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May 15, 2012

If Labor's serious about fairness, it should reconsider welfare policies

One of the most obvious inconsistencies in the budget was the government’s claims for an egalitarian redistribution approach while proposing $60 per week income cut for 100,000 sole parents.


One of the most obvious inconsistencies in the budget was the government’s claims for an egalitarian redistribution approach while proposing $60 per week income cut  for 100,000 sole parents. On Meet the Press on Sunday, Anthony Albanese repeatedly ducked a why-do-that question by talking about finding them paid jobs. This suggests the government assumes cutting already low incomes makes people more likely to find jobs and that jobs are there.

One of the difficulties faced by a Labor government is trying to convince voters that it does have clear Labor values. Its mantra of being there for working families mixes with occasional accusations that Abbott, etc, are pro-rich, does not add up to fairness for all. The underlying message of the new payments illustrates its confused beliefs that voters are for sale to the higher bidder and voters will appreciate  fairness and show loyalty.

However, this blatant marketing strategy was already undermined by the government’s failure to include a badly needed rise for the inadequate Newstart payments. This will be the lower payment for sole parents. The ALP’s advisers’ cynical strategy assumes that “working families” would share their views on non-employed (bludgers). Even though the cuts did not get high media coverage, there was enough for the Robin Hood image to be criticised by welfare advocates and even many of its own backbenchers.

The ALP has developed some extraordinary authoritarian, punitive policies in the social areas and the budget provisions continue the conservative tendencies. Some familiarity with its own data would show the existing Newstart recipients have few chances of finding paid work and the numbers will soon swell with the extra sole parents and the somewhat disabled victims of new standards.

The government operates under the false assumption that there are available jobs for the unemployed who are not prepared to take them. Therefore, the government can pressure them by low income and further conditionality into services that reluctant or untrained  Newstart recipients need. The government claims are that the unemployment problem is in the supply side of the equation so starving them into compliance is for their own good.

Not only is this collection of attitudes reminiscent of the 19th-century Poor Laws approach, it also fails dismally to understand the demands of the labour market or the prejudices of many of its decision makers. Current unemployment rates are at least as much the fault of the demand side of the equation, i.e. the number and types of jobs on offer and the decision makers as the supply side. The government’s own figures show that most of the demand is for recent experience, youth, mobility and specific qualifications.

The government ignores its own website, which shows what jobs are available and who is officially job hunting. The figures barely overlap as demand is is for mobility, skill and experiences. This site has the most recent summary of job opportunities. In March there were ads for 225,200 job vacancies over the whole of Australia. These figures tend to be consistent with other indexes so, while it may understate the totals somewhat, it is probably a good indicator of what is available. Note the decrease in numbers over the past years:

“The Internet Vacancy Index (IVI) increased by 0.8% in March 2012 in trend terms, and has now increased by 1.3% since December 2011. Over the year, however, the IVI has fallen by 7.2%, and is 41.0% below the March 2008 peak.”

There are 774,124 government-sanctioned official job seekers for maybe about 250,000 vacancies. These are all  registered with Job Services Australia. They compete with all those other job seekers who are not on benefits or even officially unemployed.  They consist of 501,630 on Newstart plus 83,557 on Youth Allowance, 70,661 on parenting payments single and a scatter of further categories of those on payments looking for jobs. This means more than three such unemployed job seekers could potentially be looking at each listed job. However, the ratio of seekers to jobs becomes much worse when further data are examined.

First, the types of jobs on offer do not match many of the unemployed with limited qualifications. The list has 130,000-plus jobs, described as for managers, professionals, and trade/technicians, most presumably requiring qualifications and experiences. There may be more appropriate openings among the 15,000 or so community services worker jobs, or 17,000 labouring jobs but other areas such as sales and clerical again would often require skills and experience. So, out of all the above sectors, there may be about 50,000 vacancies that don’t require proof of skills and recent experiences. How many of these would be available part-time, say in school hours, is not indicated.

