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What’s happening with the McClure welfare review?


The Government is conducting a review into welfare payments, headed by former Mission Australia CEO, Patrick McClure. This post briefly outlines what is currently known about the McClure review, including its objectives, processes and possible outcomes.

Late in 2013, it was reported that McClure had been asked to provide recommendations on streamlining and improving Australia’s system of welfare payments. While initially it was thought that the review would examine the entire system, the Government clarified that it would only be looking into working age payments such as Newstart Allowance (NSA) and the Disability Support Pension (DSP). Payments such as Age Pension and the various forms of family assistance will not be examined.

Previous McClure review

In 1999, McClure was asked to chair a welfare review for the Howard Government, resulting in the Green Paper, Participation support for a more equitable society. This proposed the transformation of the welfare system into a ‘participation support system’ based around themes such as mutual obligation, simplification and partnerships between government, business and recipients. The purpose would be to better match income support goals (social protection, equity) with social and economic participation goals. A key proposal was for working age payments to be rolled into a single payment, with the possibility of add-ons to assist those with particular needs. Ultimately, the Howard Government did not adopt this recommendation, instead focusing on promoting mutual obligations within the existing payment framework (for example, the 2005 Welfare to Work package).

The process for the earlier McClure review was substantially more open than the current one, which the Government has described as ‘predominately an internal review’. The earlier McClure review had a dedicated ‘Welfare Reform’ website that contained a Government Discussion paper, public submissions, media releases, Terms of Reference, the membership of the Welfare Reform Reference Group and related background papers. The Government advertised for public submissions and received 366 from a variety of sources including individuals, community groups, peak bodies and government agencies. An interim report was made available for public comment in early 2000, followed by the final Green Paper in August 2000.

Current McClure review

In contrast, the current review has no website, no formal terms of reference and no process for receiving public submissions. The Government has not given an indication of whether and in what form the findings of the review will be released to the public.

Most of what is known about the current McClure review is on the basis of responses to questions at the recent Additional Budget Estimates hearings. According to information tabled by the Department of Social Services (DSS), the ‘overarching theme for theme of the Review … is maximising participation for wellbeing and better life outcomes, with the ultimate goal of the welfare system being to support people to participate to the extent they are capable’.

The focus on participation is similar to the previous review. Similarly, the ‘Guiding principles’ and ‘Pillars of reform’ appear to have much in common with the themes of the earlier McClure review.

Guiding principles of the welfare system

Pillars of reform

Provides incentives to work for those who are able to work

Building individual and family capacity

Adequately supports those who are genuinely not able to work

Engaging with business

Supports social and economic participation through measures that build individual and family capacity

 

Building community capacity

Is affordable and sustainable both now and in the future across economic cycles

 

A simpler and sustainable income support system

Is easy to access and understand, and able to be delivered efficiently and effectively

 

 

No call for broader community input has been made. By 27 February 2014, there had been 30 consultations with various stakeholders. Participation has largely been on the basis of invitation, although according to DSS Secretary, Finn Pratt, ‘people have expressed interest in being consulted and have got into the process that way’.

According to Mr Pratt, while there is no formal reporting date, there is likely to be an interim report in the first half of the year and a final report ‘midyear or a bit after midyear’. DSS has budgeted $1.7 million for the review. In addition to McClure, the review team comprises Wesley Aird, Sally Sinclair and a team of 14 departmental officers.

The Minister, Kevin Andrews, has provided some hints in media reports as to what may be proposed by the review. For example, he has asked McClure to examine options for ‘diverting’ people with mental health conditions from receiving DSP into some more temporary income support arrangement. He has made a similar suggestion in relation to young people deemed to have a partial capacity to work.

The Minister has also said that in the longer term, the Government would look to reform the gap between the rate of payment for NSA and DSP, including considering McClure’s earlier proposal for a single working age payment.