The Government will end benefits for people who have worked and paid taxes for at least six months if the Government wins the next election, as part of a plan to tackle the budget deficit.
The measures will come into effect in April next year.
The government said the changes would help to reduce the deficit by $7.4bn over the next two years.
“It is a good start to help reduce the debt, which is a vital issue for our economy,” Finance Minister Michael Noonan said.
Employment Minister Brendan O’Connor said the move would help reduce costs, reduce the need for workers to go on jobseeker’s allowance, and help people to access employment support, including unemployment benefit.
A spokesman for the Australian Council of Social Service said the change would help some people who are struggling to access support, and “it’s a real boost to their confidence and productivity”.
The Government said the cuts were “not about making more money”.
“We know that the unemployment benefit is an important support for people and is essential to help them get back into work and get on the job market,” Mr Noonan told the ABC.
Mr Noonan’s comments come after Mr O’Neill last week said the Government had “changed the way we pay for social security”.
Mr O’Neil said the welfare system was designed to make sure people who needed it the most were able to get it.
He said the new measures would help people with low incomes and those who have had to cut back.
People in full-time work will receive about $30 a fortnight, while people in part-time employment will receive $15.
If you are earning $18,200 a year and working 40 hours a week you will get $1,500 a fortnight in social security.
Those with children will receive the same amount, while those in a care home will get about $1 per week, according to the Government’s statement.
Many Australians are worried about the cuts to the welfare bill, with many wondering if the money will be enough to cover their needs.
One former employee of a local welfare agency, who wished to remain anonymous, said she had lost about $500 a month after her job was cut.
She said she was forced to work more hours than she was used to, and was struggling to afford her rent and food.
Social Security Minister Kevin Andrews said the government was focused on “our economy, our people, our communities”.
A report from the University of Canberra found that about 60 per cent of people receiving benefits were employed, and that of those receiving jobless benefits only 15 per cent were.
More people are working than ever, and the number of Australians employed has increased over the past decade.
It found more people were working than in the early 1990s, with fewer Australians receiving benefits.
Despite this, unemployment remains a big problem, with the number being higher than ever before, and more than a quarter of the workforce is unemployed.
There are some concerns about the timing of the changes, with some analysts saying the cuts could take effect as soon at the end of April next years.