Poverty, hunger, and homelessness are rising across Australia. The biggest increase in living expenses in more than 20 years and the highest inflation in three decades mean thousands are struggling to put food on the table and pay bills. Even the nation’s capital is not immune, as a recent ACT hearing, part of the Senate’s inquiry into the extent and nature of poverty in Australia, revealed.
“Too often, the ACT is thought of as an affluent seat of government, and not a place where there are people living below the poverty line or living paycheque to paycheque,” Independent ACT Senator David Pocock, who organised the hearing, said.
But according to the ACT Council of Social Service (ACTCOSS), nine per cent of Canberrans live in poverty: an estimated 38,300 people, including 9,000 children.
“The testimony we heard at the committee hearing was that the cost-of-living crisis is pushing even more people below the poverty line,” Senator Pocock said.
“As a wealthy country, there’s no excuse for letting families live in poverty.”
Canberra’s ‘working poor’
While the ACT has the highest average weekly earnings in the country, ACTCOSS testified, “the incredibly high cost of living in Canberra means that many households cannot afford the fundamentals of a healthy life such as housing, food, transport, health services and energy”.
Over the last five years, ACTCOSS’s 2022 Cost of Living report states, meat and seafood prices have increased by 16 per cent; housing by 19 per cent; automotive fuel by 35 per cent; electricity by 28 per cent; gas by 24 per cent; medical and hospital services by 21 per cent; and education by 17 per cent.
The Consumer Price Index (measuring the changes in the price of a fixed basket of goods and services) recorded its biggest annual rise (9.3 per cent) since 1987, the Australian Bureau of Statistics reported in January, while employee households recorded the largest rise in the Living Cost Index (the price change of goods and services and its effect on living expenses) since 2000. Australia’s inflation rate rose 7.8 per cent last year – the biggest increase since 1990.
- Canberrans on low incomes hit hardest by cost of living rises: ACTCOSS (6 May 2022)
- Canberra an especially hard place to be poor: Anti-Poverty Week report (18 October 2022)
That has led to what Mohammed Ali, ACT Citizen of the Year and founder of food charity HelpingACT, calls a ‘working poor’ class.
Many in paid employment are struggling or facing poverty, YWCA Canberra agrees: “The high median income and cost of living mean the buffer between comfort and poverty is small.”
More people in full-time work are seeking assistance from community sector services and programs, ACTCOSS acting CEO, Dr Gemma Killen, said.
Community sector organisations, in fact, report unprecedented demand. Appeals to HelpingACT for food assistance have more than doubled in recent months, and increase every week, Mr Ali said.
Similarly, YWCA Canberra report a more than 50 per cent increase in demand for their food pantry since February 2022. Once, their typical client was an older woman on the Age or Disability Support Pension; now, many are young fathers in regular employment.
“This is a ‘canary in the coal mine’ moment,” YWCA Canberra advised. “Things are now particularly dire, as this is a cohort that would typically be most hesitant to ask for help.”
Government must increase social security payments
Community organisations and (non-government) politicians alike insist that federal financial assistance payments must be higher to lift people above the poverty line.
“Allowances paid to vulnerable people do not match increased demands,” Mr Ali said. “They cannot maintain a decent, dignified lifestyle in Canberra, which is a basic human right.”
“Without a significant increase to our income support system … the poverty crisis will continue to spiral, and the situation for many Canberrans will get worse,” Dr Killen said.
Poverty is linked to Australia’s welfare net, YWCA Canberra stated, and Australia’s income supports and age pensions are among the lowest in the OECD.
In September, the Labor government increased JobSeeker Payment (single) by $25.70 a fortnight to $677.20, Parenting Payment (single) by $35.20 a fortnight to $927.40, and partnered JobSeeker and Parenting Payments by $23.40 a fortnight to $616.60. (These include Energy and Pension Supplements.)
- Governments respond to community sector’s poverty plea (21 October 2022)
But the community sector states that these payments are still below the poverty line, and wants the federal government to raise the rate of income support.
The most recent Henderson poverty line (September quarter 2022), published by the Melbourne Institute, is $1,146.88 per week for a family comprising two adults (one working) and two dependent children.
Senator Pocock is adamant that the rate of JobSeeker be raised, “so that people aren’t struggling to eat or pay their rent while they’re between jobs”.
ACTCOSS wants income support raised to at least $73 per day, while Johnathan Davis MLA and other Greens believe income support payments must be increased to at least $88 per day. In their view, poverty is a political choice – as the pandemic welfare payments showed.
When the JobKeeper Payment and Coronavirus Supplement of $550 were introduced in 2020, the ACT’s poverty rate dropped from 8.6 to 5.2 per cent, ACTCOSS noted – and increased to 9.0 per cent when those supplements were phased out in 2021. (Across Australia, the Sydney Morning Herald reported, poverty fell from nearly 12 per cent to below 10 per cent, then rose to 14 per cent.)
