The welfare system should be radically overhauled to replace all working-age payments and pensions with a single basic payment that would cover "life's essentials," according to the country's peak welfare group.
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In its submission to the federal government's McClure welfare review, the Australian Council of Social Service argues that welfare payments should be based on people's financial needs and not on assessments about their potential to do paid work.
It recommends that payments for people of working age should be based on two components: a basic income support payment for all recipients and add-ons for extra needs such as disability, caring, rental assistance and single parenting. This model is similar to the "Universal Credit" payment which was launched in Britain last year to replace six working-age benefits.
ACOSS says a single payment would fix the "unfair" split between lower allowance payments and higher pension payments, addressing the current $255.50 difference between the dole and the disability support pension per fortnight for single people. The welfare body also argues that the current welfare system is based on an out-of-date idea that people who are able to work should get lower welfare payments because they will only need short-term income support.
ACOSS chief executive Cassandra Goldie said the social security system was ''complex, unfair and undermines employment participation". "The system is broken and tinkering at the margins won't fix it," she said. "People with the same financial needs receive vastly different payments."
The ACOSS recommendation for a common base payment mirrors the findings of a review Patrick McClure did for the Howard government almost 15 years ago. This was later developed by Tony Abbott when he was employment minister but not adopted.
ACOSS is also calling on the government to set up an independent commission to benchmark income support payments to broader community living standards.
But while ACOSS is leaving the new payment levels up to the future expert panel, it has renewed its call on the government to increase Newstart by $50 a week ''to reduce the most severe poverty''.
It is also calling for a $48 a week boost in student payments for those over 24 and an increase in rent assistance for those paying most.
When asked what he thought of the ACOSS proposal for a single common payment, a spokeswoman for Social Services Minister Kevin Andrews said the government welcomed the contributions of "all organisations and individuals that have participated in the welfare reform consultation process".
She said the welfare review team, chaired by Mr McClure, had been conducting consultations for the past six weeks and would deliver its report to the government "for consideration" later this year.
Labor's acting spokeswoman for family payments Claire Moore said that Labor was "not against simplification of the payment system".
"But what we will not put up with is the Abbott government using a simplification agenda to try and mask their next round of savage cuts," Senator Moore said.
"We have seen this have devastating effects for vulnerable people in the UK."
