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Will welfare changes push young people into poverty?

The government says there are adequate safety nets, but Labor has warned young people could be made homeless by changes to Newstart. With Liberal MP Wyatt Roy, and Labor MP Amanda Rishworth.

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More than half a million young people could need emergency assistance - including food packages - as a direct result of an Abbott government change which welfare groups have warned will lead to ''catastrophe''.

In an admission that a mandatory six-month wait for benefits for those under 30 is likely to push hundreds of thousands of people into crisis, officials have told Senate hearings the government had allocated $230 million over four years to provide emergency relief to those affected.

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The government expects 550,000 applications for assistance, which will be delivered by charities in the form of food vouchers, transport or medications, household goods, clothing or by helping to pay rent or utility bills. Department of Social Services deputy secretary Serena Wilson admitted in a Senate hearing on Wednesday there was a risk that some affected by the change would become homeless.

Brotherhood of St Laurence head Tony Nicholson described the policy as "draconian''. "It will be a catastrophe for those people and also for the welfare agencies that will have to pick up the pieces," he said.

Emma King, chief executive of the Victorian Council of Social Service, said young people in Melbourne's growth corridors were already camping near welfare agencies to access basic aid, such as food and clothing.

"When we factor in people having no income for half the year and the idea of a safety net is to put more money into emergency relief … it's just so extraordinarily removed from reality it defies comprehension," she said. "These people are being pushed into poverty and they've got nothing."

Anglicare Victoria chief executive Paul McDonald said it would demoralise job seekers, who would face a ''hand to mouth'' existence.

"People are not going to get themselves out of poverty with emergency relief handouts," he said.

Maree O'Halloran, president of the National Welfare Rights Network, said youth unemployment would not be addressed by forcing young people into destitution. ''The $230 million to be spent on emergency relief for those left with no safety net would be better spent providing 100,000 job seekers with wage subsidy programs for four years,'' she said.

The change will also apply to parents if they are not the primary carer for their children. A household in which both parents receive income support would lose $490 a fortnight as a result of the change.

Some exemptions are available, including for people who do not have the full capacity to work, who are studying or training or who have a disability.

Ms Wilson told the hearing that separate changes to Family Tax Benefit B would result in 700,000 single income and single parent families losing the benefit.

Asked if any families would be better off as a result of the range of budget changes to benefits and payments, Ms Wilson said she knew of no one.

Greens senator Rachel Siewert said the plan showed the government knew the change would place people in ''extreme financial hardship''.

''They know people are going to be living in poverty, and their answer to that is go and beg from charity,'' she said.

Officials also revealed some young jobseekers would face multiple waiting periods and be forced to wait up to 11 months to qualify for benefits.

Jenny Macklin, Labor's spokeswoman on families and payments, said: ''This confirms that Tony Abbott's budget will hit Australian families hard. Labor will oppose Tony Abbott's attack on low- and middle-income families.''

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