Never has a government taken so much cash from families in an election year. Promised increases to Family Tax Benefits are cut, the Baby Bonus has largely been axed and for low income families, there is little relief from government in this budget.
Single parents who have been campaigning against being moved to Newstart have been bitterly disappointed by the lack of response from government. A small improvement in the Newstart income taper is among a handful of small changes that will benefit a minority of the almost one million single parents in Australia.
That is not to say this budget is all bad news. Children will benefit from big spending initiatives in early childhood education and schools funding, and for the disabled, the National Disability Insurance Scheme is a life changing reform.
Doctor Cassandra Goldie, CEO of the Australian Council of Social Services (ACOSS) can't believe the government has not done more for the poorest families in Australia.
"While we welcome the modest easing of income rates for people on Newstart and other allowances, the Government has failed to assist the four-fifths of Allowance recipients who are unable to obtain paid work, said Cassandra.
"One in eight people, including one in six children, are living in poverty and an increase in the lowest social security payments would have the most immediate and direct impact in reducing it.
"We welcome the integrating of the baby bonus into the family payments system so that it is better targeted but remain concerned about reductions in payments for the poorest families."
Many of those poorest families are single parent households and two thirds of those parents are working so they will get a small benefit from the changes to the income test for Newstart.
From March 2014, single parents (and others) who are working part time and receiving Newstart (unemployment benefits) will be allowed to earn $100 a fortnight before their benefit starts to reduce. That is up from just $62 per fortnight now.
The government estimates this will add about $19 per fortnight to the incomes of those who benefit. That $100 income threshold will also be indexed in future so there will be yearly increases.
25,000 single parents who are moving onto Newstart from Parenting Payment Single (PPS) will benefit from the extension of the Pensioner Education Supplement and 2000 single parents who move from PPS but are not eligible for Newstart will keep their pensioner concession card for 12 weeks. Both these concessions will kick in next year.
Many advocates in the welfare lobby were hoping for a $50 rise in the base rate of Newstart in this budget and single parents were among them. They have been disappointed but are unlikely to get any relief from an Abbott Liberal government if elected in September.
The Liberals supported the government in moving single parents onto Newstart in January and John Howard's Liberal government implemented the original policy in July 2006.
Opposition Leader Tony Abbott has promised to scrap the School Kids Bonus, which is now over $800 per year for high school kids.
This budget was, in the eyes of many single mums, the last chance for some relief because Labor is unlikely to be re-elected on 14 September, if current polls can be believed.
"The Budget failed to restore hope and income to single parent families leaving them stranded with an uncertain and bleak future," said Terese Edwards, CEO of National Council of Single Mothers and their Children.
"Some families were just scraping by and had hung their hope on tonight`s budget, these families will just be devastated.
"They now receive an allowance (Newstart) which is $150 per week less than a pensioner and is stuck at 77 per cent below the poverty line," said Terese Edwards.
Terese acknowledges the increase in Newstart's income free area to $100 per fortnight but points out that if these families had remained on a parenting payment, rather than been forced to Newstart, they would be much better off.
"A mother with three children on a Parenting Payment could earn and retain $220 per fortnight - well above the increase of $100 per fortnight which will take effect in 2014."
Terese supports the extension of the Pensioner Education Supplement to all single parents on Newstart commencing in 2014 and the allowing single parents who are cut off from all income support when their youngest child turns 8 years, to keep their Pensioner Concession Card for 12 weeks.
Working parents will be hit by a slightly increased Medicare Levy, which will pay for part of the funding required for the National Disability Insurance Scheme.
A wage earner bringing home $30,000 per year will pay $150 per year extra from 2014-15 as a result of the Medicare levy rising from 1.5 per cent to 2 per cent.
People earning 25,000 per year will pay $71 per year extra, while those earning $50,000 per year will lose $250 per year extra in Medicare levy.
The government wants voters to look at the bright side of the budget especially the locked in long term funding increases in education.
"Our unprecedented investment in early childhood education, once in a generation school reforms, and additional higher education places will ensure our children have the education they need for the high skilled, high wage jobs of the future," said Wayne Swan.
"These reforms will provide more support in the classroom, more training for teachers and support for kids doing it tough. This investment will ensure every child has the opportunity to achieve their potential."
Wayne Swan and Prime Minister Julia Gillard are hoping that voters will support spending money on these big initiatives while understanding that their own financial belts must be tightened.
Many single parents have not been impressed, but as Terese Edwards says, are not confident about getting a better deal under an alternative government.
One single mum summed up the feelings of many in this post on Facebook this week:
"Please be careful where you vote come September. The opposition is saying that the cuts made by Labour are not enough ...
They are going to cut the school kids bonus and other education payments. Please vote with informed decisions ... I wish we had another option .... "
Business & Finance Journalist
Jason is a business and finance journalist with 20 years experience, and is also a member of the SingleMum.com.au Expert Opinion Panel. He has a regular weekly column in the Sunday Mail (Brisbane) and writes regularly for the Business Daily section of the Herald Sun in Melbourne and many other newspapers and magazines.
Jason's personal website is www.centrelinknews.com.au...read Jason Bryce's Profile here
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