Number of households living below income floor is growing

The research built on modelling by the Welfare Expert Advisory Group and extended it to cover varying levels of income and expenses across 39 household types over eight years. It showed that incomes in many households are failing to meet both core living costs and the costs needed to meaningfully participate in society, placing thousands of children at risk of entrenched hardship.

“This modelling shows that our society is seriously failing children who live in low-income households. Families continue to be locked in poverty and unable to break through the constraints of the income floor,” said CPAG research and programmes officer Dr Harry Yu Shi.

The research found that couples with two children working 40 hours a week on the minimum wage are already in deficit in 2025. By 2026, even 60 hours of work will not be enough to lift them above the income floor.

Sole parents with three children in private rentals are $170 short each week of meeting basic costs, leaving them far below the income floor regardless of whether they receive Best Start support or not.

While incomes improved modestly between 2021 and 2024, the research shows households are now universally worse off from 2025 onwards.

“The evidence is clear: even working full time or combining wages with benefits is no longer enough to enable families to break free of the constraints of poverty,” said Dr Yu Shi.

CPAG is calling for immediate increases to core benefit rates, stronger indexing to living costs and policies to lift working incomes.

“We cannot accept a system where our children are unable to flourish because the powerful currents of our economy force families to live below the income floor,” said Dr Yu Shi.

FULL STORY

Families below the Income Floor face growing crisis – new research (CPAG)