A rise in the unemployment benefit will cost the budget $9 billion over the next four years.
The JobSeeker rate will permanently increase by $50 a fortnight from April.
This equates to an extra $3.57 a day.
In exchange, recipients must show they are actively looking for work as part of stricter eligibility and mutual obligation requirements.
Prime Minister Scott Morrison says the package strikes the right balance.
“Every person we get in a job, they’re better off and the country’s better off, and so that remains our objective,” Mr Morrison says.
“If you’re on JobSeeker, we’ll work night and day to get you off it and into a job.”
Welfare groups have sharply criticised the amount, with Australian Council of Social Service CEO Cassandra Goldie calling the amount “measly”.
She says it shows that the government is “unable to understand what it’s like not to have a lot of money”.
Prior to the announcement, Ms Goldie had called for a minimum payment of $65 per day, compared with the current rate of $51 a day and the pre-pandemic allowance of $40.
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