The Australian social services sector has called for the the dole to be increased in step with the minimum wage.
It comes after the Australian Labor Party described the current system as one which “simply isn’t fair”, and called for an increase to the current minimum wage.
In a submission to the Fair Work Commission’s annual minimum wage review, the Australian Council of Social Services (ACOSS) called on the commission to implement a “substantial increase” to the minimum wage and boost Newstart payments by $75 a week.
The current Newstart allowance for a single childless person is $275 a week.
The council said a boost to the minimum wage would reignite economic growth by putting more money into consumers’, and spenders’ pockets.
And while ACOSS said it’s appropriate to maintain a gap between between the base rate of working age social security payments and the minimum wage, the current gap is substantial and income support payments need to be “significantly increased”.
“The level of Allowances now sit well below well below the poverty line,” ACOSS said.
“Youth Allowance and Newstart need to be substantially increased to work properly – helping students to cover the essential costs of living, and ensuring people looking for paid work are not in financial crisis. The low rate of Newstart is acting as a major barrier to securing paid work.”
ACOSS also called for the minimum wage to be increased to lessen the gap between them and the median pay level.
“There is a greater need to do so because (in addition to wider concerns around poverty and living standards), Australia needs stronger wage growth to lift the economy from its present low-growth, low-inflation path.”
Make your money work with Yahoo Finance’s daily newsletter. Sign up here and stay on top of the latest money, property and tech news.