Saving the long term jobless

The Welfare Rights Network similarly argues that “people are work willing but they are not work ready”, and that welfare recipients are being pushed into short-term jobs rather than training for sustained careers.

The CEO of Job Futures, an alliance of welfare groups, joins this chorus by complaining that, “Employment outcomes seem at times to be the sole driver of the system … many of those who have been referred to these programs in the past require a great deal of support in dealing with personal issues before they are ready to join an employment program.” And the National Employment Services Association says there should be more emphasis on “proper” skills training rather than rapid placement into jobs.

If this sounds like an orchestrated campaign, that’s because it is. Influential sections of the welfare lobby have for years been trying to weaken or undermine the primary emphasis on work requirements which drives the Job Network model and the “mutual obligation” policy which it embodies, and they are seizing on the change of government in Canberra as their opportunity to push their case.

Up until now, their main target has been the financial “breaching penalties” imposed on claimants who persistently fail to meet their activity requirements. Many welfare groups think these penalties are too harsh. They say no penalty should last more than eight weeks, no payment should be reduced by more than 25 per cent, and there should be no penalty at all in cases where financial sanctions might cause “hardship”. Never mind that if they were ever implemented, these proposals would fatally undermine the whole system of “mutual obligation” (for claimants who were willing to settle for a lower payment could completely disregard their activity responsibilities, and nothing more could be done to force them to comply).

Many welfare groups would be quite happy to live with this, for they have never embraced the principle that welfare payments should be conditional on the performance of certain tasks. For them, welfare is a right, and it should be paid unconditionally to people who are in need of it.

The trouble is, many of these same welfare organisations are fully signed-up members of the Job Network, which means they are committed to implementing a conditional welfare system. They are contractually obliged to find work for the unemployed people who are sent to them, and they are required to inform Centrelink of any cases where claimants fail to discharge their obligations. This means they are part of a system which they do not believe in, and for years, they have been wriggling to get off this hook.

Not-for-profit organisations make up more than half of the Job Network’s members. The two biggest members of the network are the Salvation Army (with a 15 per cent market share) and Mission Australia (8 per cent), but they are not the only non-profit organisations which have come to depend on government contracts. The Salvation Army, Centacare, Mission Australia, and Wesley Uniting Employment together rely on Job Network contracts for one third of all their income. Inevitably they feel compromised, for to varying degrees they are all accepting government payments to implement policies with which they are unsympathetic.

Not only has the autonomy of the “voluntary sector” been compromised by these contracts, but the government’s policies have to some extent been undermined by the existence of a Trojan Horse within the heart of its Mutual Obligation citadel. While they have continued to operate within the Job Network system, the welfare organisations have never felt comfortable implementing the “Work First” policy the Howard government demanded of them, and the result is that they have implemented it half-heartedly.

A 2002 Productivity Commission report found, for example, that non-profit Job Network members were underreporting breaches by 12 per cent as a result of their reluctance to report claimants who failed to fulfil their mutual obligation requirements.

More recently, after the government extended work requirements to single parents with children over six years of age, the welfare organisations agreed to operate a new Financial Case Management Scheme, designed to monitor families where breaching penalties had been imposed and to dispense special payments where there was evidence of hardship affecting children. But no sooner had they joined this scheme than they started publicly attacking it, and eventually 12 of them reneged on their agreement, arguing that any breach penalty imposed on single parents was “immoral” and they wanted nothing more to do with it.

It is against this context that we have to understand the latest round of complaints from welfare organisations involved in the Job Network. First, they attacked breaching penalties, then they criticised work requirements for single parents, and now they are claiming that people remaining on welfare are not “job ready” and should not be required to work. The common theme through all of this has been that work requirements should be weakened.

Why are these organisations so concerned to undermine the main plank of the last ten years of welfare policy? Basically, because their traditional instinct is to help people in need, not to penalise them. Ever since they got embroiled in the Job Network, however, they have been acting more as arms-length agencies of government than as autonomous charities. Their desire to help people has been subverted by their contractual duty to coerce them into work and other activities. They are now too dependent on government money just to walk away from these contracts, so they are hoping they can change the terms of their agreement with the government, to bring their tasks more into line with their traditional values and ethos.