The federal government is preparing to roll back one of former prime minister Julia Gillard’s most controversial policies by allowing single parents to stay at home for four more years without being moved to JobSeeker.
As part of next month’s budget, cabinet is considering raising how old a youngest child can be to 12 before their parent is kicked off the payment, according to sources familiar with the deliberations. This is four years less than the return to the 16-year-old threshold called for by the government’s own economic equality taskforce last week.
Sources who could not speak on the record due to the nature of the negotiations said the government was being urged to consider allowing single parents to stay on the payment until their youngest child was at least 14.
Independent parliamentary budget office costing conducted for MP Zoe Daniel shows it will cost the government roughly $640 million over the next three years to cover parents until their children are 12, or $1.1 billion until their children reach 16.
A decision announced by Gillard on the day of her now famous misogyny speech in 2012 cut back the amount of assistance paid to single parents, forcing them onto lower benefits when their children reached the age of eight instead of the previous cut-off age of 16.
The decision dogged Labor for years and has been blamed by a range of experts for an increase in child poverty rates.
At the time, it was projected to save the government about $700 million over four years, but it reduced single parents’ incomes by about $100 a week.
Nearly a quarter of a million parents – mostly women – receive the single-parenting payments.
The single-parent payment is $949.30 a fortnight. On top of the payment, a parent of two children can earn up to $227.20 before their payment starts to be reduced.
Terese Edwards, chief executive of the National Council of Single Mothers, has sent a raft of emails to the government begging them to reinstate the cut-off to 16, not 12.
“Twelve would be a complete disaster for us,” she said. “We’re fighting so hard to have something that should have never been taken away.”
Edwards said many women earn as much as they can on the parenting payment, often collecting just $10 a fortnight on top of their wages. The point, she said, was having that safety net to fall back on should they lose their job.
The decision to cut back access to the payments has haunted Labor, and in 2013, then-leadership hopeful Anthony Albanese conceded that “sole parent payments is an area where we made a mistake”. Newly confirmed as prime minister last year, he backed the principle of “no one left behind”.
Daniel said she was concerned that the government may only move the cut-off another four years.
“This is one of the most difficult transition phases in a child’s life,” Daniel said.
Daniel said the May budget was the time for Albanese to improve the lives of women living in poverty, in line with one of the six recommendations from the Women’s Economic Equality Taskforce (WEET) helmed by Sam Mostyn.
“The government says it cannot do everything it would like, but by cherry-picking the recommendations of the WEET, it is ignoring that their suggestions are about investment in our future prosperity,” she said.
Mostyn could not comment on the negotiations but was hopeful of a full reinstatement of the 16-year-old cut-off, as it was also about the children’s welfare.
“It would be a shame if the government were not able to reach the full reinstatement as we know that children under 14 are in a major transition going into high school,” she said.
“There is a huge benefit to ensuring that the transition goes well and that the children avoid any of the complications of living in poverty, which is what would occur if that payment cut out.”
Australian Council of Social Services chief executive Cassandra Goldie agreed that keeping households on the single parenting payment until their youngest was 16 was important, but it would not affect as many people as increasing the JobSeeker payment.
“While this measure should be implemented, it would, at best, only help about 85,000 single parents of the over 1 million people who are destitute on JobSeeker and Youth Allowance. If the government only lifts the youngest child age to 12, it would be even fewer who benefit,” she said.
When asked directly about the cut-off age on Sunday, Finance Minister Katy Gallagher said the government was taking inequality issues seriously ahead of the budget.
“We are looking at the recommendations and you’ll see some of those outcomes in the budget,” she said on ABC’s .
“We want to ensure that within the environment we’re in, where we’ve got a range of pressures coming at us, and those pressures are increasing over the longer term, not decreasing, that we’re doing what we can to address women’s equality but also address disadvantage and poverty where we can.”
A spokesman for Treasurer Jim Chalmers said the government takes all suggestions it receives seriously.
“We work through them in a methodical way and any measures will be clear on budget night,” he said.
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