Australia's 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'', the peak welfare group argues.
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In its submission to the Abbott government's McClure welfare review, the Australian Council of Social Service says welfare payments should be based on people's financial needs and not on assessments about their potential to do paid work. It recommends 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, rent assistance and single parenting.
This model is similar to the ''Universal Credit'' payment launched in Britain last year to replace six working-age benefits.
ACOSS says a single payment will fix the ''unfair'' split between lower allowance payments and higher pension payments (there is currently a $255.50 difference between the dole and the disability support pension per fortnight for single people).
It also argues the current welfare system is based on an out-of-date idea that people who are able to work should get lower welfare payments because they will only need short-term income support.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 and those on the lowest payments such as Newstart Allowance receive as little as $35 a day."
As well as being similar to the new British model, 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 employment minister but never adopted by the former Coalition government.
But the recommendation stands in contrast to the view put forward by Mr McClure in his June interim report, where he suggested that Australia's myriad welfare payments be streamlined into four primary payment areas of disability, child payments, the age pension and a working age payment. The working age payment would have different "tiers" of payment to take account of individual circumstances, such as a partial capacity to work.
ACOSS also wants Newstart lifted by $50 a week ''to reduce the most severe poverty''.
