ParentsNext is a pre-employment program for people receiving government income support in the form of Parenting Payment.
ParentsNext has been designed with the aim of assisting disadvantaged parents, particularly early school leavers and those assessed to have high barriers to employment, to plan and prepare for future study or work before their youngest child commences school. Parents participating in the program are required to complete and report on activities in a participation plan agreed with a ParentsNext provider.
After a 26-month trial in 10 locations around Australia, the ParentsNext program was rolled out nationally on 1 July 2018. However, in late 2018, media reports started to emerge which questioned whether ParentsNext was meeting its stated aims.
Some parents reported that they had been forced by their ParentsNext provider to attend activities such as library-run 'story time', playgroup or swimming lessons with their children, or instructed to undertake further education at their own expense when they already hold qualifications. Other parents described their frustrations in trying to exit the program after being incorrectly referred. Further reports detailed how parents had their income support payments cut-off unexpectedly under the program's compliance model, including over the Christmas period, placing them and their children at risk and requiring emergency relief.
Half of all households in Australia which receive Parenting Payment live in poverty, with single mothers, who are overrepresented in this cohort, particularly at risk of financial stress. Children living in single parent households are more than three times more likely to grow up in poverty than children in couple families. While placing conditions on recipients of Parenting Payment is not a new concept, these media reports suggest that the design and implementation of the new ParentsNext program has resulted in unintended consequences for these vulnerable parents, particularly single mothers, and their children.
These and other concerns raised by parents and their advocates have been explored by the Senate Community Affairs References Committee (committee) during its examination of the aims, design and implementation of the ParentsNext program.
This report is presented in four chapters:
This chapter provides background and context to the committee's inquiry, outlining the experience of participants in ParentsNext and highlighting the concerns which will be examined in the report.
Chapter 2 examines the history, aims and design of ParentsNext, including human rights concerns and its suitability for vulnerable participants, and discusses the program's pre-employment focus.
Chapter 3 addresses evidence about the administration and implementation of ParentsNext by government departments and contracted service providers.
Chapter 4 provides the committee's conclusion and recommendations.
How ParentsNext works
ParentsNext was first introduced as a trial pre-employment program to provide early intervention assistance to parents with young children. The Explanatory Memorandum for the Social Security Specification which defined who would be eligible for the trial program described that:
ParentsNext will target a cohort of parents identified as having high levels of labour market disadvantage... ParentsNext aims to assist this new cohort to prepare for and ultimately participate in the labour market to help prevent long-term and intergenerational welfare reliance.
The trial of ParentsNext ran from 4 April 2016 to 30 June 2018 in 10 local government areas (LGAs), during which participants were required to attend scheduled appointments with a ParentsNext provider, contracted by the then Department of Employment, and agree on and complete activities in a participation plan in order to receive their Parenting Payment.
In the 2017–18 Budget, it was announced that the Australian Government would provide $238 million over four years to expand the ParentsNext program nationally.
The Australian Government has outlined that the three aims for the national expansion of ParentsNext are to:
reduce welfare reliance and intergenerational welfare dependency;
increase female labour force participation; and
help close the gap in Aboriginal and Torres Strait Islander employment.
The national expansion of ParentsNext began on 1 July 2018, following introduction of the Social Security (Parenting payment participation requirements – classes of persons) Instrument 2018. Following debate, a motion to disallow this instrument was negatived by the Senate on 13 September 2018.
The instrument specified two new classes of ParentsNext participants: Targeted Participants, who would receive tailored pre-employment services, and Intensive Participants, who would receive the same services but with greater financial assistance in 30 specified locations.
At 31 December 2018, six months into the national program, there were 75 259 participants in ParentsNext. Across the two streams of the program, approximately 95 per cent of participants are women, 68 per cent are single parents, and 19 per cent identify as Aboriginal or Torres Strait Islander.
As with the ParentsNext trial, participants in the national ParentsNext program are required to attend scheduled appointments with a ParentsNext provider, contracted by the Department of Jobs and Small Business, and agree on and complete activities in a participation plan in order to receive their Parenting Payment. Participants in the national expansion of ParentsNext are also subject to the Targeted Compliance Framework, described below, to record their participation.
Criteria for participation
Participation in ParentsNext is compulsory for parents who:
have been receiving Parenting Payment for six months or more; and
have not had any employment in the past six months; and
have a youngest child aged under six years old; and
meet other specific criteria based on their participation stream.
