Question 10: What happened to beneficiaries and their levels of support in the 1990s?

13 Jul

In 1991, National savagely cut the rates of all benefits, including the invalids and sickness benefits. The harshest cuts were for the unemployed.

The unemployment benefit was cut by 25% for young people, 20% for young sickness beneficiaries, and 17% for solo parents. They abolished the family benefit and made many workers ineligible for the unemployment benefit with a stand down period of up to a six months. The 1992 benefit cuts were worth approximately $1.3 billion – about the same size of each of the tax cuts handed out in 1996 and 1998. Unemployment benefits were stopped for 16 and 17 year-olds and the youth rate for 18 & 19 year-olds extended to the age of 25.

Benefits as a percentage of the average wage fell significantly after 1985.The single person unemployment benefit dropped from 42 to 30% of the average wage by 1996. National Super for a married couple went from 85% to 72%. A domestic purposes benefit for a parent with one child went from 80% to 53%. The benefit for an unemployed couple with two children went from 95 to 69% of the average wage. The real value of National Superannuation was cut by 40% when combined with the extension of the age of eligibility from 60 to 65 years between 1992 and 2001 (See Table 1).

(Part of a series of extracts from “Exposing Right Wing Lies” by Mike Treen, Unite National Director)

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