Stories in philanthropy

Philanthropy backs calls to Raise the Rate

Three million Australians live in poverty, and more than 730,000 are children. As the 2019 federal election campaign draws near a growing number of philanthropic funders are supporting the Raise the Rate campaign, advocating for policy change that has the potential to lift thousands of Australians out of poverty.

Nicole Richards, December 2018

How well do you remember 1994? It was the year Nelson Mandela became President of South Africa and Netscape Navigator launched to become the world’s dominant web browser. Here in Australia, Paul Keating was Prime Minister, phone numbers started transitioning to eight digits, Christopher Skase began his fight against extradition from Majorca and a litre of petrol cost 66 cents.

A lot has changed in the intervening 24 years, but one thing that hasn’t is the Newstart Allowance rate. Newstart, the Australian Government’s primary income support payment for unemployed jobseekers, hasn’t increased in real terms since 1994.

A 2017 study by UNSW estimated today’s cost of living for basics such as housing, food transport, health, energy and clothing for a single person in Australia is a minimum of $433 per week.

The current Newstart rate for a single Australian is $273 per week. That’s $170 lower per week than the Aged Pension.

ACOSS (Australian Council of Social Service) CEO, Cassandra Goldie, says more than half of Newstart recipients live below the poverty line. Raising the rate, she says, is “the single most effective step to reducing poverty.”

“It is very difficult to look for a job when you don’t know where your next meal is coming from or how to put food on the table for your kids,” Goldie says.

Raise the Rate seeks to raise the Newstart Allowance by $75 per week and a growing number of Australian philanthropic funders are putting their support behind the campaign.

 

Collective effort

Paul Madden, Chief Executive of The Wyatt Trust and convenor of the growing group of Raise the Rate’s philanthropic supporters, says the Newstart rate is an issue philanthropy can’t afford to ignore.

“Australia’s Newstart allowance is the lowest unemployment payment in the OECD,” Madden says.

“At Wyatt, we’re in a somewhat unique situation in that we grant to individuals and we see the impact of Newstart, all day, every day.”

“About 40 per cent of the applications we receive are on behalf of people who are on the Newstart allowance. Very often these people are spending up to 70 per cent of their income on housing.

“When you come from a base of just $278 per week, these people are being locked into poverty for very long periods of time. It’s a kind of entrapment.”

In September, Madden approached Philanthropy Australia’s Policy and Research Manager, Sarah Wickham, to gauge the interest of other Philanthropy Australia members, which spurred a number of conversations and connections.

“We wanted to see if we could help grow the movement to get change on this particular issue,” Madden explains.

“You can’t sit there providing grants to help people in their impoverished circumstances if you’re not going to do anything to address the systems that put them there. You can’t give help by way of a palliative.”

“For philanthropy, we need to look at how we can actually influence outcomes that lead to people having better lives.

“By getting others on board, we are building a constituency of people who’ve looked at this issue and care about it.”

Working towards a target of $1 million from Australian philanthropy to support the Raise the Rate campaign, funds raised will be used to help build public support for change ahead of the looming 2019 federal election.

One of the first foundations to join the coalition supporting the campaign was The Myer Foundation. CEO Leonard Vary says The Myer Foundation “agrees with ACOSS and many others that raising the rate of Newstart by $75 per week will make a fundamental and positive difference in the lives of more than one million people in Australia.

“It’s important that philanthropy supports the community organisations providing direct relief for people struggling to meet everyday needs through foodbanks and community meals, emergency relief and help with bills, school, rent and transport costs,” Vary continues.

“It’s even more important that philanthropy seeks to contribute to changing the conditions that lead to the high demand for that direct relief. In this case changing the conditions means raising the rate – simple, really.”

It's a sentiment shared by Reichstein Foundation Executive Officer, John Spierings.

"Raising the rate of Newstart is not only a matter of justice after such a long period of stagnation, it is also perhaps the most direct and efficient way of assisting Australian move out of poverty," Spierings says. "Raising the Rate is overdue, it’s prudent and it’s affordable."

The $75 increase is supported by economic modelling by UNSW and Deloitte Access Economics.

ACOSS CEO Cassandra Goldie says the support from philanthropy “gives us a much better chance to lift one million people out of abject poverty within the next 12 months.”

“Systems change of this magnitude - a minimum $75 per week increase in the single rate of Newstart Allowance after 24 years of stagnation - requires a major campaign and significant investment,” Goldie says. 

“The support for this that ACOSS is getting from philanthropic organisations gives us our best shot in twenty years to secure this increase through both houses of parliament as a top priority for the nation. It will also help build public understanding of who we are as a country, and what we need to do to ensure every person, every child has enough food to eat and a safe roof over their head.”

 

Philanthropy takes a stand

The Raise the Rate campaign is the latest in a string of public campaigns and policy change efforts that have attracted significant support from Australian philanthropy.

In September this year, the Victorian Home Stretch campaign helped secure a commitment from the Victorian Government to increase the age of out-of-home care from 18 to 21. Previously, more than 50 per cent of young people leaving care at 18 experienced homelessness and/or unemployment, were caught up in the criminal justice system or became a new parent in their first year out of care.

Other examples of successful advocacy include philanthropy’s support of Woor-Dungin’s Criminal Record Discrimination Project and the national Marriage Equality campaign, both of which were recognised at the 2018 Australian Philanthropy Awards.

Advocating for positive social change is a role philanthropic funders are increasingly embracing. Paul Madden believes philanthropy’s support of the Raise the Rate campaign has the potential to contribute to policy change that will improve outcomes for generations of Australians.

“It’s not right that people are trapped on a very low income for long periods of time,” he says. “Even worse than their impoverishment is the fact that they are robbed of hope.

“This is an issue for all of us who care about people being able to live with some modicum of dignity.”

 

 

For more information about being part of the coalition of philanthropic supporters of the Raise the Rate campaign, contact Paul Madden at The Wyatt Trust.

Funders - Are you interested in this Co-Funding Opportunity? You can get involved here. 

Learn more about the Raise the Rate campaign.

 

RELATED:

The next evolution: The Myer Foundation’s journey to refresh its strategic plan

Nation’s most effective givers recognised at 2018 Australian Philanthropy Awards

People powered justice: The Grata Fund

Stories in philanthropy

More stories