Justice Stocktake 2025

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Home | Financial hardship and inclusion

Financial hardship and inclusion

Although poverty is often hidden in Australia, it can be a crushing reality for those experiencing it. Financial hardship often involves making impossible choices between essentials — food or rent — and being in a near constant state of worry and stress about having your basic needs met. Stress around financial pressures can have negative impacts on people’s health and wellbeing. Fear, shame, and the feeling of being trapped cause significant harm, and individuals may withdraw from community and friendships, becoming isolated. Experience of poverty can easily change a person’s life trajectory, impacting employment, housing, education and health outcomes for much of their life.[1]

Many Australians are only a few financial shocks away from severe financial hardship, that could look like losing a job, sudden or chronic illness or a relationship ending. It’s important that we build our system so that a financial shock does not mean long-term experiences of poverty. Unfortunately, our current social welfare system is not fit for purpose. People who are relying on income support payments are unable to afford necessities, often having to go without meals, falling behind in payments, or having to access debt to stay afloat. This is the case no matter how savvily or carefully they budget. Such a low income makes it hard to find secure and stable employment and can lead to long-term unemployment, social isolation, entrenched poverty, and intergenerational disadvantage.

Cost of living pressures are affecting almost all Australians but they are not affecting us equally. It is critical that we make sure those who are doing it toughest can still have their needs met.

3.3M living below the poverty line

In 2022, there were 3.3 million people (13.4 per cent) living below the poverty line, including 761,000 children (16.6 per cent).[2]

$8 per week left after essentials

The 2024 Red Shield Appeal report found that people accessing emergency relief had $8 a week left after essential spending such as housing and groceries. Respondents who were reliant on government payments went backwards and had -$2 after essentials.[3]

Poverty is more pronounced for women than men, with larger gender differences in rates of poverty for young women and women aged 55 and over.[4]

People who experience childhood poverty are up to 3.3 times more likely to remain in poverty in adult life.[5]

We have the power to make a difference

We can urge action from our governments

Our social safety net is failing people. The Commonwealth Government needs to review and radically increase the rates of income support, such as JobSeeker and Youth Allowance, so that unemployment does not mean long-term poverty.

Governments need to work together to prioritise ending homelessness and housing stress. A commitment and concrete plan to increase social housing to at least 10 per cent of housing stock in Australia is a key intervention that will ease housing stress across our community.

We can implement change in our community and our workplaces

Workplaces and community groups often support causes through fundraising and learning opportunities. Poverty is a foundational social justice issue that leads to, results from, or exacerbates every other disadvantage in this report. When we are choosing a cause to highlight, we can choose ones that address the underlying issue of financial hardship.

When organising events, activities and memberships we can keep in mind that cost may be a barrier to some people participating. We can actively keep the individual cost of participation as low as possible and consider providing bursaries or scholarships to assist with costs that can be accessed without shame or stigma.

We can have influence in our personal lives

We can give to or volunteer with groups that are working to support people experiencing poverty. While structural issues need to be addressed, in the meantime there are already so many people doing what they can and so many opportunities to get involved. Acting in our own communities, we can make a difference for people one at a time.

  1. Royal Children’s Hospital Melbourne. (2019). Strong Foundations: Getting it Right in the First 1000 Days: A Case for Investment. 28 [Link] ↩︎

  2. Davidson, P., Bradbury, B., & Wong, M. (2023). Poverty in Australia 2023: Who is affected. Poverty and Inequality Partnership Report no. 20. Australian Council of Social Service and UNSW Sydney. ↩︎

  3. Verrelli, S., Russell, C., & Taylor, E. (2024). Findings from the 2024 Red Shield Appeal Research Project. The Salvation Army, Australia. ↩︎

  4. Duncan, A. (2022, March). Behind the Line: Poverty and disadvantage in Australia 2022. Bankwest Curtin Economics Centre. [Link] s ↩︎

  5. Vera-Toscano, E., & Wilkins, R. (2020). Does poverty in childhood beget poverty in adulthood in Australia? Melbourne Institute: Applied Economic & Social Research, University of Melbourne. ↩︎

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