In the Intensive Stream, parents who meet the eligibility criteria are required to participate if they live in an Intensive Stream LGA and they are also:
an early school leaver and have a youngest child aged at least six months old; or
assessed as highly disadvantaged and have a youngest child aged at least six months old; or
have a youngest child at least five years old.
The Intensive Stream is intended to increase labour force participation of Aboriginal and Torres Strait Islander parents and support the Closing the Gap employment target; the Intensive Stream locations therefore include the 10 LGAs which were subject to the ParentsNext trial plus 20 new locations chosen for their higher proportion of Parenting Payment recipients who identify as Aboriginal or Torres Strait Islander. These LGAs include:
Bankstown, Wyong, Shellharbour, Dubbo, Sydney‑Central, Mid Coast, Orange, North Coast, and Tamworth in New South Wales;
Darwin-Palmerston and Alice Springs in the Northern Territory;
Playford, Port Adelaide, Port Augusta and Whyalla in South Australia;
Cairns, Logan, Rockhampton, Toowoomba, Mackay and Townsville in Queensland;
Kwinana, Perth-South, Perth-East, Geraldton and Broome in Western Australia;
Burnie and Brighton in Tasmania; and
Greater Shepparton, Hume and Mildura in Victoria.
Parents living in Intensive Stream locations who meet the eligibility criteria but not the additional specific criteria for the stream may choose to volunteer for ParentsNext. As voluntary participants are not legally required to meet participation requirements, they are not subject to the Targeted Compliance Framework.
The Targeted Stream is for eligible parents in all jobactive employment regions, i.e. all non-remote areas across Australia, who are not otherwise living in one of the LGAs in the Intensive Stream. The additional specific criteria in Targeted Stream locations are slightly different to those for the Intensive Stream, with parents being required to participate if they are:
an early school leaver and have a youngest child aged at least one year old; or
assessed as highly disadvantaged and have a youngest child aged at least three years old; or
from a jobless family and have a youngest child at least five years old.
Compulsory participants can be granted an exemption from ParentsNext in certain situations such as domestic and family violence, temporary incapacity, pregnancy, illness, or if they have particular caring or family responsibilities.
The Targeted Compliance Framework
Since 1 July 2018, all compulsory participants in ParentsNext are subject to the Targeted Compliance Framework (TCF), which also applies to employment programs such as jobactive and Disability Employment Services. According to the Department of Jobs and Small Business:
The TCF is designed to ensure that only people who persistently and wilfully fail to meet their mutual obligations incur financial penalties. It is also designed to offer additional protections to vulnerable people, recognising that most people do the right thing.
The TCF is primarily administered by participants self-reporting in an online system, however a ParentsNext provider can also report on behalf of a participant if they assess that the participant is unable to self-report.
Under the TCF, ParentsNext participants who fail to meet a requirement in their participation plan, such as attending a meeting with a provider or recording participation in an activity, have their Parenting Payment temporarily suspended until they re-engage with their ParentsNext provider. Any payments missed during a suspension are back-paid.
If a participant does not have a valid reason for failing to meet a requirement, they may be subject to demerit points under the TCF. Once a participant receives more than 5 demerit points, they may be subject to financial penalties up to and including total cancellation of their Parenting Payment. As at 31 December 2018, 967 ParentsNext participants had at least one demerit point and one participant had incurred a financial penalty of the loss of one weeks' Parenting Payment.
The use of the TCF in ParentsNext was subject to significant criticism from participants, advocates and ParentsNext providers during this inquiry.
The experience of participants
The committee has heard many distressing and disturbing accounts from participants and their advocates about their experiences with ParentsNext. While some parents were excited about the prospect of pre-employment support under ParentsNext, the majority described the frustrations, fears and negative impacts they had experienced after being referred to the program.
Concerns raised by participants and their advocates, which are outlined in this section, are broad ranging and include:
questions about participants' eligibility and referral to ParentsNext;
participants' rights under the program;
the content of participation plans; and
the punitive nature of the TCF, in particular the payment suspensions to which participants have been subjected.
Referrals to ParentsNext
The committee heard that many parents do not understand how or why they have been referred to ParentsNext. In a survey of ParentsNext participants conducted by the National Council of Single Mothers and their Children and the Council of Single Mothers and their Children Victoria (NCSMC/CSMC Survey), less than 20 per cent of respondents agreed that Centrelink had made clear to them why they had been selected to attend ParentsNext.
