While job losses have led to spikes in worsening mental health during the COVID-19 pandemic, a new study has shown it's the financial loss associated that causes the most harm.
A longitudinal study from the Australian National University has revealed rates of clinical depression and anxiety were double the typical population levels during March 2020 when the country first entered its initial lockdown.
The study, which surveyed 1,300 Australians over a three-day period in late March, found while poor mental health levels were caused by a fear of infection by COVID-19, it was the potential loss of income that impacted those surveyed more.
The study's lead researcher, Dr Amy Dawel, believes this could worsen further after drops were made to the JobKeeper and Jobseeker payments in late September.
"We know from this study the changes to JobKeeper and Jobseeker could have a big impact on the nation's mental health," Dr Dawel said.
"Financial, social and work disruptions caused by the initial lockdown phase of the pandemic have significantly impaired our nation's mental health doubling rates of anxiety and depression.
"These findings provide clear evidence that minimising social and financial disruption during the pandemic should be a central goal of public health policy."
Changes to JobKeeper payments came into effect on September 28 and meant recipients were split into two categories depending on the hours worked before the scheme was introduced. For those working at least 20 hours a week, the $1,500 fortnightly payment was shaved to $1,200 while those working under 20 hours a week would now receive $750 per fortnight.
Those payments will face a further decrease to $1,000 and $650 respectively from January 4, 2021 until the extension period finishes on March 28, 2021.
It comes hot on the heels of the federal government's delayed budget reveal where Josh Frydenberg was expected to announce a major increase in mental health spending following the findings of the Productivity Commission's unpublished mental health report.
The 2019-20 federal budget allocated $82 billion for health spending but that increased to $87 billion after additional costs associated with the COVID-19 pandemic were added. Of that total, $737 million was allocated to mental health funding over the next seven years.