New survey: Australians experience 'high level of financial distress'

New study identifies ways to improve work and health outcomes for employees

New survey: Australians experience 'high level of financial distress'

Australians reported having high levels of “financial distress,” scoring it eight out of ten, with ten being the highest, based on the latest cross-sector systems government project.

“Data collected was able to capture and describe respondents’ levels of financial distress, with more than half of respondents disagreeing that they had enough income to cover their essential living costs,” Comcare revealed in a report.

Period of no income

One key contributor to the financial burden among Australians is the long periods of receiving no income.

The survey and its findings, published by Monash University, showed that 52% of Australians, or more than half of the 779 participants, reported not having an income to cover living costs as they transition from one income support to another. This absence of income usually lasted between seven and 15 months on average.

“Waiting to receive benefits is the most common reason for reporting no income,” the report said. “When a person is receiving no income, they rely on personal savings, family members, selling assets, or they go without.”

Income support systems

Reasons behind the transitions between support systems or why people interact with them concurrently vary from one person to another based on the survey.

However, it showed that most Australians rely on Centrelink for income support systems with a total of 86%, followed by early superannuation withdrawals (29%), workers compensation (21%), and life insurance (18%).

“Movement between systems is best described as using a pinball analogy, where people bounce, rebound and utilise multiple systems simultaneously,” the report stated. “It appears that movement between systems may also be based on social factors such as the cost of health care, the individual’s specific needs, and their family and economic situation.”

The government also said that the transition between systems could take months and often involves extended periods of absence of income.

Challenges faced by Australians

Based on the report, when it comes to the transition between systems, some of the challenges encountered by Australians include:

  • Lack of support
  • Difficulty with paperwork
  • Difficulty adjusting to changes in life circumstances
  • Lack of communication
  • Occurs when people are not operating at their full physical and mental capacity

Meanwhile, individuals within a system often experience the following challenges:

  • Unaware of available options
  • Difficulties with job providers
  • Difficulties returning to work
  • Inability to plan for the future
  • Physical burden
  • Psychological burden
  • Reliance on informal supports
  • A need to self-advocate

Among the recommendations of Comcare is to improve the experience of every Australian, including raising the educational awareness of the public on the different income support available, using a common language across all systems, and having administrative handover between systems.

The government also said it is essential to create systems to streamline application processes and future-proof systems to further improve the assistance and extend case management function to ensure individuals get the most appropriate income service available to them.

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