Welfare Reform

Aside from IR, the big issue Cabinet will be discussing today is welfare reform. A single payment, which I support, is still too difficult according to Minister Kevin Andrews. One reason might be, as the Fin reported yesterday, that there is no portfolio of Social Security anymore, and responsibility for policy and payments is now split among five departments and five Ministers. Let’s hope they’ve got that whole of government thing happening well. It’d be nice as well to see the issues of disincentives to work addressed, and as I’ve argued before, great to see the many government benefits which proliferated again in the last election dealt with other than as proliferating inequities and confusions in the tax system.

One under-noticed aspect of the welfare reforms that are already in train is that major responsibility for assistance to people applying for the DSP is mooted to be transferred to job network agencies. Many people on DSP suffer from mental illnesses, although the perception in the media is that it’s all blokes in their 50s with crook backs. There are so many negative reports about the performance of job network agencies, and indeed of the qualifications and professionalism of some of their employees, that I really hope that this is done properly. In effect, what we’re about to see is a second round of outsourcing of welfare services to profit-making and not-for-profit organisations. This has only been noted in the media through reporting of statements by Employment Services Minister Peter Dutton, but has yet to be put in its proper context of a fairly sweeping privatisation and outsourcing of welfare ane employment services. This deserves more debate than it’s currently attracting.

ELSEWHERE: Andrew Bartlett writes passionately about mental illness and the DSP reforms.

About Mark Bahnisch

Mark Bahnisch is a sociologist and is the founder of this blog. He has an undergraduate degree in history and politics from UQ, and postgraduate qualifications in sociology, industrial relations and political economy from Griffith and QUT. He has recently been awarded his PhD through the Humanities Program at QUT. Mark's full bio is on this page.
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Paul Norton
Paul Norton
2022 years ago

Andrew Bartlett wrote on his blog that:

“Public debate over the last few weeks should have made clear how much of a stigma mental illness carries and how damaging this can be to sufferers. Try adding a good dollop of public antagonism, tacitly endorsed by the nation’s leaders, and see what that does for your mental health.”

Indeed. I would also add that being subject to constant bureaucratic surveillance by Centrelink and/or one of its outsourcees, and knowing that one could be plunged into destitution as a result of failing to jump over whatever bar Centrelink or the Job Network sets, is also not designed to improve one’s mental health.

Also, many people with mental health problems who are not considered sufficiently disabled to qualify for the DSP, or whose condition is undiagnosed, nonetheless experience serious labour market disadvantage as a result of their illness, forcing them into dependence on Newstart for extended periods, and also therefore subject to surveillance and micromanagement of their lives by Centrelink and/or the Job Network. I would hazard a guess that the number of people in this plight may be as great or greater than the number of those in receipt of DSP.

Paul Norton
Paul Norton
2022 years ago

Another group of people that are not noticed in debates about “welfare reform” are the non-trivial number of people in highly variable and/or seasonal casual employment whose income from paid work in their field is either not sufficient or not secure enough to enable them to get by without some support from the Newstart Allowance.

As a result, sooner or later (and these days it’s sooner) they find themselves being called in by Centrelink and/or the Job Network to engage in the equivalent of finger-painting and sandboxes for adults, on the official rationale that this will improve their employability. In fact such calls on their time may well be disruptive of their existing work.

In some cases these people are engaged in a combination of insecure work and a course of study or training which, taken as a whole, represents their best hope of improving their employability, and which is far more useful than anything the Job Network might be able to provide. The time and activity demands of the Job Network sandbox have the potential to completely disrupt this career track, especially if Centrelink insists that the hours in the sandbox be at the expense of study or training of the person’s choosing.

Paul Watson
2022 years ago

Paul Norton’s comment took the words right out of my mouth (something that very rarely happens, I can assure people who don’t know me).

All I can add is a bit more edge and provocation: long-term unemployment is *itself* bound to cause mental illness, for all bar the tiny percentage of people who can happily (i) live on $200/week, with (ii) unlimited free time. That may cover a few surfing ferals, but not the vast majority of long-term unemployed.

Geoff Honnor
Geoff Honnor
2022 years ago

“Many people on DSP suffer from mental illnesses, although the perception in the media is that it’s all blokes in their 50s with crook backs”

ACOSS 2004 data tells us that around 33% of DSP recipients are in the broad musculo-skeletal disability area and older blokes with crook backs ARE disproportionately represented – 35% of all recipients are men aged over 50. This is not surprising. A lifetime of manual labour in sunset industries will tend to give you a crook back. I’m not sure what you retrain a 58 year old ex-miner in a town up the Hunter to do – and neither is the Job Network. They don’t have to worry. They make many on referrals not on whether they achieve some sustainable outcome for the guy concerned.

Around 25% of recipients have psychological or psychiatric illnesses, around 10% have intellectual or learning difficulties. The remainder have chronic , disabling conditions and/or diseases illnesses, severe post-accident trauma etc, etc. The largest growth groups through the 90’s have been mature aged women – 20% of all recipients are women aged 50 and over – following the ratcheting-up of the aged-pension qualifying age, and men under 50 (27% of the total), largely from psych conditions/vehicle accidents.