“We saw poverty decrease substantially,” YWCA Canberra said. “People were able to buy medicine, pay rent, and keep the lights on. When the supplement was eventually removed, poverty re-emerged. It isn’t coincidental that an increase in income resulted in less poverty.”
“That was a choice – a terrible choice,” Mr Davis said. “The federal government made the decision to reduce these payments, knowing this would plunge tens of thousands of Australians back into poverty. … This choice has seen more people than ever before seeking support from the overworked and overstretched community sector…”
YWCA Canberra believes there must be a conversation around welfare reform at the federal level: not only the rate of pay, but punitive reforms to mutual obligation requirements and other policies.
ACTCOSS also called for the federal and ACT governments to ensure funding for the community sector matched increased demand.
Housing
Housing affordability is increasingly difficult, Mr Ali said: many families are on the verge of homelessness, or living below the poverty line.
The ACT has been the most unaffordable city to rent for people on low incomes for at least two years. According to ACTCOSS, the ACT has the highest number (61.3 per cent) of low-income private renters in financial stress (spending more than a third of gross household income on housing).
The November Rental Affordability Index showed that the average Canberra renter spends a quarter of their income on rent; renters earning less than $106,000 per year are in housing stress if they rent a freestanding home; and more than half of Canberrans are priced out of the private rental market altogether.
The ACT government announced last month it would re-establish the Rent Relief Fund to help low-income households experiencing rental stress or severe financial hardship in the private rental sector.
- New housing office shows Barr’s lost trust in ministers: Canberra Liberals (3 February)
- Canberran renters still pay the most expensive rent in the country (11 January 2023)
- Low-income ACT renters struggle needing 117% of income to pay rent (29 November 2022)
- Canberra remains most expensive capital city to rent (1 February 2022)
- Canberra least affordable city for low-income renters (26 November 2021)
- Rental affordability is Canberra’s real housing crisis (10 November 2021)
- Housing crisis: Canberra is Australia’s most expensive city to rent (25 January 2021)
ACTCOSS estimates the ACT has a shortfall of 3,100 social housing properties, and needs 8,500 additional dwellings by 2036.
YWCA Canberra estimates this even more is needed, given the population undercount in the 2021 census.
“As our population continues to grow, and the economic divide between comfort and crisis grows in Canberra, we are going to need greater investment in social housing.”
- ACT will be 7,100 dwellings short of housing target, MBA warns (14 February)
- ACT to lose 93 affordable rentals in 2023 (10 January)
Currently, 3,169 applicants are on Housing ACT’s waiting list. Those who need priority housing wait nearly a year (324 days, or 10.7 months); those on the high needs housing list wait more than three years (1,150 days, or 37.8 months); and those on the standard housing list wait nearly six years (1,793 days, or 59 months).
“People are doing full grocery shops at pantries and living in cars or pitching tents at the Cotter while they wait for years for a social housing option to open up,” Senator Pocock said.
The ACT government intends to add another 400 public housing dwellings by 2025 and renew another 1,000 properties, while the federal government has set a target under the National Housing Accord of one million new homes across Australia. However, Master Builders ACT predict the ACT will fall more than 7,000 dwellings short of its Accord target; while the ACT will lose 93 affordable rental properties this year, when the National Rental Affordability Scheme (NRAS) ends in 2026.
“We need a housing policy and corresponding investment that will actually provide the number of dwellings we need each year to meet the growing demand,” Senator Pocock said. “This is a live issue in the parliament, and I plan to keep pushing for an ambition from the government that actually meets the needs of our city and the needs of our country more broadly.”
Mr Ali argues that a concerted, low-cost housing project (e.g., a multi-storey complex) will help with the accommodation crisis.
ACTCOSS believes the government must increase the rate of Commonwealth Rent Assistance by 50 per cent, and thereafter index it to the increases in private rental. The Department of Social Services said last year that the government expects to spend around $5 billion on Commonwealth Rent Assistance in 2022-23, to help around 1.4 million households receiving income support with the cost of private rental or community housing.
Long-term homelessness is on the rise in the ACT, according to the recent Report on Government Services, but Canberra community organisations and the ACT government are worried that the Commonwealth will cut funding for homelessness services by $65.5 million nationwide – an estimated $2 million in the ACT – from July, when funding arrangements (including supplementation funding to cover increased wage costs) under the National Housing and Homelessness Agreement expire.
The government says it intends to extend the NHAA, while it transitions to a new housing agenda, but agencies fear the NHHA will be ‘rolled over’ without the supplementation payment.
“Recently, we’ve seen the government choose not to extend $65 million of funding for frontline homelessness services at the same time these services are busier than ever,” Senator Pocock said. “I’ll keep pushing them to change their mind on this.”
