New report shows three million Australians living in poverty

Analysis by the Australian Council of Social Service (ACOSS) and UNSW Sydney shows national poverty rates remain high despite Australia experiencing decades of uninterrupted economic growth.

The Poverty in Australia 2018 Report, launched by ACOSS CEO Dr Cassandra Goldie at the National Press Club today to coincide with Anti-Poverty Week, finds there are just over 3 million people (13.2%) living below the relative poverty line, including 739,000 children (17.3%). In Australia, the poverty line is defined as a single adult living on less than $433 a week, or $909 for a couple with two children.  The report finds:

• One in eight adults and more than one in six children are living in poverty.
• Many of those affected are living in deep poverty, on average, a staggering $135 per week below the poverty line.
• Unsurprisingly, those experiencing poverty at the highest rates are those unable to get paid work, relying on Government allowances – Youth Allowance and Newstart.

ACOSS Chief Executive Officer Dr Cassandra Goldie said: “The evidence released today shows that through social security, housing and employment policies, as a nation we choose the level of poverty we are prepared to accept.

“The Government argues that poverty in Australia is not the problem. They are wrong. People on the lowest incomes cannot afford to pay for the very basics of life – housing, food, energy, health and getting their teeth fixed.  Poverty is now a consistent feature of Australian life. Are we prepared to accept this?

“The solutions to tackling poverty are clear. We must lift the adequacy of our social security safety net for those most acutely affected – people living on Youth Allowance and Newstart, boost family payments for the lowest income families and index these payments to wages. A serious boost to social and affordable housing is long overdue, as well as an adequate increase to Commonwealth Rent Assistance. A complete overhaul of employment services, and a commitment to full employment is essential, as is a guarantee of at least 2 days of early childhood education and care for every child, regardless of their background.

“Australia is one of the wealthiest countries in the world. With strong signs in the economy, and an improved Federal budget position, the top priority for any Prime Minister must be to end poverty in all its forms, not deliver another round of tax cuts.

“It is time that our politicians stopped talking about themselves and turned their attention to the issues that the community cares about,” Dr Goldie said.

UNSW Professor Peter Saunders, lead researcher, said: “The Australian Government has joined other nations in adopting the Sustainable Development Goals, a framework for national and global development. These Goals include reducing by half poverty rates for men, women and children by 2030, but we are a long way from achieving them. Australia lacks a poverty reduction plan and we do not have regular monitoring and reporting by governments on progress to address poverty.

“This report seeks, in part, to fill that data gap and our hope is that, informed by this research, action to reduce poverty becomes a national priority for governments, business and the community,” Professor Saunders said.

For a copy of the report please click here:  2018 Poverty in Australia

Snapshot of poverty in Australia

1. In 2015-16:

• The poverty line (50% of median income, before housing costs) for a single adult is $433 a week. For a couple with two children, it is $909 a week.
• 3.05 million people (13.2% of the population – more than one in eight) – are estimated to live below the poverty line, after taking account of their housing costs.
• 739,000 children under the age of 15 (17.3% of all children – more than one in six) and 410,000 youth between the ages of 15 and 24 (13.9%) live below the poverty line.
• The average ‘poverty gap’ (the difference between the incomes of people in poverty and the poverty line) is $135 per week.
• 53% of people below the poverty line are in households that rely on social security as their main source of income, while 38% rely on wages as their main income.
• 26% of people in households whose reference person receives an income support payment are living below the poverty line, including 64% of those on Youth Allowance, 55% of those receiving Newstart Allowance, 52% of those on a Parenting Payment, 36% of those on the Disability Support Pension, 17% of those on a Carer Payment, and 12% of those on the Age Pension.
• A major source of child poverty is the high poverty rate (32%) among sole parent families, who must generally rely on a single income.
• The majority (52%) of people below the poverty line were in rental housing, while 15% of people in poverty were home-owners without a mortgage.
• Australia has the 14th highest poverty rate among 34 OECD countries, and is part of a group of English speaking wealthy nations with above-average poverty levels.

1. From 1999-00 to 2015-16:

• The proportion of people in poverty fluctuated within a band between 11.5% and 14.1% from 1999 to 2015.
• Child poverty moved within a higher band between 14.3% and 18.6%.
• Poverty among people in households relying mainly on the Age Pension was 15% after the $32 a week pension increase in 2009, well below its 19% rate in in 2005.
• The freezing of the Newstart Allowance (which has not increased above inflation since 1994) has increased poverty among those receiving that payment. Poverty among people in households relying mainly on Newstart Allowance rose from 61% in 1999 to 78% in 2015, while the average poverty gap (for households reliant on Newstart Allowance below the poverty line) rose from $81 per week to $136 per week over the same period.
• The transfer of 80,000 sole parents to Newstart Allowance in 2013 was associated with an increase in the rate of poverty among unemployed sole parents from 35% in 2013 to 59% two years later.