Parliamentary Library wcag

Mutual Obligation/Work for the Dole

E-Brief: Online Only issued 27 November 2000, updated 15 June 2004

Peter Yeend, Analysis and Policy
Social Policy Group

What is in this e-brief

Terms such as 'mutual obligation' have emerged in the welfare context both in Australia and internationally over the past decade. However, mutual obligation has grown to mean different concepts in different countries. This e-brief provides information about Mutual Obligation and Work for the Dole (WfD), as it has evolved in the Australian welfare context since 1996. The e-brief provides the evolution of these terms by way of a chronology of their introduction and development. There are also links to comments and positions held by the major political parties and major community representative organisations in Australia. Finally, there are links to public comments in Australia and also to some overseas experiences with mutual obligation.

Mutual Obligation in Australia

In the context of welfare assistance in Australia, Mutual Obligation is based on a concept that welfare assistance provided to the unemployed of working age should involve some return responsibilities for the recipient. To date, in Australia this has meant unemployed job seekers on newstart and youth allowance should:

actively seek work
constantly strive to improve their competitiveness in the labour market
give something back to the community that supports them

Mutual Obligation has not yet been extended to other unemployed of working age receiving welfare assistance, eg. sole parents, people with disabilities. However, mutual obligation for these and other groups is being debated in the context of the Welfare Review. See also the e-brief on the Welfare Review.

Jobseekers formally required to meet Mutual Obligation requirements

Jobseekers formally required to meet Mutual Obligation activity requirements are those who are:

18 - 24 years old and have been getting newstart or youth allowance for six months; or
25 - 34 years old and have been getting newstart allowance for 12 months.

Jobseekers are considered to be meeting their Mutual Obligation requirements when they are undertaking one of the accepted 'activities'.

Accepted Mutual Obligation activities

Part-time paid work
Work for the Dole
Community Development Employment Projects
Voluntary work
Green Corps
Relocation
Approved Literacy and Numeracy Training
Part-time study

New Apprenticeships Access Programme
Job Search Training
Advanced English for Migrants Programme
Intensive Assistance
Jobs Pathways Programme
Job Placement, Employment and Training programme
Career Counselling

More information about the participation requirements for these activities can be found at the Mutual Obligation Centrelink web site.

Work for the Dole (WfD)

One of the main planks or features of the government's emphasis on welfare assistance having Mutual Obligation elements has been the WfD program. WfD is a Government funded program that provides work experience opportunities and activities for eligible job seekers. WfD involves local communities in activities that provide work experience for the unemployed, designed to help the unemployed re-attach to the labour market. WfD is also designed to provide communities with quality projects/ activities, which are of value to those communities. WfD projects are designed to not cross over or to take jobs away from existing full-time or part-time workers.

Participants are expected to undertake their work experience in one or more WfD projects/activities for a period of six months. WfD participation is an approved activity for Mutual Obligation.

WfD projects

WfD Projects can cover a wide range of activities in such areas as:

heritage or history
the environment
community care
tourism
sport
provision of community services
restoration and maintenance of community facilities

Jobseekers that can be required to participate in or can volunteer for WfD

Jobseekers can be asked or can volunteer for WfD if they are a:

18 - 19 year old Year 12 school leaver who has been receiving Youth Allowance as a jobseeker for three months;
18 to 39 year old jobseeker who has been receiving Newstart Allowance or Youth Allowance for 6 months or more.

In addition, jobseekers who are 18 years old or more and receiving the full rate of Newstart Allowance or Youth Allowance may volunteer to participate in WfD.

More information about WfD can be found at the Australian Workplace website.

