Wed May 1

what does this mean for income support?

Written by Karinna Saxby, Research Fellow, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne

Increasing income support could help keep women and children safe according to new work demonstrating strong links between financial insecurity and domestic violence.

Our mapping of local government areas in Melbourne and Sydney reinforces the relationship between unemployment and the greater risk of violence.

At a time when the nation is speaking out against the killing of women by men – with at least 27 deaths ^[1] recorded since the start of this year – the federal government is under increasing pressure to help those at greatest risk.

How money might help

Financial dependence can trap people in abusive relationships. The dependency creates barriers to leaving ^[2], as victim-survivors may not have the money necessary for alternative housing, legal help and basic living expenses.

Higher income support for women can change the dynamics within relationships by enhancing their financial decision-making and bargaining power ^[3] within the household.

However, the relationship between economic factors and domestic violence is complex.

While higher income ^[4] generally corresponds with lower domestic violence, overseas evidence suggests higher unemployment benefits may lengthen unemployment spells. In such situations, joblessness could lead to violence ^[5] due to increased exposure between perpetrators and victim-survivors at home.

Economic downturns and personal financial crises can also cause uncertainty and household stress, which may escalate into abuse ^[6].

These economic patterns are clear in Australia. Areas with low-income and high-unemployment tend to have the highest levels of domestic violence.

Problem areas

The graphics below illustrate this by mapping unemployment and violence rates across local government areas in greater Sydney and greater Melbourne. The patterns are striking. High rates, marked in darker red, often occur in similar locations.

In Melbourne, the areas with the highest levels of both unemployment and domestic violence are greater Dandenong, Frankston, Casey, Cardinia, Maribyrnong, Brimbank, Melton and Hume. They are marked in red.

In Sydney, the highest rates are in Campbelltown, Liverpool, Canterbury-Bankstown, Fairfield, Penrith, Cumberland, Blacktown and Hawkesbury.

The economic disparities in domestic violence have also increased in recent years. In 2001, rates of violence in the most disadvantaged parts of New South Wales were about 5.6 times higher in the most advantaged suburbs. In 2023, these differences were almost 6.5 times higher.

Long lasting impact

Domestic violence disproportionately impacts women and children ^[7] and can create significant long lasting social, health, psychological and financial damage.

Estimates suggest the lifetime cost of domestic violence for every victim-survivor is in the tens of thousands of dollars. Healthcare costs alone are close to A$50,000 ^[8] for every person directly affected.

And the broader costs are staggering.

National data from 2016 which looked at costs including medical care, lost productivity, legal fees, and extended social services, puts the total annual costs at about $22 billion ^[9].

This shows the problem is not just a critical social and health issue, but a major economic challenge for victim-survivors and the nation.

Helping to solve the problem

Providing adequate financial support to vulnerable people during times of economic uncertainty is critical to reduce domestic violence and its harmful effects.

But unemployment benefits in Australia are much lower than in other OECD countries. JobSeeker is only $386 per week – 43% of the full-time minimum wage. Australia is ranked among the lowest of all OECD countries ^[10] when it comes to unemployment benefits, second only to Greece.

International evidence ^[11], based on more generous support schemes, suggests raising benefits may lead to extended periods out of work and therefore greater exposure to violence at home.

But this is unlikely to occur in Australia if JobSeeker payments are raised. Given the current low rate, there will still be a considerable financial incentive for JobSeeker recipients to get paid work if the rate is increased.

Analysis of the almost doubling of payments during 2020 ^[12] supports this conclusion.

Improving economic safety nets could help prevent environments that breed violence. Investing in safety is an essential step towards combating Australia’s domestic violence crisis.