The federal government is poised to expand rebates and concessions available to job seekers in next week’s federal budget, which is also expected to increase rent assistance.
The treasurer, Jim Chalmers, has confirmed that Tuesday’s budget will not increase the jobseeker payment but suggested it would boost concessions linked to social security payments, among a suite of measures designed to offer cost-of-living relief without pushing up inflation.
In a pre-budget interview on Thursday, Guardian Australia asked the treasurer if he would rule out raising jobseeker and, if so, whether he would extend concessions instead.
“There is more than one way to help people who are on income support payments and pensions,” Chalmers said.
He did not rule out extending the $500-a-year energy rebate for low-income households for another year. The payment, agreed with the states last year, is due to expire on 30 June and was available to concession card holders and those receiving working-age payments and pensions.
The government-appointed Economic Inclusion Advisory Committee recommended in its latest report published two weeks ago that jobseeker and associated payments should be increased as a matter of urgency. It did not recommend in-kind assistance via rebates and concessions, only an increase to the base rate.
At the time Chalmers said the government could not do everything the committee recommended immediately and declined to offer a timeline for a rise. Labor increased jobseeker by $40 a fortnight in the last budget.
On Thursday Chalmers pointed to the already-announced tax cuts taking effect from 1 July as the “foundation stone” of the budget’s cost-of-living relief.
“We are obviously very attentive to the fact that people on fixed incomes, people on payments and pensions are also under cost-of-living pressure, and we’ll respond to that,” he said.
Chaired by the former Labor minister Jenny Macklin, the Economic Inclusion Advisory Committee recommended a rise in commonwealth rent assistance but warned it risked pushing up rents and would offer little relief to recipients of government payments unless they were also increased.
Chalmers said he did not accept that such a rise would push up all rents, which the Reserve Bank says increased by 10% on average last year, outstripping inflation. He pointed to Australian Bureau of Statistics advice that raising rent assistance in last year’s budget had stopped the rises being worse.
“I took great heart and great encouragement from that,” he said. “They [rents] are still high, I’m not pretending otherwise – too high. But they would be higher had we not established that permanent increase to the CRA last budget.”
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Asked if he believed that further boosting rent assistance could be effective, he said: “Yes.”
Chalmers is badging his budget as being about “restraint”, “relief” and “reform”, effectively confirming he will deliver another wafer-thin surplus. The government says it will bank $27.9bn in savings and “reprioritisations”, including $3.8bn not previously announced. But Chalmers denied the bottom line would be more reliant on China than on reform, despite the price of iron ore and coking coal staying almost double what last year’s budget forecast.
“The big driver of the upward revisions to revenue in next Tuesday’s budget will be the labour market rather than commodity prices,” he said. He foreshadowed a “modest, very modest, revenue upgrade”.
The budget will reveal that employment has grown more strongly than forecast, set to come in at 2.25% in the year to June. In December’s mid-year budget update it was forecast at 1.5%.
Chalmers echoed an observation by the Reserve Bank governor, Michelle Bullock, on Tuesday after the bank’s board opted to keep interest rates on hold, acknowledging that a spike in migration was putting pressure on housing. Describing housing as a strong budget focus, Chalmers said previous investment had been aimed at easing the pressure of a growing population.
“Migration is not the only reason we’ve got a housing shortage and we shouldn’t pretend that it is,” he said, adding: “It has been a long time coming and it will take us a little while to turn around.”
Chalmers also acknowledged Bullock’s admission that the bank board was trying to avoid recession. He said the budget would help the battle with inflation, not hinder it.
“We need to get on top of inflation without smashing the economy.”