Mutual Obligation and WfD - Chronology of Events

Opposition tables WfD proposal 1 April 1987	Mr Neil A Brown, MP – then Deputy Leader of the Opposition, submits a proposal to discuss 'Work for unemployment benefits' as a matter of public importance before the House of Representatives. The coalition parties commit themselves when in government to introducing a scheme of compulsory work for the dole. (House Hansard, 1 April 1987 Discussion of Matter of Public Importance – Compulsory Work for Unemployment Benefits, pg. 1876).
Opposition Leader announces WfD principle 13 December 1988	The Hon. John Howard, MP – then Leader of the Opposition, announces that the next Liberal and National Party Government will establish a "Community Service Scheme". The scheme is to "provide a real and genuine benefit to the unemployed through work experience and training; satisfy general community desire to see the unemployed have the benefits of active work; reduce abuses in the payment of unemployed benefits and encourage the voluntarily unemployed to secure genuine employment." Media Release No.L109/88 – 'Working for Australia: An Active Approach to Unemployment'.
WfD Legislation introduced to Parliament 19 March 1997	Federal Minister for Schools, Vocational Education and Training, The Hon. Dr David Kemp, MP - introduces the legislative framework for WfD to Parliament. Media release No. K10/97 - Work for the Dole Legislation.
WfD Pilot announced 13 May 1997	A 12-month WfD pilot scheduled to commence from September 1997. The pilot is funded at $21.6 million and will enable 10,000 participants, between the ages of 18 and 24, who have been unemployed for at least six months, to take part in the pilot. Media release No. K24/97 – Work for the Dole Initiative.
WfD Pilot commences 3 December 1997	A total of 22 WfD projects commenced by 3 December 1997 with more than 300 participants. Media release No. K82/97 – Work for the Dole Starts Today.
Enhanced Mutual Obligation Requirements 28 January 1998	Enhanced Mutual Obligation arrangements announced for 18 to 24 year olds. From 1 July 1998 all young unemployed people who have been receiving unemployment payments for six months will be required to undertake an additional activity in return for receiving payments. Media release No. K4/98 – Unemployed young people to take responsibility for their own future.
WfD Pilot expanded 14 April 1998	New WfD projects announced to start between August 1998 and February 1999. These projects are expected to involve 25,500 participants. Media release No. K23/98 – New Work for the Dole Projects.
Formal Mutual Obligation requirements announced 12 May 1998	The Government announces it will spend $465.5 million over the coming four years to assist young unemployed people find work. Key elements of the package are: Expansion of work for the dole New literacy and numeracy programmes Additional places for young people under Job Network New career counselling programs. Media release No. K36/98 - $465.5 million to assist youth to find jobs.
New Mutual Obligation requirements start 1 July 1998	All 18-24 year olds who have been unemployed for six months or more must participate in an additional approved activity in order to receive full unemployment benefit. Media release No. K52/98 – New Mutual Obligation Requirements Start Today.
301 new WfD projects 26 July 1998	WfD pilot expanded with the announcements of 301 new WfD projects and project conditions. Media release No. K57/98 – 301 New Work for the Dole Projects
Second round of WfD projects announced 18 December 1998	The Government provides an extra $20 million to fund more than 388 new WfD projects. The new projects will provide 13,000 places. 80% of will be for those aged 18-24 years, the remainder of places will be available for older unemployed people. An additional $100 million over four years announced to fund WfD places for Year 12 school-leavers. Media release - $20 million for 13,000 new Work for the Dole Places.
Government compare WfD with 'Working Nation' 17 February 1999	Comparison of cost of WfD program for employment outcomes against Working Nation. Media release – Work for the Dole working for the unemployed.
Third round of WfD programme launched 24 March 1999	New WfD projects to start between August 1999 and February 2000 expected to create an additional 15,000 places. Media release – New Work for the Dole Projects.
WfD expanded to include Year 12 school-leavers 19 April 1999	Expansion of access to WfD for Year 12 school-leavers who have been unemployed for three months or more. Media release – Work for the Dole Expanded to include Year 12 school-leavers.
WfD Evaluation Report released 26 May 1999	An evaluation of the WfD pilot program prepared by the Department of Employment, Workplace Relations and Small Business released 26 May 2000. Media release – Work for the Dole: It's working for Australia. The evaluation report is available, see - Evaluation of the Work for the Dole Pilot Program.
Administration of WfD projects to be tendered to Community Work Coordinators 11 June 1999	WfD program expansion enhanced by the introduction of community based work coordinators.
Third round of WfD projects 13 July 1999	Government commits $32 million for nearly 700 new WfD projects. This will create nearly 20,000 places over the coming six months. Media release - $32 million for 20,000 new Work for the Dole places.
Minister Abbott spells out aims and objectives of WfD 5 August 1999	Minister Abbott explains why WfD is good economic policy. Media release - Abbott Tells Ceda Why Work For The Dole Is Key Component Of Good Economic Policy.
Government announces major Social Policy Reform agenda 29 September 1999	Minister Newman announces that social policy is the next major reform priority of the Government, this includes a stronger framework of mutual obligation.
WfD 2000 launched 17 December 1999	119 organisations given conditional offers of business under the WfD 2000 tender. The Government commits nearly $139 million to create additional 65,000 places in WfD projects. Media release - $139 Million For 65,000 Places Under Work For The Dole 2000.
Mutual Obligation requirements modified to encourage Olympic work 23 February 2000	Media release No. 00/12 - Sydney Jobs In 2000.
Preparing for Work Agreements 2 March 2000	The Government launches Preparing for Work Agreements as an important part of its Mutual Obligation strategy. Media Release - Getting Job Seekers Back To Work.
430 new WfD projects 16 May 2000	The third round of WfD 2000 projects announced, creating another 6,069 places for eligible job seekers. Media release 00/33 - 430 New Work For The Dole 2000 Projects.
238 new WfD projects 15 June 2000	The fourth round of WfD 2000 projects announced, creating another 3,833 places for eligible job seekers. Media release - 238 New Work For The Dole Projects.
240 new WfD projects 12 July 2000	The fifth round of WfD 2000 projects announced, creating another 4,005 places for eligible job seekers. Media release - 240 New Work For The Dole 2000 Projects.
Olympic Employment Initiative 14 July 2000	Government extends Mutual Obligation to job seekers in Sydney who have been unemployed for three months or more. Media release - Extra Assistance To Jobseekers In Sydney.
Study confirms success of WfD 26 July 2000	Evaluation of WfD by the Department of Employment, Workplace Relations and Small Business claims that the WfD program has a positive impact on gaining employment or entering education or training. Media release - Study Confirms Success Of Work For The Dole.
WfD Net Impact Study released August 2000	Study of WfD by the Department of Employment, Workplace Relations and Small Business claims that the WfD program participants have a significantly enhanced result in terms of accessing employment, education or training. See - Work For the Dole: a Net Impact Study.
WfD expanded to include participants aged to 39 years December 2000	Government expands Mutual Obligation from July 1, 2002, introducing WfD for unemployed people aged 35-39 and making involvement optional for job seekers aged 40-49 years. Media release - Government to Expand Work For The Dole.
ANAO releases report on management of WfD 7 March 2001	The Australian National Audit Office (ANAO) releases report - Management of the Work for the Dole Program. The report found that administration of the Programme had been generally efficient and effective but made recommendations regarding the Community Work Coordinators Administrative model and contract monitoring.
Over 5000 WfD projects approved since 1997 21 June 2001	Since the pilot round in 1997, 5 714 WfD projects have been approved, providing places for nearly 130 000 Australians. Media release - Thousands more Work for the Dole opportunities.
National total for WfD projects reaches 8544 1 April 2002	The national total of WfD projects reaches 8544 and nearly 172 000 places. Media release - Work for the Dole passes 1500 project mark in Queensland.
Government introduces Training Credits 1 July 2002	Work for the Dole placement will qualify job seekers for Training Credits of up to $800. Media release - Work for the Dole Passes 9000 Projects.
UNSW Study on WfD published 2003	The Centre for Applied Economic Research at the University of New South Wales publishes study: Work for the Dole - Obligation or Opportunity. The study found that WfD does help participants find jobs; Departmental guidelines reduce felxibility and autonomy; and the program is underfunded. Parliamentary Library Cat No. 331.137994NEV
15 535 WfD approved across Australia since 1997 11 December 2003	Since 1997, 15 535 projects across Australia have offered 261 929 opportunities for unemployed Australians. Media release - New and Varied Work for the Dole opportunities.
Independent Study evaluates WfD December 2003	The study, Work for the Dole - A pathway to self-esteem and employment commitment, or the road to frustration?, carried out by independent researchers from the University of South Australia and the University of Melbourne finds that the WfD program fails the most disadvantaged jobseekers.
17 538 WfD projects approved across Australia since 1997 26 May 2004	Since 1997, 17 538 projects across Australia have offered 285 639 opportunities for unemployed Australians. Media release - Work for the Dole Working for the Nation.