Secondly, who are these job seekers? They are not a broad cross section of the population. They tend to be older or younger: 212,211 job seekers are aged over 45, and therefore likely to be regarded by many employers as too old.  The 85,524 people under 20 probably lack any workforce credentials or experience and may have few attractions for employers with choices. Over 245,000, all up, have been on payments for more than 24 months so are likely not to present well and may not be seen by employers as good risks or having recent experience. Many are also responsible carers, newly arrived and/or lacking in English skills.

So, realistically, in March this year, there were 50,000 jobs that could in theory go to some of the people on the Job Services books, which makes the ratio of job seekers to jobs in this sector about 13:1.  There will be others looking at the jobs and questions of where the jobs are and what are the hours and physical demands as well.

The sole parents need jobs that allow them to manage their time with children, those with lesser but significant disabilities may have limits on their physical or mental abilities and both will also suffer employer prejudices.  Older workers have problems getting jobs, which is why the government is offering bribes. Younger workers lack experience and often any confidence to try something new. All long-term unemployed have been forced  to chase jobs they cannot get and are discouraged and depressed. They do not present as keen and interested. Few will even make it to an interview.

These figures show why finding paid work will continue to be difficult for most people on Newstart. Some subgroups, such as sole parents, will find it particularly hard because they need to balance children’s needs against workplace pressures. To meet potential worker needs, employers need to be approached to change working conditions and prejudices. Better child care for school-age children also will help, but basically only some will find current types of jobs.

If the ALP is serious about its commitment to fairness, it needs to reconsider its welfare policies. The current directions cannot be described as traditional Labor policies, as they resemble hardline conservatism. The built-in punitive values are evident in policies such as income management, limiting income, pushing recipients into futile activities. When the data show that the jobs are not there, it is even more unintelligible.


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11 thoughts on “If Labor’s serious about fairness, it should reconsider welfare policies

  1. klewso

    But wouldn’t that lead to -ve PR and bad press – the way much of our media is operated – for being “soft on bludgers”?

  2. klewso

    ….. sorry “electorally lucrative scapegoats”.

  3. GocomSys

    If the MEDIA were serious about its commitment to fairness, then it would allow this government to implement “traditional” Labor welfare policies. Until then, as KLEWSO pointed out it’ll be tantamount to committing “harakiri”. No can do, Eva! Let the atrocious media get their act together first! Bad news sells don’t you know? Anything good in the budget Eva?

  4. jmendelssohn

    Good article, as far as it goes. The best thing for sole parents is to provide well supported pathways to eventual full-time paid work, but that needs a major attitudinal change on the part of employers as well as governments.

    What is desperately needed is a way for sole parents, and others, to be able to work from home until sick and school holiday children are old enough to be left alone. In a world rapidly changing via the technological revolution, this should not be too much of an ask.

  5. Link

    Today I attended the first day of a short course I have been coerced into as part of my ‘mutual obligation’, i.e, do this or we breach you. It was a basic Cert II in Hospitality run by the local TAFE. I have nearly twenty years experience in hospitality from fine dining to cafes but at 48 it seems I am unemployable in this field where young, attractive bunnies who will naively put up with appalling conditions sans complaint are in great demand. All of the 6 people doing the course were there involuntarily. It is supposed to be 20 hours a week, but as the course convener said, it’s actually only 15, but we tell Centrelink it’s 20.

    When you connect with individuals at Centrelink, or Tafe (it seems) or with the Job Service Providers, ALL of them will conspiratorially agree that the system is both punitive and a complete joke. Is there anyone who thinks it works well, aside from people like Therese Rein and Julia Gillard?

    Job Services Australia are by their own admission completely useless. Centrelink say they are useless and certainly those of us who must negotiate with them know they are useless. It’s all about ticking boxes, and little to do with finding people jobs or putting them into suitable training courses.

    The Government fail to realise that an extra $50 a week or a fortnight for NewStart recipients would automatically go straight into the local economy and thereby add ‘stimulus’.

