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Controversial plan to boost Centrelink to $88 A DAY

·Personal Finance Editor
·2-min read
Australian currency fanned out. Australians line up outside the Centrelink offices.
Centrelink payments would be boosted to match the Henderson poverty line. (Source: Getty)

More than 5 million Australians would see their Centrelink payments increase to $88 a day under a new plan unveiled by the Greens.

The minor party announced if it held the balance of power after the federal election it would raise all federal government income supports to $88 a day to get them above the Henderson poverty line.

The new payment would equate to more than $32,000 a year, with indexation tied to the poverty line.

The plan, dubbed the ‘livable income guarantee’, would cost around $89 billion over the forward estimates. The Greens said it would be covered by taxes on large corporations and billionaires.

"In a wealthy country like ours, no one should live in poverty," Greens leader Adam Bandt said.

"By making billionaires and big corporations pay their fair share of tax, we can lift people out of poverty while also lifting wages and boosting our economy."

Mutual obligation requirements would also be abolished and measures such as the parental income and asset test would be scrapped for those not living at home.

"To cut costs, the Liberals have made many of these payments hard to get, while blaming people for failing to find jobs that just aren't there," Bandt said.

"Anyone who has been on Centrelink can tell you the system is broken: it's underfunded, it's built on systems of humiliation and cruelty, and it traps people in cycles of poverty as bills pile up and urgent needs go unmet."

Centrelink staff would also increase by 5,000 to help implement the plan.

Controversial plan

However, not everyone agrees the plan will be sustainable, with the Parliamentary Budget Office (PBO) questioning the effect the plan could have.

"In extending the income-eligibility threshold, it is likely that some potential recipients near the income cut-off point may choose to either reduce their work hours or not undertake additional working hours that they otherwise would have," the PBO said in its costing letter to the Greens.

"The extent of this effect is highly uncertain and therefore has not been included in the estimated financial implications of this proposal."

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