Coalition Senators' Dissenting Report

The majority report ignores one simple fact: jobactive – whilst far from
perfect – has performed well and at a lower cost compared to previous programs.
Around 50 per cent of job seekers are in work three months after participating in jobactive1 – compared to 42.5 per cent for the last three years of the Job Services Australia model.2
Importantly, these employment outcomes are proving to be sustainable with 81.5 per cent of jobactive participants still in employment three months after their job placement.3
Coalition Senators recognise that while the current system has achieved results, delivering around 1 000 job placements every day,4 there is room for improvement and more can be done, particularly to help those Australians facing significant barriers to employment. To this end, the Government is undertaking the most significant review and redesign of Australia’s employment services system since the privatisation of services in 1998.
While the committee has recognised the recommendations of the Expert Advisory Panel, commissioned by the Coalition Government, it is disappointing the committee has not recognised the extensive consultation process undertaken by the Panel to inform the design of a new employment services model. The Expert Advisory Panel, with support from the Department of Jobs and Small Business, conducted 23 face-to-face consultation sessions around the country which were attended by 560 unique stakeholders. In addition, they conducted in excess of 500 one-on-one interviews through an intensive user-centred design process, which incorporated a mixture of current job seekers, individuals who found employment through jobactive, employment services providers and employers. An additional 450 submissions were received on the panel’s discussion paper.5
It is clear that the Coalition Government is serious about eliminating problems in the current system and is designing a system which delivers for those whom it’s designed to benefit – job seekers and employers.
As the Department of Jobs and Small Business noted in their most recent evidence before the committee, since the delivery of the Expert Panel’s report, the Government has undertaken further targeted consultation with stakeholders, including job seekers.6
Coalition Senators note that the committee has largely delivered a report which does not present any value-add beyond the extensive work program currently underway which actually ensures a future fit employment services system which delivers results for those who need it most.

Labour Market

The Coalition Senators note that the committee has chosen to perpetuate false claims made by the ACTU and others regarding the level of ‘insecure’ work in the economy. Australian Bureau of Statistics data7 shows that:
the percentage of employees who are casuals has been relatively stable over the last two decades, and was 25.3 per cent in November 2018 compared to a peak of 25.5 per cent in 2004;
the proportion of Australian workers who are independent contractors has remained broadly stable over the last decade (and has reduced from 8.7 per cent in 2016 to eight per cent in 2018);
the proportion of employees on fixed-term contracts has been stable at around four per cent since 2004;
the use of labour hire as a proportion of all employees has been stable at less than two per cent over the last decade.
These trends have also recently been confirmed by Mr Guy Debelle, Deputy Governor of the Reserve Bank of Australia, noting:
The share of people working as independent contractors has declined a little over the past decade, the share of people working casual jobs is also little changed. The labour account data reports information on workers with more than one job. It suggests that secondary jobs – i.e. filled by people who also have a primary job – account for around 6 per cent of total jobs, which hasn't changed much over the past five years.8

Compliance

The Targeted Compliance Framework has resulted in a drastic reduction in the number of job seekers receiving financial penalties, while providing job seekers with clearer, more consistent expectations and giving them greater personal responsibility for their personal compliance.9 The new framework provides additional opportunities for job seekers, providers and the Department of Human Services to discuss the job seekers’ personal circumstances and ensure that their job plan is not putting unreasonable burdens on the job seeker.10
Coalition Senators note evidence provided to the committee that the new compliance system has seen a 95 per cent reduction in financial penalties applied to job seekers.11
Given demerits expire over time, to be at risk of incurring a financial penalty a participant generally needs to have five failures without a valid reason within six months. Coalition Senators note that job seekers will be assessed by both their provider and Centrelink before reaching this point to ensure that they are not being persistently penalised for mutual obligation expectations which are not appropriate for their circumstances.12
Coalition Senators further note that the committee’s report incorrectly states that 665 participants had received a payment cancellation or reduction as a result of being in the ‘penalty zone’ as at 30 September 2018. A closer reading of the tabled evidence shows that, in fact, 541 of those individuals had not received any financial penalty under the TCF, being instead in the ‘red zone’ without having incurred any demerits in that zone; and that 124 job seekers had actually received a financial penalty under the new compliance framework.13
Coalition Senators note that the committee’s report erroneously conflates the Targeted Compliance Framework with the former compliance system. The Targeted Compliance Framework was introduced to address the high rate of error in provider reports to the Department of Human Services by creating consistent expectations for job seekers and not applying permanent financial penalties for first time non-compliance.14
Evidence from the Department of Jobs and Small Business also noted that the Targeted Compliance Framework has removed administrative burden from providers eliminating the highly intensive and transactional arrangements relating to previous compliance arrangements such as submitting a variety of different non-compliance reports to the Department of Human Services.15 Further evidence suggests that there is no undue administrative burden associated with the lifting of demerits:
To remove the demerit the provider accesses the job seeker’s compliance history page in ESS Web, selects the relevant non-compliance event, then selects “manually remove demerit” check box. The provider records the reason for removing the demerit, clicks save and the demerit is removed.16

