Excluding welfare recipients from getting a $75 energy payment originally meant for pensioners was a “deliberate decision” and not a mistake, the government says.
People on Newstart were initially excluded from the federal budget’s energy assistance package for other welfare recipients, which is worth $75 to singles and $125 for couples.
But the Morrison government has bowed to pressure and agreed to deliver the cash relief to five million welfare recipients and pensioners.
The plan is now expected to cost $365 million, an overnight blowout of $80 million.
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Finance Minister Mathias Cormann confirmed the original decision to exclude welfare recipients was not a mistake.
“No, we made a deliberate decision initially,” Senator Cormann told the ABC on Wednesday.
“(But) because we wanted this legislated before the end of this week, because we wanted pensioners in particular to have access to this cost of living pressure relief, we made a decision to adjust the measure.”
Treasurer Josh Frydenberg said Newstart recipients were originally excluded because most pocket other benefits or move off the payment in less than a year.
But late on Tuesday night, after delivering his budget, he and the prime minister changed their minds.
“We thought it was appropriate to extend it,” Mr Frydenberg told the National Press Club on Wednesday.
Shadow treasurer Chris Bowen said the backdown proved the budget had unravelled.
“The ink is not even dry,” he told reporters in Canberra.
“We said repeatedly that the energy supplement is a small compensation, but it should apply to those people, and the government shouldn’t have to be shamed into it by a resolution from the parliament to do so.”
The energy supplement legislation has passed parliament, making it the only part of Tuesday night’s budget to become law ahead of the May election.
Mr Frydenberg admitted the welfare backflip was a pragmatic choice because Labor was going to amend the legislation.
“We made this decision because we want this legislation to pass the house,” he told parliament.
Opposition Leader BIll Shorten said the electricity payments pointed to a deeper problem plaguing the Morrison government, arguing the one-off “con” was designed to conceal a lack of climate policy.
Announcing the pre-election enticement at the weekend, the government argued the unemployed would not benefit because it was limited to those “who don’t have the opportunity to work or earn additional income”.
People on Youth Allowance payments were also excluded.
Instead, it was targeted at aged and disability pensioners, carers, veterans and single parents – a position confirmed in Tuesday night’s budget papers.
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