- Homelessness rises in ACT while social housing dwindles (27 January)
- ACT community sector calls for no cuts to homeless services funding (22 February)
Food security
More than one in 10 Canberrans cannot afford food, Mr Ali said.
“Food is a basic human need,” he said. “It is the right of all citizens.”
The problem is nationwide. Across Australia, just over half (55 per cent) of households are highly food secure, able to access adequate food without any problems. More than two million households (21 per cent) experienced severe food insecurity in the last year, skipping meals or going days without eating because there is no money for food, according to the Foodbank Hunger Report 2022; 64 per cent blamed higher living expenses for food and housing.
- Cost of living crunch forces Aussie households to go hungry (22 February)
- People helping people: the team feeding Canberra’s hungry in 2023 (30 January)
Mr Ali said there is more demand in the community than is met; many people who need assistance do not come forward for help. CALD communities (including refugees and asylum seekers), for instance, may not have good enough English or confidence. People who suffer food insecurity may have other complex problems (housing stress, poor health, mental illness), but approaches to managing these problems are often piecemeal. Students are also vulnerable to food insecurity, affecting their educational performance.
“Kids are our future, and parents must not be in a situation [where their financial hardship compromises their growth],” he said.
In his view, the governmentshouldinitiate special spot grants for food relief, or discretionary funds charities can execute for the next year. A government-run relief network and a Canberra food bank would also ease pressure.
Currently, Mr Ali said, food is transported from Foodbank in Sydney to food pantries here; if the ACT government, or a charity under its auspices, ran a foodbank here, that would cut freight expenses. Some food pantries cannot pay transportation fees.
HelpingACT provides breakfast once a week in three schools; he would like to extend this with ACT government support. The government has planned for two and a half years to trial a free breakfast and lunch program at five public schools.
The charity also provides halal meat and other staple foods to CALD communities through Companion House, Community Service #1, and directly to families – but Mr Ali says he desperately needs regular government funding to continue this.
Mr Ali wishes to start an education program to nip mental health problems and homelessness in the bud, especially for the CALD community. However, he said, HelpingACT is financially constrained, and needs regular funding for log-term planning to help those in need.
In fact, while HelpingACT has grown over the last five years to fill gaps in service delivery from governments and charities, Mr Ali said, it is inadequately resourced: it relies on the goodwill of dedicated volunteers. While the ACT Government has provided some grants (for which Mr Ali is grateful), he seeks regular funding from the Federal and ACT Governments.
The charity faces serious problems in storing and transporting food, Mr Ali said. The ACT Government has provided a room in the Theo Notaras Multicultural Centre, but Mr Ali says he needs more space there, and a truck to transport food. At the moment, there is only one truck, which is not enough for their monthly homeless barbecues in Civic or for transporting bulk purchases.
“No-one should sleep hungry in Canberra,” Mr Ali said. “We are an affluent city, and [with funding] we can achieve this dream easier than big cities.”
Mr Ali’s Forum Australia will host a panel discussion about the cost of living on Tuesday, 21 March, 6pm, at Taj Agra, Dickson. Speakers include Dr Sharon Bessell, ANU; Dr Gemma Killen, ACTCOSS; Professor Ben Phillips, ANU; and Rebecca Vassarotti MLA. Tickets $10 – $20. Purchase online.
ACT Government inquiry into cost of living
Johnathan Davis MLA is heading an ACT Government committee on cost of living pressures in the ACT, consulting experts, stakeholders, and the community on policies to help low and moderate income Canberra households. He attended the Senate hearing.
“Hearing the stories of Canberrans struggling to keep a roof over their head and food on their table inspired me to lead this important committee with compassion and kindness,” Mr Davis said.
“We shouldn’t see people buying their medication on afterpay. Yet this was one example of the evidence I heard at the Senate hearing. We should all agree that is an unacceptable situation for anyone to be in in a country as rich as Australia, and a city as rich as Canberra.
“While so many of the drivers of poverty – rising interest rates, inflation, and income support payments below the Henderson poverty line – sit outside the ACT Government’s influence, there are many things the ACT Government could do.”
He encouraged every single Canberran with an idea on how the ACT Government can reduce the cost of living to make a submission to the inquiry.
Submissions need not be detailed; emailing an idea is enough for the committee to ask questions and make recommendations to the government, he said.
A message from YWCA Canberra
“While we need to meet growing demand for our services, ultimately what we should be aiming for is a society where poverty, food insecurity, and homelessness are eliminated.
“Some people with complex needs may always need support from social welfare organisations like the YWCA Canberra, but if you’re just going through a hard time – maybe following a divorce, or an illness, or you lost your job, or your rental lease ended – you shouldn’t be left to survive against the odds because there isn’t enough affordable and social housing and income support is so meagre.
“Australia is a rich country both socially and economically. Services like welfare and community pantries should exist to help people get out of poverty, not keep them in cycles of deprivation.”
