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Poverty with and without COVID income supports

COVID-19PovertyTrendsHow has it changed?poverty

These graphs show the number and rate of people in poverty during the COVID recession and early stages of the recovery up to January 2021.

They use the 50% of equivalent disposable household income, and the results have been adjusted to take account of housing costs, and shows the difference that the COVID income support payments (mainly Coronavirus Supplement and JobKeeper Payment) made to the number and rate of people in poverty.

The graphs show that:
* In June 2020, 9.9% of people were below the poverty line, compared with 11.8% in 2019 and 22.7% who would have been in poverty in June 2020 without the new income supports (Figure 8a).
* An estimated 2,613,000 people were in poverty in June 2020, well below the 3,018,000 in 2019, and half the number that would have been in poverty (5,772,000) in June 2020 had COVID income supports not been introduced (Figure 8b).

This confounds the traditional view on the impact of recessions on incomes – if income support payments sit below the poverty line, an increase in unemployment is likely to be associated with an increase in poverty.

The graphs also show that poverty increased during the recovery, as the COVID 19 income supports phased down:
* From 9.9% in the recession in June 2020 to 14% at the end of that year (when the Coronavirus Supplement was reduced to $125pw);
* From 2,613,000 people in June 2020 to 3,820,000 in January 2021 (when the Supplement was reduced further to $75pw).

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