There’s potentially a lot of scope for reform in the broad psych area. The normal response to depressive illness is to prescribe a course of antidepressants with an invitation to return in 3 months – when further pills will be prescribed.
Some Job Network providers (CRS is one) will work with people in these circumstances but it’s often a pretty intensive ask to get a sustainable result.

I should also point out that there’s generally around 50,000 people on Newstart (Incapacitated), i.e. with an illness or disability that doesn’t make the DSP grade.

blank
blank
2022 years ago

The Job Network sand-box does not stop you from studying or training.

You can nominate part-time study as your ‘sand box activity’. Just 6 contact hours a week keeps Centrelink happy, too.

About the same amount of time as a volunteer for a non-for-profit community organisation will also do the trick.

observa
observa
2022 years ago

Well I did raise the prospect of an ‘all hands on deck’ response to an aging population and concomitant worker shortage, in a comment to Gianna some months ago. Seems the pollies have finally cottoned on and as I warned Gianna at the time, sooner or later fit able-bodied single mums would be treated like their married counterparts. Six months off for bub and then back to work quick smart mum. Little did the Observa know how soon his prophetic words would come to fruition.

At long last the partly disabled, long term unemployed, etc are about to become ‘de-marginalised’ by economic demand and demographic factors, which of course should produce a general sense of euphoria for all here. Now why is it I have this sinking feeling that this is really just opening another front in the culture wars? Have ACOSS fired the first shots yet?

Geoff Robinson
2022 years ago

I thought that work in the new economy free of union tyranny was now an endless festival of empowering joy. How come the line is now to force people into the paid workforce? Perhaps lots of the jobs being created by the new economy are shitty (often literally) low-paid jobs (soon to be paid less due to the gutting of the award system). We have here an updating of the old complaint that Australians are reluctant to do domestic service. If there a shortage of labour wages will rise and attract more people into the paid workforce, but the current RBA-enforced line is that any demand-driven wage rises are a bad thing. Any decent economist would know that output gains by increased workforce participation are overstated because they are paid for in part by reduced non-market output. How about considering: 1) the large number of workers who would like to work longer hours? 2) dependents of highly-paid workers? 3)increasing immigration which worked so well in the 1950s.;4) forcing people to spend less time on their investment portfolio; 5) better pay and conditions for low-paid service sector workers?

Don Wigan
Don Wigan
2022 years ago

“ACOSS 2004 data tells us that around 33% of DSP recipients are in the broad musculo-skeletal disability area and older blokes with crook backs ARE disproportionately represented – 35% of all recipients are men aged over 50. This is not surprising. A lifetime of manual labour in sunset industries will tend to give you a crook back” It’s an issue I’ve raised before, Geoff.

I had working experience in the CES as Employment Counsellor and later Disability Jobseeker Adviser. It’s an area of labour market failure and points to the problems of enforcement and monitoring activity.

My experience in the early and mid-90s was that most had injuries or impairments of some sort. In normal circs it wouldn’t have been enough for a DSP, but consider their position:
1. Limited skills, depending on laboring, factory or farmwork.
2. Double the age of others competing for the same (declining in numbers) jobs. Of course employers will prefer younger and fitter options.
3. The injury might not be debilitating, but it will show up in a medical examination. No employer worried about workcover premiums will take a punt on engaging them when others are around.
4. On the other hand, they are expected to be actively canvassing for positions they know they’re not going to get. Keeping up the morale and being positive is a problem in itself.
5. Centrelink and presumably the Job Network (the successors of CES and DSS) are expected to be reviewing their activity and keeping them going. A lot of time consumed for nil result. Mostly, they’ll prefer to concentrate their time on those where they can get a result.

Then, and I suspect now, it was easier to encourage the person to find a sympathetic doctor and put in a medical applying for a DSP. It saved the time of all parties.

Geoff Robinson is right. The stick is only really about appealing to the talkback radio set. It would be far better to try a few more carrots and let market forces do it.

Paul Watson
2022 years ago

“Blank”

blank
blank
2022 years ago

One of the absurdities of the Social Security system is that while you do a Masters or PhD, you are not eligible for income support. Once you have completed either degree, you are not eligible for Austudy Payment ever again.

Anyone who is thinking of doing a Masters should investigate whether it can be structured as a Grad Dip for the first half or so, so as to be eligible for Youth Allowance/Austudy Payment for at least part of the course.

Other degrees ‘expire’ after 10 years, and you can get assistance to do study at the same level.

If you don’t have a Masters or PhD, you can get Austudy Payment for a TAFE course.

Austudy is even less than the Dole (NewStart), and you don’t get any rent assistance.

Can you find an Aborigine in your family tree? Abstudy is available for Masters and PhD.

For volunteering, each state has an organization called “Volunteering + State Name” listed in the White Pages. They have a range of opportunities.

