The Labor leader will be under pressure from his party to back words with action at its national conference in July

This article is more than 2 years old

This article is more than 2 years old

Bill Shorten will face a strong internal push at the ALP’s national conference in July to commit a Labor government to increasing the Newstart allowance in its first term.

Darcy Byrne, an ally of frontbencher Anthony Albanese and a delegate to the 2018 conference, says Newstart must increase because the unemployment payment hasn’t kept up with national living standards for more than a quarter of a century.

Byrne, who is also the mayor of Inner West council in Sydney, said the conference in July will adopt a national platform, and as a delegate representing Albanese’s seat of Grayndler, he would push to commit Labor to increasing Newstart.

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Shorten this week pledged to pursue a “root and branch” review of Australia’s welfare payments if he won the election, but he did not commit to raising it – leaving open the possibility his review could come to nothing.

He made the pledge after a leading economist called for Newstart to be increased by $50 a week.

A senior partner at Deloitte Access Economics and renowned budget conservative, Chris Richardson, called on the Turnbull government this week to boost Newstart in next week’s budget, saying it had become “embarrassingly inadequate” as a safety net for Australia’s poorest.

“If we had to nominate the single standout fairness failure in Australia in 2018, it is undoubtedly our embarrassingly inadequate unemployment benefits,” Richardson wrote this week.

“We should add $50 a week to these payments, and immediately index them to wages. That would be $3bn well spent.”

The maximum Newstart payment is currently $272.90 a week for a single unemployed person, or just $38.98 a day.

The cost of essentials such as housing, groceries, energy, transport and clothing is a minimum of $433 per week, according to the Australian Council of Social Service (Acoss).

The national minimum wage is currently $694.90 a week for 38 ordinary hours’ work.

Byrne said giving the poorest Australians a decent standard of living was a moral issue and “quite obviously should be a Labor cause”.

“We must commit to increasing Newstart payments in the first term of a Labor Government,” he told Guardian Australia.

“I will bring that proposition to the floor of the National Conference so this shameful national problem is properly debated and confronted.

“When even the Business Council of Australia are advocating an increase in the dole you know it is time for the Labor Party to act.

“Failure to increase the meagre income of unemployed Australians in the first term of a Labor Government risks this national outrage continuing indefinitely. Coalition Governments will always denigrate poor people but never offer them a helping hand.

“Having provided the largest ever increase to the aged pension when last elected to government, our party must have the moral clarity now to lift the living standards of unemployed citizens too,” he said.

Bryne will move his amendment to the national platform through the caucus of the Left faction before the national conference, and then seek support from Right faction delegates at the conference.

Acoss says there are roughly 647,000 receiving the single rate of Newstart and Youth Allowance, and 55% of people who receive Newstart live below the poverty line.

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On Thursday the head of the Business Council renewed calls to increase the Newstart allowance, after the Liberal MP Julia Banks declared she could live on $40 a day.

Banks told ABC radio on Wednesday she could “live on 40 bucks a day knowing that the government is supporting me with Newstart looking for employment”, for which she was later ridiculed.

Banks, who according to her interests register owns five properties, including three investment homes, did not say where she would live in Melbourne, if she only had $40 a day to spend. As an MP, Banks receives $285 a night in travel allowance when she comes to Canberra, more than a Newstart recipient receives in a week.

Greens senator Rachel Siewert, said she attempted to live off the payment for a weekand it was near impossible.

“For anybody to make a claim that $40 per day is enough to live on shows they have become detached from the hardships experienced out in the community,” she said.