For single mothers, financial concerns have been top of the list for far too long

Millions of Australians are currently dependent on some form of government welfare payment, and many are experiencing financial stress for the first time. As the consistently poorest household type in Australia, single mothers are disproportionately acquainted with the distress of trying to maintain a household on low welfare payments and precious employment. Unsurprisingly, new ABS data indicates that single mothers have had the worst employment outcomes during COVID-19.  In today’s analysis, Margaret Ambrose of the Council for Single Mothers and their Children (@CSMCVIC) reports on the findings of a national survey of single mothers to uncover what their pain points are, and how these might be addressed to increase their financial security and place them and their children on a positive trajectory.

Single mothers struggle at the intersection of low welfare payments, irregular child support, and precarious employment. COVID-19 has made their financial situation worse. Photo by engin akyurt on Unsplash

The worries of single mothers are as many and varied as the multitude of responsibilities they juggle. Yet there’s one issue that unifies them all; a staggering 90 per cent of single mothers are concerned or greatly concerned about their long-term financial wellbeing.  

It is the number one problem keeping single mothers up at night – and yet the solutions are readily available.

According to the results of a national survey of over 1000 single mothers across Australia, conducted by the Council of Single Mothers and their Children (CSMC) prior to the advent of COVID-19, over 70 per cent of single mothers across all income brackets find it difficult or very difficult to meet their general living expenses and 44 per cent of single mothers have no savings.

The advent of COVID-19 means that the tenuous financial position of single mother families has become more complex and, overall, has been further eroded.

For many of the 42 percent who rely on government payments as their main source of income, there is a brief respite as the JobSeeker Payment (formerly Newstart) and Parenting Payment Single have been significant increased by the Coronavirus supplement. Single mothers who have been consumed with financial stress over years of providing essential unpaid care for their children tell us they have been able to buy essentials like a working fridge and children’s clothing, and purchase sufficient food.

On the other hand, unemployment among single mothers has increased for the 65 per cent of survey respondents in some form of paid employment. Many casual workers have lost their critical income, and those holding onto jobs are struggling with fears of infection for themselves and their children as they go to work, or trying to balance full- or part-time workloads at home whilst home schooling. Simultaneously families have needed to equip their children with the essentials for home schooling: internet, devices and stationery supplies.

In order to ensure all single mother families have equal access to opportunities in the post-COVID-19 world and do not get left behind, it is essential to understand their position going into the pandemic.

Single mothers experience high rates of financial stress

CSMC’s national survey found that the impact of financial stress is having significant repercussions on the families of single mothers.

Figure 1: Major challenges identified by survey respondents

Single mothers said that having insufficient funds to meet daily needs undermines housing security; reduces food budgets; results in children missing out on educational and social opportunities; and delays health and dental care. These mothers also face a heightened chance of poverty and homelessness in older age. 80 per cent identified ensuring their family’s financial security as their key challenge, with 60 per cent stating that managing their mental health or other health issues as the second key challenge; see Figure 1 for more information.

With the advent of COVID19, many in the general population are now experiencing the social isolation and financial stress that too many single mothers experience daily. Low income families are differently affected by the need to home school children in isolation, with barriers to digital engagement, less house and garden space, and fewer books and other resources. These parents all fear their children may slip further behind their peers, with potential long-term repercussions.

Drivers of financial insecurity

Several themes emerged regarding what contributes to financial stress. ‘The ever-rising costs of rent, insufficient supply of family-friendly jobs, and arbitrary and inequitable Government policies all mean it’s almost impossible to build any kind of financial security,” explains CEO of Council of Single Mothers and their Children, Jenny Davidson.

Things are even bleaker for families where the mother or child lives with a disability (including 40 per cent of survey respondents). Many of these families are precluded from government benefits, despite their disability or caring responsibilities preventing participation in full-time work or, for some, any paid work. Both carers and those on the Disability Support Pension have been excluded from the coronavirus supplements to government benefits, further marginalising these families and exacerbating the stresses of managing an already difficult situation in isolation.

Many women who are employed causally – often the work most accessible to women with small children – have lost their jobs in the pandemic and face an uncertain job market as restrictions start to lift. Single mothers with professional expertise (and nearly half the survey respondents have a university degree) were shielded longer from immediate unemployment but are now losing jobs or employment security.

While all government benefits have been too low for decades, moving single mothers to the JobSeeker payment when their youngest child turns eight years old pushes the family further into poverty and fails to recognise the value of the mothers’ ongoing unpaid care work to the economy. This is clearly demonstrated by sharp increase in poverty in single parent families since the change was legislated, from 47 per cent in 2009 to 66 per cent of families in 2014, according to the latest ACOSS Poverty in Australia report.

Viable solutions

According to the Council of Single Mothers and their Children, financial hardship amongst single mothers could be dramatically reduced in Australia with a few changes in legislation and alterations to the child support collection system. See Figure 2 for those issues most often raised by survey respondents.

Structural barriers to securing paid work that complements single mothers’ immutable family responsibilities must be dismantled if they are ever to have the chance of working their way out of poverty. Ironically, with the advent of the coronavirus pandemic, some of the flexible work arrangements single mothers have been asking for are now normalised. While competition for jobs will escalate when isolation is rolled back and industries recover, if some of this flexibility is retained, single mothers will find some benefit. More permanent part-time job opportunities at all skill levels is also essential to increase the financial security of single mother-headed households and all those with caring responsibilities.

Figure 2: Areas most in need of change identified by survey respondents

Mutual obligations are unduly onerous, particularly for parents, and provide too few positive outcomes for those compelled to participate in JobActive and ParentsNext. The relief from onerous obligations attached to JobActive and ParentsNext participants must be extended beyond the current suspension until 22 May and be replaced by voluntary and genuinely beneficial work-readiness and employment programs. This will assist in facilitating recovery for both families and the economy.

Other areas for revision include the cost and inflexibility of childcare and income thresholds for JobSeeker and Parenting Payments, which are far too low to allow recipients to ‘work their way out of poverty’.

Child support is a poverty reduction strategy crying out for improvement. The child support system, which should assist with the costs of raising children, is instead $1.6B in arrears and is simply not functioning. One in three of respondents to the survey rarely or never receive their child support payments. Among those single mothers using the formal government child support collection system, only 23 per cent receive the payment in full and in time. Other research modelling shows that when child support is fully paid, it has the potential to reduce the poverty in single mother families by 21 per cent and assist mothers to maintain viable employment.

Notwithstanding the dire circumstances of many single mother families, the study reveals that women prioritise their children’s wellbeing. This frequently means doing without, including skipping meals, walking to save the cost of public transportation, or delaying the purchase of their own clothes, shoes and medication. Among these women, over 70 per cent have the care of their children 100 per cent of the time.

Regardless of the financial challenges facing these families, the overwhelming message from the CSMC survey is that single mothers in Australia are resilient, proud and determined to create a bright future for their families.

As we envision a new world post-pandemic, we must hold onto the gains made in increased government benefits and innovative service provision, and refuse the calls to ‘return to normal’ where, as this national survey clearly reveals, too many families were not flourishing.

Read the full report, One in Eight Families: Australian single mothers’ lives revealed

This post is part of the Women's Policy Action Tank initiative to analyse government policy using a gendered lens. View our other policy analysis pieces here.

Posted by @SusanMaury @GoodAdvocacy