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A better balanced welfare system

Australia’s welfare system provides support to those in need, but it must be sustainable to ensure that it meets the long-term needs of our society. The changes to the welfare system for working age Australians will address high levels of welfare dependency and will improve workforce participation.

Growing welfare dependency

Since 1974, the proportion of working age Australians receiving an income support payment has risen from a modest 5 per cent to around 20 per cent today. Around 2.6 million working age Australians currently receive some welfare payment.

Strong economic growth since 1996 has lowered unemployment — but has done little to slow the growth in single parents and people with disabilities on welfare.

The social impact of welfare dependency is high. Australia has a high proportion of people living in jobless families. Around 690,000 children live in households where no parent works.

Opportunity for change

Strong economic growth and the increasing desire for and availability of part-time work provide an opportunity to rebalance Australia’s welfare system so that it better meets the needs of the 21st century.

The outdated approach of people on welfare being expected to seek work only when they can work full time will be replaced. Policy will focus on encouraging self‑reliance and recognising the capacity of many recipients to work part-time. This approach recognises that the best form of income comes from a job, not welfare.

The proportion of total population living in jobless households is high by international standards

The proportion of total population living in jobless households is high by international standards

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2 2005-06 Budget