Parents explained their frustrations in not understanding whether they would be required to participate in ParentsNext after their referral interviews with Centrelink. In comments collected by the Centrelink and Other Info Facebook Group, one parent described that they had been told that they had to attend ParentsNext, only to find out that they were a voluntary participant, while another had been told during a phone interview that they were ineligible, only to be later referred to a provider. Another parent described her referral process to the committee:
I received a letter from Centrelink informing me that I would be required to participate in a phone interview to assess my eligibility for the ParentsNext program. I felt that I would be exempt after the interview only to be told that I have to participate and would from then on be required to report fortnightly to Centrelink, as well as meet with a ParentsNext provider to organise and complete required activities to continue receiving my payments.
Many participants and their advocates told the committee that parents are being referred to ParentsNext as compulsory participants even if they do not meet the criteria for participation or have circumstances which should make them exempt, and that the process around how exemptions are applied is confusing and distressing for participants.
Advocates described situations where parents had been incorrectly referred to ParentsNext despite having children younger than six months of age. Some shared examples of parents with newborn babies required by providers to attend activities and appointments in order to continue receiving their Parenting Payment.
Other participants and advocates explained how, even when parents understood that they may be eligible for an exemption, actually seeking that exemption from a ParentsNext provider was fraught with difficulty, as most exemptions are granted on a case-by-case basis at the provider's discretion. One advocate described how participants she had spoken with had not been granted exemptions on medical grounds, even for their own surgery, while another told the committee:
[A participant] didn't want to speak to the ParentsNext provider about what was going on medically for them and/or their family and got their GP to write a doctor's certificate, as per the ParentsNext requirements, with a start date and an end date for the time that the parent would need to be exempt. The parent went into the ParentsNext provider and produced this document from the GP, and the ParentsNext provider laughed and said, 'Oh, you don't seem that sick!'
Most alarmingly, there is evidence that parents who have informed Centrelink that they are experiencing domestic and family violence, which should be grounds for either delayed referral or exemption under the program, have been referred to service providers who require them to explain and prove their circumstances over and again. A parent described how she had been deemed ineligible for exemption because the violence against her had 'occurred in the past' and she therefore did not qualify for an exemption now:
I had to recount the whole emotional trauma of my experience as a [domestic violence] survivor and my ongoing battle with PTSD...I could tell they were totally unqualified to deal with this sort of thing, as they didn't know what to say to me over the phone, but said I'd likely qualify for an exemption but they would need ''to check with someone'' and get back to me...I received a call later that day from the same person who told me they were ''very sorry'' but I ''did meet the criteria for ParentsNext''. How can a [domestic violence] survivor...and someone still fearing for their and their children's life, not qualify for an exemption?
The committee also heard that ParentsNext providers are not considering the needs of survivors of domestic and family violence in their administration of the program. One parent illustrated her experience:
I have had to see a different staff member at each appointment, and have been asked to explain in extensive detail particulars surrounding family court, domestic violence etc. This is done without regard for the personal and sensitive subject nature involved, or the fact that it is inappropriate to [discuss] in front of or within hearing distance of my children. A lot of the questioning is completely irrelevant, and none of the staff seem to have any knowledge of the family court system or domestic violence issues.
Issues around the application of eligibility criteria and exemptions in the ParentsNext program are examined in detail in Chapter 3 of this report, while discussion about whether ParentsNext is an appropriate program for vulnerable parents, such as those experiencing domestic and family violence, is included in Chapter 2.
Privacy and personal information
The committee heard that there was confusion among participants about their rights in relation to the Privacy Notification and Consent form (privacy waiver) because of inadequate information or misinformation given by ParentsNext providers at their initial appointment.
According to the Department of Jobs and Small Business, this privacy waiver allows ParentsNext providers to facilitate the referral of participants to certain pre-employment services or activities, as this might require the disclosure of personal information. A participant can choose not to sign this form and not give the provider consent, but they will still be required to participate in the program and their provider will still be required to deliver services to them.
