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Social Policy

The future of welfare in review

24 Nov 2014, by Informa Insights

By Nicole Rees, Senior Manager Policy, The Brotherhood of St Laurence (Future of Welfare 2014 Conference Chair of Day One)

This conference was very timely.

It was timely because there is so much going on at the moment that will impact directly on our welfare system as we know it.

Future of Welfare - Patrick McClureIt provided a good opportunity to take stock, to try and join some of the dots, and to share ideas, visions, hopes, and concerns as we move through a period of significant flux.

We heard from Patrick McClure, who is heading a major review of the Australian Welfare System commissioned by the Australian Government. I understand his group is due to provide its final report next month.

Fortescue Metals’ Andrew Forrest’s Report “Creating Parity” has been developed in parallel. Although its core focus is on Jobs and Training for Aboriginal and Torres Strait Islander peoples, the report is very broad in scope and potentially has wide-ranging ramifications for the design of Australia’s welfare system.

The Government has said both of these reports are being considered together.

Future of Welfare - Cassandra GoldieBoth the McClure and Forrest reports pay considerable attention to employment support. Notwithstanding this, the Australian government has recently announced the design of the new model for Employment Services and the return-for-tender process is now underway.

Work for the Dole represents a major focus of the new arrangements. Targeted employment subsidies attached to hiring young and older people are a new policy feature. So too are financial rewards (a Job Commitment Bonus) for young people who can retain work over an extended period or for those who relocate to certain areas to take up opportunities.

Specialist services are not a feature of the new Employment Services arrangements – so we are not expecting to see services taking a youth specific approach despite the high number of young people who are currently unemployed, underemployed or completely disconnected from work or study.

Some of the more drastic budget measures directed at young jobseekers have not been able to pass through the Senate so far – like the imposition of waiting periods for income support for some young people, and raising the age of eligibility for Newstart to 25.

Future of Welfare - Nicholas BiddleNor have significant changes which will see a decline in the real value of pensions over time or an extension of the expected retirement age to 70 years. But these issues are bound to be revisited given our budgetary challenges and changing demographics.

There has been an ongoing review of the Vocational Education and Training System. This has been coupled with increasingly restrictive State administered rules about eligibility for training subsidies and reduced subsidy rates with higher gap payments for learners. The new Employment Services arrangements also wind back training opportunities for jobseekers.

This has largely been a response to the exponential growth of training providers and the resulting diversity of training quality – too many jobseekers are churning through and burning their entitlements to subsidies on training that doesn’t get them closer to work. It is challenging to navigate the training system.

Future of Welfare - Jenny MacklinWe have a growing mismatch between those seeking work and the skills and experience that employers are looking for, and a reliance on skilled migration.

The emphasis on training expenditure through the new Industry Skills Fund is for those already in work.

Perhaps a bit more tangential is the Productivity Commission’s Report into early years education and care, which was sent to the Australian Government on the 31st of October. If recommendations outlined in the draft report are picked up, families who are not working, or who are precariously attached to the workforce (as so many are) will be shut out of receiving subsidised child care.

Some of the other major activity on the horizon includes the Competition Policy Review being headed by Ian Harper – which amongst other things recommends the application of competition policy to the delivery of human services.

There’s also the tax review, the review of federalism, the review of housing and homelessness, and a review of workplace relations coming up, the roll-out of the NDIS and the question of what will happen to the Gonski recommendations. These all intersect with welfare.

Perhaps that helps explain why there was such a busy and rich agenda at this conference.

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