Centrelink falls short for essential living costs, report reveals

Anglicare Australia's annual cost-of-living index, released in June, has revealed that people living on Centrelink payments can’t afford the basic essentials to live.

The analysis compares incomes against essential living costs such as rent, food, and transport, drawing on data from the most recent Australian Bureau of Statistics Household Expenditure Survey data for WA, taking inflation into account.

Data specific to Western Australia showed that a family of four with two parents on Centrelink payments are left with just $82 a week for all other expenses including medical, clothing and education costs. A single parent on the parenting payment has just $78 left, or $11 per day. 

A single person on JobSeeker in a share house has $165 left after essential weekly expenses, or $23 per day for other costs. With income falling behind costs by $130 a week and increasing rental costs, it would be difficult for them to move out of shared accommodation. The largest cohort of people on the JobSeeker payment are over the age of 45, who may find it difficult to access and live in shared accommodation.

“Centrelink payments simply do not cover the costs of essentials. That means people are being forced to skip meals, avoid medical care, and cram their families into overcrowded homes. Some are being pushed into debt spirals just to keep up with everyday costs,” Anglicare WA CEO Mark Glasson said.

^{Anglicare WA CEO Mark Glasson.}

Housing is the biggest living cost facing households, with average rents rising by more than 50 per cent since 2020.

“Inadequate income support is the key cause of poverty in Australia and it’s unacceptable for a government to leave its most vulnerable citizens unable to cover the basics of food, housing and medicine,” he said.

Anglicare WA has for years been calling on the Government to raise the rate of Centrelink payments above the poverty line. “These payments have been too low for too long, trapping people in poverty instead of helping them escape it,” Mr Glasson said.

“Only an increase to the base rate of Centrelink payments can really help people doing it the toughest.”

Food insecurity

Foodbank WA also supports calls for a rise in Centrelink payments to help lift people out of poverty. 

The CPI for food and non-alcoholic beverages increased 3.8 per cent at the end of the quarter in March 2024 compared to the previous year, according to the Australian Bureau of Statistics.

"With the CPI increase they are getting less food for their money. Unfortunately, food is seen as a discretionary spend against fixed costs of housing, utilities, and other bills," Foodbank WA CEO Kate O'Hara said. 

The Bankwest Spends Trends report also highlighted a 28 per cent decline in the volume of transactions at food stores and warehouses in March 2024 compared to the previous year.

^{The Foodbank Hunger Report showed that 388,000 Western Australians experienced moderate to severe food insecurity last year.}

The average value of transactions for the same period remained stable indicating the cost of food was taking up the same amount of Western Australians’ household budgets, despite buying less.

The 2023 Foodbank Hunger Report showed that 388,000 Western Australians experienced moderate to severe food insecurity last year and 85 per cent cited cost of living as the main cause of the food insecurity. 

"One in two Australians have felt anxious about accessing adequate food. In a country where we produce enough food to feed our population three times over, this should not be happening," Ms O'Hara said.

More than half (60 per cent) of all food insecure households had someone in paid work. Almost all (94 per cent) food insecure households mitigated cost-of-living pressures by reducing food and grocery spend. 

Households experiencing food insecurity for the first time are more likely to be younger (70 per cent aged under 45), employed (83 per cent) or with mid- (80 per cent) to higher (85 per cent) annual gross household incomes.