    I also wonder that Newstart recipients are going to miss out on any of the proposed carbon tax reimbursements because we are not ‘working families’.

    I am so riled Ms Gillard can exepect a strong letter from me fortwith. Thanks Eva you and an unlikely bedfellow in Judith Sloane are the only people (aside from the Greens) who bother noticing the unemployed and the ridiculous and punitive system they find themselves in.

  6. Elbow Patches

    Completely agree Eva. At the very least like to see policy initiatives that seek innovation in developing family friendly jobs in private and public sectors, and innovations in child care. Lots of parents have a patch when their kids are young teens where it is awkward for them, as no after school programs but kids are not necessarily fine left completely to their own devices. Perhaps there is scope for employing people to run after school homework/social clubs for young teens. Some kids also do have more illness/problems than others. So work from home options need exploring more seriously. JMendelssohn makes good points above too.

  7. wbddrss

    If employer groups & their members were really fair dinkum about flexibility, then all these unemployed people would have jobs. What employers & employer groups are good at is being stubborn hard nosed negotiators. They are out to screw the system. Big time. No sacrifice on their part just total conceptual laziness towards seeing unemployed in a scenario working for a better future for all. I feel all bosses are lazy, dumb & stupid & definitely not academically gifted enough to get a hard science degree. They handle meetings well but are poor strategists. If the private sector were as good as they make out in principle , then Australia would be the best country on earth. As industries disappear and skills are lost ; then we are on a slippery path all because bosses want the good life without helping their fellow human beings adapt, be flexible & contribute to a better society. Employer groups should go further than being a bad example but be a good example of sustainable , flexible stategies, policies, procedures & practices with full audit trails in HR to make sure all members of the teams are performing. Instead we get the opposite.
    When was the last time management had a database of emplyee skills reconciled to company requirements. Never.
    Thanks Eva Cox for a fair & balanced presentation of the facts. I take my hat off to you.

  8. Tom Jones

    It is amazing that our Labor values PM doesn’t understand that single parent families are incredibly difficult to manage because children are often traumatised as are the mothers because the most common age for a break up is about when the children reach the age of 8. Anyone who has raised children knows that many go off the rails in their teen years if left unsupervised. There was an opening for Tony Abbott but I guess he prefers nannies for the rich to stay at home poor mothers who care for their own kids.

  9. AR

    Labor cannot square the circle of supporting the needy and pandering to middle class prejudice.
    No politician ever lost votes by pointing out an Enemy (and such is the cognitive dissonance of yer avrij lumpen that it could just as easily be their kid or sister being pilloried).
    Never mind that there are MORE than 3 times as many U/E as jobs (the 750K doesn’t include the unregistered or the underemployed), it is They who are eating our babies and sending the country broke.
    And sometimes they are even of the tinted persuasion.

  10. JMNO

    A good article Eva Cox. I have been wondering who is going to look after the kids when they are sick or during the school holidays if Mum is out at work. And who will get the blame when they run amuck because there is no-one around to care for/supervise them at home?

    The Job Network seems to be largely a waste of money. I spent yesterday completely rewriting a resume for a recently-arrived refugee who’d had a poorly presented and uninformative resume prepared by a Job Network provider and I have done this many times. Some other refugees I have worked with have been referred on to do training, like Link above, which is more about getting people off their books or complying with some rule rather than a serious attempt to equip them for work. As a volunteer I do work – resume writing, interviewing coaching, talking about employers’ expectations – that I would have thought should be the bread-and-butter of the Job Network.

    If the Government is serious about getting people into work then they need to change the whole model of job assistance. New arrivals – and refugees who have been here for quite a long time -, older workers, women who have been at home for a while, the other long-term unemployed need a quite different approach. Not only do they need assistance with resume writing, interview skills, workplace culture but Job Networks should have partnerships with training providers and employers, should do a proper assessment of a person’s training or employment needs, refer them on and then be around for follow up to help solve the kind of teething problems that arise when a person enters the workforce in a new country or after a long absence. If the Job Network had proper partnerships with training providers and employers, then they would really be able to get people into the workforce.

