Newstart allowance and the vanishing cost of living increase

Note: This has been amended from the version I originally posted on 29 March 2013.  There was an error in the original, making a bad story even worse.

In an earlier post I wrote about what I thought was an error in the way the Government’s new Clean Energy Supplement (CES) had been put in place.  My contention was (and still is) that as a result of a wrongly implemented income test change, the promised level of carbon pricing related compensation has not been delivered to some couples.
It subsequently occurred to me see whether the impact of this was so significant it compromised not just the overall level of compensation, but also the basic CPI increases that were implemented on 20 March.  It appears (fortunately) that this isn’t the case, although the implementation does seem to have eaten away much of the 1% cost of living adjustment.

Low-income couples and the carbon-compensation rip-off

No pictures in this post I'm afraid.  I'm not really sure how to draw a rip-off...

If the Government persists with the new rates and income test thresholds it announced on 2 March it looks to me like some couples are going to be getting $7.20 a fortnight less than they should, and less than they were led to believe in the Government’s Household Compensation information packages of a couple of years ago.  Affected couples are those where one partner is getting a social security benefit (eg, Newstart allowance or Austudy payment) and the other has a low income which prevents them from getting a benefit.

I don’t have access to stats detailed enough to say exactly how many couples are in this position, but if it’s in the order of 100,000, that amounts to almost $19 million a year that these couples are losing.