The system is pretty effective at making getting a job and staying in it the path of least resistance. Being on newstart is worse than having a job.
The unemployed are easy targets for political capital, it's a marginal contribution to Australia's overall welfare bill. There's nothing better than anecdotal evidence that abuse of the system is common. With the prohibitive barriers that the government has set up that restrict the capacity of businesses to employ people, and restrict the ability of individuals to practice entrepreneurship in a wide range of industries, I think by putting these barriers in place, the government then takes on a moral responsibility to provide some assistance to ameliorate the harm caused by these financial barriers.