Unemployment is about to become more painful after the government rejected a last-minute plea to stop a rule change due on April 1.
The end of March marks the end of a two-year loosening of the so-called liquid assets test that determines how much cash someone can have on hand an still get an immediate access to Newstart on losing a job.
For two years the limit has been $5000 for an individual and $10,000 for a family. On April first it gets busted back down to $2500 and $5000, where the Howard government put it in the infamous "black hole" horror Budget of 1997.
"The increase in the threshold was a temporary measure funded until March 31 to cushion Australians from the full effects of the global recession," said a spokesman for jobs minister Chris Evans.
"Under Labor’s strong management economic circumstances have since improved and the unemployment rate has declined."
An 11th-hour plea to government ministers from Brotherhood of St Laurence executive director Tony Nicholson seen by The Age says the change will mean that for many people unemployment will almost completely wipe out personal savings...
"There are obvious financial benefits to having some readily-accessible assets," the letter says. "Job seekers with some savings are better placed to pursue further education and training opportunities or to afford the driving lessons or a new suit for an interview that might open up opportunities."
The minister's hardline response, conveyed to The Age and not to the Brotherhood means the threshold will be set at a level judged appropriate during budget cutbacks 14 years ago without any adjustment for inflation in the decade and a half since.
The reversion to the earlier limit will also apply to recipients of the Youth Allowance, Austudy and Sickness Allowance, requiring them to run down savings or wait 13 weeks before receiving payments.
"Two years ago the government promised a review before reverting to the old rules, said National Welfare Rights Centre president Marie O'Halloran. "It is not clear that it has had one."
Published in today's Age
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