Opinion & Commentary
Should single parents be forced onto the dole?
The Gillard Government's reforms to Parenting Payment eligibility are a big win for taxpayers, who will save more than $700 million over the next four years through reduced welfare payments.
But the bigger winners will be the families affected by the reforms.
The reform means about 100,000 parents of school-aged children will be taken off the $324 per week Parenting Payment on to the $266 per week Newstart Allowance.
These parents will have more incentives to move from welfare to work because their payments will be less generous.
The number of people on welfare will continue to fall because of these reforms.
But the benefits of moving from welfare to work have been lost on some in the welfare lobby.
They complain about the adequacy of Newstart Allowance and say some people on Newstart receive only a modest $35 a day to cover their costs.
However, not one parent affected by these reforms will receive $35 a day in welfare payments.
In fact, many will receive much more once additional welfare payments are taken into account.
For example, parents will also receive the following weekly payments: Family Tax Benefit Part A ($85); Family Tax Benefit B ($50); and Rent Assistance ($70).
Add other payments such as the Schoolkids Bonus, Telephone and Pharmaceutical Allowance, and the Clean Energy Supplement payments.
A single parent who has two children aged nine and 11 could take home more than $620 a week in welfare payments.
This works out to be worth nearly $90 a day -- and that's before taking into account the money they can earn from working.
Many of the children currently benefiting from Parenting Payment have grown up in welfare-dependent families, which increases the chance that they will be dependent on welfare when they grow up.
Moving from welfare to work is getting easier and welfare recipients are running out of excuses for not making the move.
For example, parents will get to keep a lot of their welfare payments if they get a job (like Family Tax Benefits).
Parents affected by reforms will get social and financial benefits that come from working, and their children will grow up in a family that gets income from working not welfare.
This will help reduce the risk of another generation becoming welfare-dependent.
The Government's reforms to Parenting Payment are good for parents, good for their children and good for taxpayers.
It's one of the rare cases of a public policy win, win, win.
Andrew Baker is a policy analyst at The Centre for Independent Studies.