However, many parents have reported that they were told by their ParentsNext provider that signing the privacy waiver was mandatory, and that not signing would result in their Parenting Payment being suspended or demerit points being given. One participant explained:
I know the privacy statement is not mandatory but the manager told me I HAD to sign it or they couldn't sign me up to their ParentsNext program as not signing they couldn't help me get access to programs and I was going to be referred back to Centrelink if I refused to sign so I told them and showed them proof I didn't have to sign but they still wouldn't accept that information so I felt I had no option but to sign it in case I get a [demerit] point.
There are also significant concerns that the personal information collected by providers is being used for purposes other than referral to pre-employment services and activities, such as booking medical appointments on behalf of participants or contacting health professionals to ask questions about a participant's health. One advocate told the committee that:
I had a call this week from a woman who said that, when talking to her, her ParentsNext provider had asked for a copy of her Medicare card and a copy of her health care card, and suddenly on her activity appeared medical appointments for her children that she's not even received information about yet, and specialist and hospital appointments that the woman involved did not tell the agency about. So somehow they're managing to get information about medical appointments and specialist appointments.
These troubling accounts about the behaviour of ParentsNext providers in relation to privacy waivers and the use of participant's personal and sensitive information are examined in Chapter 3 of this report.
A key feature of the ParentsNext program is the participation plan, which is supposed to be developed and decided on collaboratively by participating parents and their provider. The Department of Jobs and Small Business submitted that:
The participation plan is a document in which a parent sets out their goals and commits to undertake provider appointments and agreed activities to achieve those goals. The focus of a plan is supporting the parent to achieve their employment goals. Before drafting a plan, the provider and the parent discuss the parent's goals, strengths and skills, as well as barriers and how they can achieve their goals. Where the parent does not have clear goals, the provider helps them work out what their goals are. The ParentsNext guidelines require plans to be tailored and take into account the parent's circumstances, particularly caring responsibilities, their goals and their capacity to comply.
Under the guidelines for ParentsNext, providers are required to give parents 10 days to consider their participation plan before agreeing to it. In practice, the committee heard that most parents did not know that they had this right, with the NCSMC/CSMC Survey finding that only three per cent of their respondents knew about the 10 day 'thinking time'.
Many participants and their advocates also told the committee that, in their experience, providers were not taking into account parents' circumstances, responsibilities or pre-employment goals when developing participation plans. One father submitted that:
The plan I was provided had none of my or my daughters needs included nor did it recognise the information I had provided. I was given a generic plan which included a goal of returning to full time work. I have not stated this as a goal, nor is it possible for me to achieve currently. Even more concerning is the activity that was assigned to my daughter, she was assigned to a reading program at a library in a neighbouring LGA. My [daughter's] diagnosis means this is poorly suited to her…My daughter could benefit from participating in other programs that have been recommended by her specialists which I explained to the interviewer which were ignored.
Some parents felt that the activities their providers had included in their plan, such as attending swimming lessons, library programs or playgroup with their children, were not preparing them for the workforce and that they were already undertaking these activities before starting ParentsNext. In some instances, parents were required by their provider to take their child out of kindergarten to attend these activities. One parent observed:
I believe parents who…already have their child in preschool/day-care, already do activities with their child and are already doing things to prepare themselves for employment should not be required to…participate in ParentsNext.
Another parent described:
My child is 3.5 years old and we were already going to do fun and educational activities before [ParentsNext], sometimes as much as twice a day. Now I feel like I'm being forced to do this activity with my child, it doesn't seem so enjoyable. I am having to spend more money on petrol to go and do the approved activity that is further away, rather than doing our own ones or ones that are closer in my community.
For some parents who were already undertaking study at TAFE or university, or had plans for going back to work, meeting with their ParentsNext provider is an added administrative burden to mandate what they are already doing:
I was already studying full time yet made to attend [ParentsNext] compulsory appointments for them to write on a piece of paper that my participation ... is full time study. Total waste of time as I get no help, I get no assistance towards my university course or transport costs and it means I lose a day of study to attend a pointless appointment.
One mother, who was on maternity leave from a position she was returning to, commented that:
I was treated like an uninformed and uneducated woman. [The provider] dismissed all of my questions and queries and forced me to sign the consent waiver and job plan straight away! I'm on maternity leave and have a job I'm returning to in February as a nurse!!
