A third of single mothers in financial hardship due to welfare policies, analysis finds

Under Centrelink rules, once a youngest child turns eight, parents are automatically moved from parenting to jobseeker payments. And Centrelink rules dictating how much people can earn before their payments are cut are also harsher for people on jobseeker, with Hamley calculating a $250-a-fortnight reduction to her income.

The longstanding federal government policy was one of several blamed for the high poverty rates among single-parent families. Analysis prepared for Anti-Poverty Week by University of Queensland researchers, released this week, shows the risk of financial hardship for single mothers is at least double that of partnered mothers.

About 34% of single mothers live in this hardship, according to the analysis of data from the household, income and labour dynamics in Australia survey.

The research points to several policy decisions that have led to a situation where, as an Australian Council of Social Service report found last week, one in eight Australian children live in poverty.

The value of jobseeker payments has also eroded because they are indexed differently to the age pension. The single rate of jobseeker (then Newstart) was worth 92% of the age pension in 2002, compared with about 66% today with supplementary payments included, the researchers said.

Other crucial policy decisions were the failure to invest in social housing, a reduction in spending on family tax benefit payments and a dysfunctional child support system that has led to an estimated $2bn in owed debts.

The analysis noted when the temporary coronavirus supplement was removed, the new rate of jobseeker fell to approximately 30% below the poverty line. It triggered a sharp rise in rental stress for those on Centrelink payments getting commonwealth rent assistance, from 29% in June 2020 to 63% at June 2022.

The only period in the past 10 years where the proportion of single mothers in financial hardship improved was when welfare benefits were doubled in 2020.

Since the double whammy of the end of the Covid supplements and her parenting payment, Hamley has put off getting her car serviced, seeing the dentist and other expensive medial appointments. She is doing everything she can to shield her kids from the changes.