I don’t know where you get the idea that ‘most’ 58 year olds own some real estate outright. The only real estate I own is my home, and at the rate I’m going, it won’t be paid off by the time I’m 58.

Geoff Honnor
Geoff Honnor
2022 years ago

“But when one sees crass, ageist favouritism like Geoff Honour’s, above, at work, one doesn’t exactly feel charitable: “I’m not sure what you retrain a 58 year old ex-miner [with a crook back] in a town up the Hunter to do – and neither is the Job Network”

Mark Bahnisch
2022 years ago

Quick trip to internet cafe to feed blogging addiction – thesis going well :)

On blank’s point, there are scholarships for PhDs (and in theory Research Masters though I doubt anyone would get one) – APAs funded by the government, and most universities offer equivalent schemes. They’re tax free. When I was a full time PhD student, I got $350 a week plus a top-up from my faculty which brought my income to $450 a week tax free. When I did teaching work on top of that during semester, I made quite a nice living.

As Stephen’s pointed out in the past, though, they’re hard to get. At QUT you really need first class honours to qualify, and it seems from Stephen’s experience that at Macquarie you might need a particular gpa in your honours degree as well.

Paul Watson
2022 years ago

A question for Mark:

Do you think it would be dishonest for a person to take the taxpayer’s PhD scholarship coin until it runs out, when s/he has no intention of finishing, or perhaps even substantially doing the thesis?

I ask this because the current structure of much of the academic job market is that of a pyramid/Ponzi scheme, sustained only by increasing layers of ever-more gullible entrants. In 2005, there is no inherent intellectual value in a typical humanities PhD; and any economic value lies solely in its possible use

Mark Bahnisch
2022 years ago

Paul, I think that if people accept a scholarship, they should try and write a thesis, if only because there are others who want to in the queue. The changes to the research degree regime by the federal government are likely to put enormous pressure on people to finish on time (and thus within the scholarship period) because of the way funding is allocated to universities. I don’t think this is a good thing. It’s likely to result in smaller questions, and less challenging or interesting studies. A lot of people I’ve known have taken between 5 and 8 years to do a PhD, and the gains in terms of understanding and insight certainly take time.

Paul Norton
Paul Norton
2022 years ago

“A lot of people I’ve known have taken between 5 and 8 years to do a PhD, and the gains in terms of understanding and insight certainly take time.”

Count me in this category – I was chuffed to be awarded a 1 and a 2 by my examiners (a 1 and a 1 being the best possible result), one of whom is the world’s leading authority on the subject of my thesis, and both of whom were effusive in their judgement of my magnum opus. It can be read at www4.gu.edu.au:8080/adt-root/uploads/approved/adt-QGU20040924.093047/public/02Whole.pdf

Another issue this thread raises is *why* people often don’t complete their Ph.D. theses within the tenure of their scholarship. Reasons can include undiagnosed mental illnesses such as depression, inadequate supervision, choices of research topics which don’t work out for reasons which weren’t forseeable when the project was being designed, greater than expected difficulties balancing candidature with family commitments, and so forth – none of which reflect laziness or other personal inadequacies on the candidate’s part.

Pressure to complete “on time”, as well as leading to the consequences Mark mentions, could lead to other problems such as theses being submitted in a sub-standard state purely in order to meet the deadline, and then being failed, downgraded to M.Phil or required to be resubmitted, or people giving up in despair as the deadline approaches after 2-3 years on the scholarship because they know that the thesis hasn’t worked out and can’t be made to work out in the time available. All in all this would constitute a much greater diseconomy in the form of public resources (and years of people’s lives) being spent to no good end, than the “problem” of people taking longer than originally anticipated to complete their theses.

Geoff Honnor
Geoff Honnor
2022 years ago

“So go on, Geoff, shout *that* from the rooftops, instead of invoking divisive special pleading.”

I have no idea what you’re talking about…

Paul Watson
2022 years ago

Geoff,

I’m not sure what’s so cryptic in the lines preceding those which you don’t understand, but I’ll re-express them, anyway.

The welfare system is broken

Geoff Honnor
Geoff Honnor
2022 years ago

“And if that’s is NOT your view, then you’ve been at pains to hide it, so far.’

No, it’s not my view at all. And I’ve exerted not an ounce of energy in attempting to “hide” what my view is.

derrida derider
derrida derider
2022 years ago

Paul – WTF? I’m as confused as Geoff by what your point is – I can’t even work out whether you are attacking from the right or the left.

What exactly are you trying to say? That older less-educated people are not disproportionately represented in DSP ranks (sorry, but in that case the figures don’t lie)? Or that DSP isn’t a better deal (note “better” is not the same as “good”) for recipients than Newstart currently is?

Alex
Alex
2022 years ago

I think Paul is advocating a guaranteed minimum income, without strings, to avoid stigmatising some categories of welfare recipients and privileging others.

Please correct me if I’m wrong, Paul. BTW, I think you should try driving taxis. It’s a time-honoured occupation for unemployed PhDs.