    Another problem is that the Job Network is fragmented so it not in a strong position to develop a data bank for example, of good resume examples, training materials, to train their own staff, to develop those strong networks with training providers and employers. So the service they provide is highly variable – some staff know what they are doing, others – like those whose resumes I have rewritten are not equipped for the job.

  11. Queen Clytie

     Eva – thank you for this insightful analysis. Inspired by your article, I’m embarking on a little exercise to analysis Labor’s policies in this area against their stated values.

    I began my career in the very late 1990s as the welfare-to-work, mutual obligation agenda started to roll out, and I think it’s one of the most poorly-analysed policy agendas in the country.  This country is so focussed on the national sport of ‘bludger bashing’ with absolutely no idea what they are actually talking about.  

    Ten years of reform, and what to show for it?A very expensive and over-regulated employment service structure that adds next to little value sitting alongside a heavily bureaucratised and ineffective income support system.   As JMNO points out, the regulation of the Job Network, which has now filtered through to specialist disability employment services, dictates a generic response which fails to leave room for providers to moderate their delivery to meet the needs of job seekers and the employers they try to match them to. No-where is this more obvious than in the DSP and the reforms to the disability employment services where despite a decade of reform Australia is one of the poorest performers for poverty and employment of people with disabilities.  In fact, for some people with disabilities (particularly intellectual disabilities) we have in fact regressed. Those of us working in the disability policy space who have watched this reform unfold are now watching with great caution as the Feds embark on crafting a National Disability Insurance Scheme.  We want the reform, but we are slightly terrified as to what it might look like.

    The ‘bribes’ that Government are now paying for employers to employ older workers won’t work, either.  In the disability experience, many of the most effective services don’t use subsidies because they are not effective – an employer who will require a subsidy to employ someone with a disability is not likely to be providing the kind of workplace and culture that will be supportive and the job is not likely to last.

    Employer groups need to start showing leadership and shaping the expectations of their members though to make sure that we are managing that demand side effectively.  Not enough has been done here and not enough responsibility taken by employers.

    Income support policy is based on flawed assumptions about how people navigate the world, make decisions, and weigh up costs and benefits.  It also assumes, as you rightly point out, that there is some neat correlation between the unemployed and the jobs available – a correlation which you demonstrate doesn’t exist.

    One of the groups which the numbers probably don’t pick up on are people on the Disability Support Pension who want to work.  As these people are not activity tested, they are probably not accounted for in the official numbers of those looking for work.  Same goes for those who are under-employed, or who are working in sheltered employment but want to transition to regular jobs in the community (a transition which DEEWR have actively prevented).  In Australia we have focussed so heavily on stopping people getting onto the pension, that if you now manage to actually get the pension – no one seems that interested in whether you work or not.  

    As for the potential ‘limits’ on participation by people with significant disabiliites – let us be careful not to overstate them.  And research suggests that employer prejudices against them are largely based on not being sure how to proceed.  Those with lots of experience in supporting people with disabilities in employment will tell you that employers are largely not the problem.  Getting the right support to get the right job is the problem.  Again – we know what works in order to support more people with disabilities to get sustainable jobs, but our system makes it hard to get that support where and when it’s needed.

    Finally, it is my view that there needs to be some in-depth analysis of the Department of Education, Employment& Workplace Relations (DEEWR) against their performance against the policy objectives that have been set for them.  And I mean a detailed analysis – because the devil really IS in the detail.  There is so much in the detail of their policies that work against the objectives they are there to achieve.  And it’s largely because DEEWR’s culture as an organisation dictates that they know best.  They are the ‘control freak’ organisation of the bureaucracy and they don’t pay heed to the expertise of others.  

    It’s also time that we started having some independent input into the data which Government departments collect and report on so that we can all be clearer about what’s really happening.   


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