There have been reports that some providers were instructing parents to drop or change their current courses of study for other activities the provider wished for them to do, or did not otherwise recognise their study as an activity. The National Social Security Rights network submitted that:
A mother who was assisted by our member centre in Queensland told us that she was undertaking studies and interning but this was not recognised by ParentsNext providers…During this time, the mother told us she was so stressed by the ParentsNext program that she stopped interning. In order to fulfil her study obligations at TAFE she had to seek extensions for her assignments.
The committee also heard reports that providers were making changes to the activities on a parent's participation plan without their knowledge or consent.
The significant concerns about the content of participation plans, including what activities are appropriate to include in a pre-employment program for parents, are explored in Chapter 2 of this report. The behaviour of providers in relation to the development and enforcement of participation plans is addressed in Chapter 3.
Reporting using the TCF
One of the most distressing aspects of ParentsNext for many parents is the threat of their payment being suspended or cut off because of how participation reporting operates under the TCF. It is estimated that one in five participants in ParentsNext have been subject to a payment suspension since the introduction of the TCF.
Ms Terese Edwards from the National Council of Single Mothers and their Children told the committee that suspensions under the TCF are 'so blunt and so fierce that one error on anybody's part can result in a suspension'.
A survey conducted by the Centrelink and Other Info Facebook Group found that 70 per cent of responding participants in ParentsNext had had their payment suspended through no fault of their own, while the NCSMC/CSMC Survey found that 68 per cent of its respondents who had received a suspension had done so because of an error made by Centrelink or a ParentsNext provider.
The committee heard that for parents who are responsible for their own self-reporting through the online application, system outages and computer or internet problems can result in automatic payment suspensions which can have major financial consequences:
If they report late on the day that they need to report, because the app's been down or there have been issues getting online, then their payments are delayed by a day, which can then upset the whole financial balance and cause late fees and issues with direct debits.
Some parents have who are required to contact their ParentsNext provider to have their compliance recorded reported that, even after informing their provider that they had completed an activity on time, their payments had been suspended due to errors or failures by that provider. The committee heard about a participant whose provider had failed to record her activity, causing serious distress:
She texted the provider on the Friday, which was their agreement, that she had gone to the swimming lessons. On Saturday she received a text message saying her payment was suspended. She had no-one to talk to, of course, over the weekend. She was fearful that her automatic payment to her rent would default. She had a family engagement that she couldn't go to because she was scared that she needed to keep the money that she would normally spend on petrol to go. She spent the weekend in great fear. On Monday, she contacted the provider. Again, it was via a text message, and he just said, 'I didn't put in that you attended.'
Other parents have reported that they were required to send text messages, and in some instances photographic evidence, that they had attended each activity, leading to feelings of being under surveillance from their provider.
Many participants have reported the frustrations in trying to re-engage with their ParentsNext provider to have their payments reinstated. One parent described her experience in trying to resolve a miscommunication which resulted in a suspension:
What a stuff up. I was sure that I told [provider] that there was a change in the date. Bang, without knowing I was 'non-compliant'. The stress of trying to understand what I did wrong was hard as my [provider] worked part-time. No one really knew, or even believed that it was just a mess up regarding the dates. I spent three days stressed, heading into the weekend with my son's [sic] who is 18 months old…I was nervous about this program and now I hate it.
The committee was particularly concerned to hear evidence that a number of participants had needed to be directed to emergency relief services by their ParentsNext provider due to payment suspensions which occurred and could not be resolved over weekends and holiday periods.
Issues with the application and administration of the TCF, as well as its suitability for a pre-employment program such as ParentsNext, are explored in Chapter 3.
Conduct of the inquiry
On 4 December 2018, the Senate referred ParentsNext, including its trial and subsequent broader rollout, for inquiry and report by 31 March 2019.
The inquiry was advertised on the committee's website and the committee wrote to relevant organisations inviting submissions by 1 February 2019. The committee continued to receive submissions after this date. The committee also published a media release calling for submissions to the inquiry.
The committee received a total of 60 public submissions. A further 13 submissions were accepted as confidential. A list of submissions received by the committee is available at Appendix 1 and copies of public submissions can be accessed on the committee's website.
The committee held one public hearing in Melbourne on 27 February 2019. A list of witnesses who provided evidence at the public hearing is available at Appendix 2.
The committee thanks all of the individuals and organisations who submitted to the inquiry and appeared as witnesses.
Note on references
References to Committee Hansard in this report are to the proof transcripts. Page numbers may vary between the proof and official transcripts.