A Senate committee has recommended keeping the unemployment payment at its current level, despite finding it is too low for people to live on in the long-term.

The Greens had pushed for the base rate of the payment to be increased by $50 a week.

The committee heard that would cost $15 billion over four years, and even though Labor senators expressed their "in-principle support" for an increase, it was rejected.

The Senate inquiry agreed the Newstart Allowance was inadequate, but added the dole was never intended to be a long-term solution to unemployment.

The welfare sector is bitterly disappointed with the decision, saying there is overwhelming evidence the payment is far too low and needs to be urgently increased.

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John Falzon, from the St Vincent de Paul Society, says he cannot understand the committee's report not recommending an increase.

"That fact has been screaming out to all of us for quite some time," he said.

"You've got an unemployment benefit that has not been lifted in real terms since 1994 - so low that it has become a barrier to employment participation.

"This is no way to help people into the workforce. You don't help someone get a job by forcing them into poverty.

"You don't help people up by putting them down, and that's what this allowance does."

The committee's majority report recommends more resources for newly unemployed people in the first weeks and months of losing their job.

It also recommends the Department of Employment work with job agencies to better target training and support programs for older workers.

It wants a more generous income-free threshold for long-term unemployed and for departing Newstart recipients to stay on the data system for a year after they get a job.

'Too low'

The welfare sector is vowing to continue campaigning for a $50 a week increase in the dole, hanging its hopes on the findings of the government senators.

One of the two Labor senators on the committee, Gavin Marshall, took issue with the Coalition's rationale.

"It is plain that the Newstart allowance is too low, particularly for single recipients," he said.

"For this reason Newstart Allowance Single should be increased.

"We are, unfortunately, in a situation where Newstart is designed to transition people from unemployment into work, but there is a significant amount of people who this Newstart Allowance actually becomes, because of a whole range of reasons, the only support that they have in our community."

Greens senator Rachel Siewert spent a week trying to live on the equivalent of the dole earlier this year.

"Here we have identified the inadequacies of Newstart and we're about to dump - on January 1, we dump 84,000 single parents and their children on to inadequate - clearly documented inadequate - Newstart payment," she said.

"And I had an email just this morning from one of those single mothers and I'd like to read it:

'I am absolutely in shock that my parenting payment is about to be reduced by about $200 a fortnight. 'I had a Centrelink employee ask me if I needed to talk to a counsellor. A counsellor - I need to have the $200. 'I am in a legally binding lease, I have payments for my car, internet for my son, and all the other expenses in life. 'I do the right thing, I work double what Centrelink requires, but I cannot find full-time work. It would be like tapping the highly-paid Centrelink employee on the shoulder and saying, by the way, at Christmas, we are halving your wage.'

Employment Minister Bill Shorten's only comment was to say the Government would give careful and serious consideration to the findings of "this important inquiry", thanking senators and all contributors for their work.

Mr Falzon said the Government should not feel it has been let off the hook just because there was no recommendation to increase the Newstart Allowance.

"The reality that people who are on unemployment benefits, including single mums who are going to be pushed onto that unseemly benefit as of January 1 - charity will mean the difference between staying in accommodation and sleeping in a car," he said.

"This is a matter of grave injustice, that people are being left to rot on a level of unemployment benefit that keeps them below the poverty line."