decent level of assistance to support them as they try to build a better life for their kids.
MYTH: The government says these changes will encourage single parents to work. Why don’t single mums just get a job?
If only it were that simple!
The truth. 67% of singe mothers whose youngest child is aged six to nine are employed and 74% of mothers whose youngest child is aged 10 to 14 are employed. The majority of single mums are in paid work; they battle the cost and availability of child care, scarces jobs often without leave, transport issues and raise their kids.
In fact these ‘reforms’ have created the most financial disadvantage for parents who are already in the paid workforce. On PPS a single parent with three children could earn $125 per week before their payment was reduced – on Newstart they can only earn $32 per week.
Single parents also face many challenges with finding suitable paid employment. Caring responsibilities reduce the windows of time available for employment (would you work a night shift if you had an 8 year old at home alone?) and there is a well-documented acute lack of child care and Out of School Hours Care for primary and middle school students.
There is no evidence that more sole parents are employed because of these policy changes.
In fact, all evidence suggests that pushing people further into poverty makes it even harder to find employment. No money for that bus ticket, no job ready clothes, no access to the internet.