Mixed messages in new Turnbull Budget

09 May 2017

Some good news, but compliance regime raises worries for vulnerable

Delivering the Coalition Government's fourth Budget, Treasurer Scott Morrison cites principles of fairness and opportunity. The Brotherhood of St Laurence believes the fairness test is met when substantial action is taken to build the capacity of disadvantaged job seekers to fully participate in the modern economy and opportunities, in turn, are created to help them transition into work. On this test, there are mixed messages in this Turnbull Government Budget.

The integrity of our welfare system is important, but this does not necessarily mean that people are taking “an easy ride”. We are concerned about the proposed new Jobseeker Compliance Framework arrangements announced tonight, and the withdrawal of income support for vulnerable people that would follow in a new tiered demerit system.

“We know from our experience working with highly disadvantaged people that the challenges they face are much more complex than is being portrayed,” said the Brotherhood's Executive Director, Tony Nicholson. “The risk is that the proposed demerit system, devoid of administrative discretion and not accounting for a full understanding of individual circumstances, will cause increasing levels of homelessness through reduced and cancelled payments. For example, we know that about half the homeless people sleeping rough on our streets are unemployed and rely on unemployment benefits. Payment rates are very low so they can't cover spiralling rents in our cities, let alone look for work and comply with Centrelink job search requirements.”

Mr Nicholson said he was also puzzled by the rationale for the proposed trial of American-style random drug testing for new welfare recipients, saying that in his experience any drug use was readily identified and dealt with appropriately as part of the task of preparing people for work. On the other hand, incorporating drug and alcohol rehabilitation programs into job plans as a valid step towards employment was welcome, he said.

Mr Nicholson noted several new changes to the operation of the welfare system including expansion of the activity test for job seekers from 30 to the age they become eligible for the Age Pension, and a merged Job Seeker Payment to replace several current payments. "The system as a whole has been struggling with Centrelink’s automated debt recovery mechanism. I hope it will be able to cope with these new demands and that they will prove effective in assisting people into work,” he said.

“I can assure Australian taxpayers that unemployed people know - better than anyone - that securing stable work is the pathway to building a good life in our country. They are certainly not 'dole bludgers'; they are hungry for work and opportunity.”

Employment programs heading in right direction

In this context, Mr Nicholson said he was encouraged by several measures in the employment portfolio, including the $263 million expansion of the ParentsNext program and the $55.7 million Indigenous Employment package. Establishing a new Career Transition Assistance Program was also a positive measure that would help disadvantaged mature people displaced by the globalised modern economy, he said.

“Poverty and disadvantage that persist in our otherwise prosperous country not only hurt the people directly affected, they are bad for the economy, and also hurt us all,” Mr Nicholson said. “We need to invest in our most disadvantaged people to build an inclusive Australia, one that complies with a foundational principle of our society: a fair go for all.”

Media inquiries: Brotherhood Communications on 0499 300 982

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