Comments from major Political Parties

Australian Democrats

WfD does not create jobs 13 May 1998	Democrat position on WfD is that it does not create jobs. Media release 98/296 - Where are the Jobs?
Democrats demand WfD guarantee from Government 17 December 1999	Democrats call for the government not to reduce mutual obligation waiting periods. Democrats claim that forcing job seekers straight into mutual obligation and WfD activities decreases their opportunity to seek work and does not give job seekers the opportunity to seek work independently. Media release No. 0713nsd - Democrats demand Work for the Dole guarantee from Scrooge Government.
WfD marginalises the most disadvantaged job seekers 17 December 1999	Democrats criticise Mutual Obligation and WfD. The criticisms are: discriminates against the most disadvantaged job seekers there's been no assessment of the real effectiveness of WfD in general expanding WfD is anti-worker puts downward pressure on the wages and conditions of lower paid workers Media release No. 0712ab - Work for the Dole, anti-welfare, anti-worker: Another peek at Howard's welfare 'reform' agenda
WfD forces the unemployed through the motions of work 12 May 1999	Media release - Work for the Dole extension a cruel hoax on jobseekers.
More funding for intensive assistance not WfD 7 August 2000	Democrats criticise the government for reducing the Intensive Assistance program by $80 000 to be used to expand the WfD program. Media release No. 00469 Job Network Reform: fund Intensive Assistance, not Work for the Dole.

