Poor People Cutting Back on Essentials

Low-income households and people on welfare benefits are being forced to cut back on essential items including food, utilities and medical treatment, according to a new report.

The South Australian Council of Social Service (SACOSS) released its latest Cost of Living Report on Thursday, which surveyed more than 500 low-income households across Australia.

“Over half of the people in the survey cut back on groceries and meal preparation,” SACOSS CEO Ross Womersley told Pro Bono Australia News.

“A third limited their use of electricity and gas and water. Forty per cent said that they were much less mobile than they wanted to be. And a third of respondents had actually cut back or stopped their medical treatment.

“Indeed another third had also cut back… on telecommunications and had cut back on insurance.

“So what the survey really showed is that people who are in receipt of income support payments are finding that getting by is much more difficult, and they are… engaged in having to cut back in really fundamental areas of expense in order to continue to survive.”

He said the results went against the misconception that people on low incomes don’t properly manage their finances. He said welfare payments were simply too low.

“Historically many people who are on low incomes are stereotyped as being poor managers,” Womersley said.

“We’ve always believed that in the main, people in receipt of welfare payments are good managers of their money.

“We’re also in a circumstance at the moment where the federal government has plans to make major cuts to a number of social security payments that are currently on the table.

“And so this Cost of Living Report… actually went to examine how much pressure were people on income support payments faced with, and what were they doing to manage in those circumstances.

“Categorically what the survey concluded was that, in fact, people were very actively trying to manage quite difficult circumstances because their payments were inadequate.”

He said SACOSS was calling on the government to not only reverse the planned cuts, but also increase payments.

“This has consistently been supported by economists from both the right and the left, and indeed a range of business leaders, along with those of us in the COSS network, led in large part by our colleagues at ACOSS, that the base-level payments are set at an inadequate level at the moment,” he said.

“Indeed we’ve argued for a long time that payments like Newstart should be increased by a minimum of $53 a week immediately in an effort to help people survive in these circumstances.

“Now this survey and the findings from it really underline why that’s such an important thing to do, and why at the same time it’s so important that the government not proceed with the raft of social security cuts that are still on the table.”

Womersley also said there were significant long-term effects of low-income households sacrificing living essentials.

“The cost of that for us as a community is in the long term. Those experiences will potentially leave people sicker, more isolated and more vulnerable over the long term,” he said.

“And that in turn will mean that we will have to pay more as a community when they end up in our tertiary health system or end up in other places in the system unable to be supported.”