The Senate has defeated the government’s budget measure to make job seekers under 25 wait four weeks for income support.
Apart from Labor and the Greens, crossbenchers Jacqui Lambie, Nick Xenophon, Glenn Lazarus, Ricky Muir and Dio Wang voted against the legislation, which also had a number of other social security changes. It went down 35-30.
The young people’s waiting period was a watered down version of the 2014 budget attempt to make it six months.
In total, the changes that were proposed in the legislation involved savings of around A$1 billion over the budget period. The loss represents a setback for Social Services Minister Scott Morrison, whose negotiations failed.
The four-week waiting period for the under-25s would have saved $173.3 million over the forward estimates.
Other measures in the bill included a one-week waiting period for all working-age payments excluding the widow allowance; extension of the youth allowance from 22 to 24-year-olds in lieu of Newstart and sickness allowances; and indexation changes, but excluding pensions.
Asked in anticipation of the defeat about the youth waiting period, Morrison said the government remained “absolutely committed to the measures we have brought to the parliament on this issue.
"We do not believe that we should be sending a message to young people that it should be OK to go from the school gate to the Centrelink front door and that is why we are bringing these measures.”
Morrison said the Coalition was looking to the evidence from New Zealand “which showed that with the same measure, 40% of those young people who started that four-week waiting period did not end up on welfare”.
But Labor’s shadow minister for families Jenny Macklin said the defeat was a huge win for young people and for fairness.
“If Tony Abbott and Scott Morrison had got their way, young job seekers under 25 would have been left with nothing to live on for a month, pushing them into poverty and hardship,” Macklin said.
Macklin said the changes to the eligibility age for Newstart would have seen young jobseekers between the ages of 22 and 24 pushed onto the lower youth allowance – meaning a cut of about $48 a week.
Xenophon told the Senate he had “deep concerns about the practical impact of these changes at a time when unemployment is rising and some are even predicting Australia is heading for a contraction in our economy”.