Australian Labor Party

WfD doesn't measure up to Labor Jobstart Wage Subsidy Program 12 April 1999	Criticism that the government is diverting funding away from unemployment issues. Media release - Enough Bluff - What About Jobs?
Labor would modify WfD 25 July 1999	Mr Martin Ferguson, MP, then shadow Minister for Employment, Training and Population, stated that the ALP would change WfD so that there is a stronger focus on training and work skills. Meet the Press' transcript.
Mutual obligation is a one way street. WfD is not the answer 17 December 1999	Mr Wayne Swan, MP, shadow minister for Family and Community Services, is critical of Governments welfare strategy. Media release - The Great Welfare Charade.
Government not capable of striking balance between incentive and compulsion 17 December 1999	Doorstop interview with the Leader of the Opposition, the Hon. Kim Beazley, MP about WfD and mutual obligation.
OECD says WfD fails to provide the real work experience that employers are looking for 21 December 1999	Media Release - OECD Says Regional Australia Deserves Better Than Work For The Dole.
Labor would change WfD 10 July 2000	Ms Cheryl Kernot, MP - ALP spokesperson for employment, stated that Labor would not scrap WfD, if elected, however they would modify WfD in order to provide young people with more meaningful outcomes. See Radio National transcript - Job Network, Work For The Dole.
Mutual Obligation is a cost saving measure 26 July 2000	Mutual obligation isn't about helping people find jobs, it's a way to contain the welfare cost blowout. Media release - So Far, Abbott's Way Is More About Punishment Than Partnerships.
Old Labor scheme reintroduced 14 May 2001	Labor says allowing WfD participant's access to training under the new 'transition banks' scheme is a renaming of Labor's 'Earning Credit Scheme' which was abolished in 1997. Media release - Training Reversal for Work for the Dole.
Labor releases WfD figures 6 March 2004	Labor figures show that WfD program achieved consistently poor employment outcomes for jobseekers. Media release - "Work for the Dole" helps fewer and fewer into a job.

Comments from Peak Community Representative Groups and Organisations

The Australian Council of Social Service (ACOSS)	ACOSS has expressed some views about the WfD program: "Work for the Dole is a deeply limited program that is not even designed to improve the employment prospects of unemployed people." Other ACOSS comments have been: there have always been requirements on people receiving unemployment payments to undertake certain activities. there is no training component in the program, meaning many participants will not acquire transportable and accredited skills there is no mechanism to ensure that the activities undertaken by individuals are appropriate for them and will improve their job readiness the program singles out one group – young people – among all of those who are unemployed and in so doing, potentially exacerbates misconceptions in the community about the willingness of young people to work. For more information see ACOSS briefing paper. New paternalism: the demise of rights-based welfare, an article by Dr Deborah Brennan in the ACOSS monthly IMPACT – July 2000, page 8 (S361.994 AUS). "The government's policy of Mutual Obligation is an example of a new conservative approach to social policy. This approach potentially marks the demise of a rights-based welfare system."
Brotherhood of St Lawrence 28 January 1998	Bishop Michael Challen, Executive Director, Brotherhood of St Laurence made some comments about WfD in its response to the Prime Minister's proposals for young unemployed people in his First Annual Federation Address – Jan 1998. Media release - Response to the Prime Minister's proposals for young unemployed people in his First Annual Federation Address. Challen provided further comment on WfD in a media release on 24/7/1997 - Compulsory 'Work For The Dole' Scheme Will Generate Resentment Among The Young. Brotherhood of St Lawrence Submission to the Community Affairs Legislation Committee 14 April 1997 argued that the resurfacing of WfD policy is disturbing for three reasons: the language of 'the dole' is a step back into history the proposal ignores many useful programs through which the Government could assist young unemployed people WfD will have negative consequences both for individuals who are compelled to participate and for their sponsoring organisations.
Australian Youth Policy and Action Coalition (AYPAC)	AYPAC set out some views on WfD in a Policy Statement and also in a Supplemental Submission to the Senate Community Affairs Committee. The AYPAC stated view on WfD is: "a response to declining youth labour market that should include a compulsion that young people participate in programs that force them to perform work for continued receipt of income support should be rejected" AYPAC further claimed WfD programs do not provide a solution to the central problem, ie. a lack of real sustainable jobs that will provide an independent living income. Also, WfD does not solve youth unemployment, rather it forces young people to perform work no one else wants to do for below poverty line income.
NSW Council of Social Services (NCOSS)	NCOSS expressed views on Mutual Obligation in a Media release - Make a genuine future, not a living hell for Young People, on 29 January 1999. The NCOSS view was that the Government's notion of mutual obligation, particularly with young people, is more about punishment of those who are the victims of the last decade of economic reform in Australia, rather than reciprocal partnership with the Australian community.

Further Comment and the Overseas Experience

Community attitudes towards unemployment, activity testing and mutual obligation Tony Eardley, Peter Saunders & Ceri Evans, 2000.	A discussion paper containing the results of a community survey was produced by the University of New South Wales Social Policy Research Centre (No. 107, May 2000) - Community attitudes towards unemployment, activity testing and mutual obligation.
Socialist Equality Party	WfD has nothing to do with creating jobs, or maintaining the morale of the unemployed, but is bound up with the provision of cheap labour, and the further erosion of wages and conditions. Media release - The real meaning of work-for-the-dole - March 21 – April 4 1997.
Working for the dole: Making young people responsible OR blaming the victims Bronwyn Pike - Evatt Victoria Centre, 1997. (331.137994 p WOR)	Bronwyn Pike puts her view in this article that WfD places unfair pressure on the unemployed as it tells them 'you owe us'. She also argues that WfD may provide a pool of free labour and replace existing jobs.
Helping the poor: A qualified case for 'Workfare' John Richards et al, C. D. Howe Institute, 1995. (362.580971 HEL)	"Canadian governments are spending a lot of money on welfare, with dubious results". This book looks at current welfare programs and assesses their effectiveness. The book compares Canada's policies to those in the USA and includes a chapter about 'Putting the poor to work: Why workfare is an idea whose time has come'.
Workfare: Does it work? Is it fair? Patricia Evans et al, Institute for Research on Public Policy - Canada, 1995. (362.582 WOR)	The notion of linking welfare payments to participation in public work or training programs is at the forefront of debate in Canada, the USA and Europe. This book explores the moral principles and politics of workfare, and looks closely at the Canadian debate.
Employment and Training Schemes for the Unemployed Julia Lourie, Business and Transport Section, House of Commons Library, 1997. (ANAL S 909.09 RES)	This research paper provides an account of the main employment and training schemes that exist in Britain in 1997/98. It also contains brief notes on schemes that have been tried since WWII.
Actively seeking work? Desmond King, The politics of welfare and unemployment policy in the United States and the Great Britain, University of Chicago Press, 1995. (331.137941 KIN)	This book called - Actively seeking work? provides an analysis of the programs of unemployment and workfare in Britain and the USA, and explains their politics.
Diagnosis is a bitter pill for community Dr Bettina Cass, the Australian newspaper. 18 August 2000	Dr Bettina Cass wrote in the Australian on 18 August 2000 about mutual obligation issues arising from the Welfare Review considerations of welfare reform. "welfare reform will focus on 'social partnerships', but a large number of the most disadvantaged may find themselves sitting in the most troublesome and problematic position in these partnerships."
The Australia Institute Working Australians should be grateful to the unemployed: new report 14 August 2000	The Australia Institute issued a media release on 14 August 2000 - Working Australians should be grateful to the unemployed: new report, which referred to a research paper by Dr Pamela Kinnear that the Howard government's mutual obligation principle does not stand up to ethical scrutiny.
Mutual obligation: what kind of contract is this? Anna Yeatman Australian Institute of Family Studies, Peter Saunders 2000. (R 361.680994 Ref)	In a book called 'Reforming the Welfare State presented by Peter Saunders, Chapter 7 by Anna Yeatman is called 'Mutual obligation: what kind of contract is this?' and discusses: Mutual obligation and the new paternalism Mutual obligation as a cluster of values A paternalism contractualism? Reconciling paternalism with individualism Mutual obligation evaluated
Mutual obligation: policy and practice in Australia compared with the UK Richard Curtain for the Dusseldorp Skills Forum. 20 July 2000	Discussion paper presented by the Dusseldorp Skills Forum presenting an assessment of how the concept of mutual obligation is implemented in Australia compared with the United Kingdom - Mutual obligation: policy and practice in Australia compared with the UK.
Social welfare and individual responsibility - for and against David Schmidtz and Robert E Goodin, Cambridge University Press, 1998. (361.610973 SCH)	This book is a very broad ranging discussion across social welfare issues discussing responsibilities of the State and the individual, and touching on issues such as morality of incentives and deterrence, concepts of welfare justice and can you apportion fault to welfare recipients.

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Mutual Obligation/Work for the Dole