Work for the Dole

Coalition Senators note the committee has perpetuated incorrect misrepresentations of the findings of an independent safety audit undertaken by Ernst & Young at 200 Work for the Dole sites. The compliance findings are not a safety benchmark. The average compliance score applying Ernst & Young’s assessment tool was 91 per cent with 64 per cent of activities meeting or exceeding this average score. By extension, this means that 36 per cent of activities were under the average score.17
Further, Coalition Senators note evidence from the Department of Jobs and Small Business that work health and safety is a fundamental requirement of the Work for the Dole program. It continues to be a priority focus area for the department in managing the program.18 Jobactive providers are contractually obliged to meet all relevant Commonwealth, state and territory work health and safety legislative requirements and ensure that all the activities are carried out in a safe manner. The rate of reported injury under the program is low at around one per cent – compared to around four per cent in paid work.19
The Department of Jobs and Small Business has noted previously that they are providing a level of assurance about work health and safety that is in excess of the level of assurance at ordinary worksites.20 Ernst & Young noted in their independent audit report that “the Department has rigorous work health and safety obligations under the jobactive Deeds…”21
As per the evidence provided to the committee, Work for the Dole is an activation program, not a job-matching program. It provides valuable worklike experiences to help participants gain the skills, experience and confidence to move from welfare to work, while giving back to the community.22
Senator Slade BrockmanSenator James Paterson
Deputy ChairMember

  • 1
    Department of Jobs and Small Business, Submission 55, p. 3.
  • 2
    Coalition slams Labor's welfare changes, SkyNews, 8 January 2019, https://www.skynews.com.au/details/_5986993500001
    (accessed 14 February 2019).
  • 3
    Mr Nathan Smyth, Deputy Secretary Employment, Department of Jobs and Small Business, Committee Hansard, 1 February 2019, p. 37.
  • 4
    Mr Nathan Smyth, Deputy Secretary Employment, Department of Jobs and Small Business, Committee Hansard, 1 February 2019, p. 37.
  • 5
    Employment Services Expert Advisory Panel, I want to work: Employment Services 2020 Report, December 2018, https://docs.jobs.gov.au/documents/i-want-work (accessed 14 February 2019), p. 75.
  • 6
    Mr Nathan Smyth, Deputy Secretary Employment, Department of Jobs and Small Business, Committee Hansard, 1 February 2019, p. 39.
  • 7
    Australian Bureau of Statistics, Characteristics of Employment, Australia, August 2018, cat. no. 6333.0, 29 November 2018.
  • 8
    Mr Guy Debelle, The State of the Labour market, 17 October 2018, https://www.rba.gov.au/speeches/2018/sp-dg-2018-10-17.html
    (accessed 14 February 2019).
  • 9
    Mr Nathan Smyth, Deputy Secretary Employment, Department of Jobs and Small Business, Committee Hansard, 14 November 2018, p. 30.
  • 10
    Department of Jobs and Small Business, Explainer: Targeted job seeker compliance framework, 26 June 2018, https://www.jobs.gov.au/newsroom/explainer-targeted-job-seeker-compliance-framework (accessed 14 February 2019).
  • 11
    Mr Nathan Smyth, Deputy Secretary Employment, Department of Jobs and Small Business, Committee Hansard, 1 February 2019, p. 39.
  • 12
    Department of Jobs and Small Business, Explainer: Targeted job seeker compliance framework, 26 June 2018.
  • 13
    Department of Jobs and Small Business, Jobactive figures, 30 September 2018, 2018-19 Supplementary Budget Estimates (tabled 24 October 2018).
  • 14
    Department of Jobs and Small Business, Explainer: Targeted job seeker compliance framework, 26 June 2018.
  • 15
    Mr Nathan Smyth, Deputy Secretary Employment, Department of Jobs and Small Business, Committee Hansard, 1 February 2019, pp. 37-38.
  • 16
    Department of Jobs and Small Business, answers to questions on notice, 1 February 2019 (received 8 February 2019), p. 3.
  • 17
    Senate Education and Employment Legislation Committee, Committee Hansard, 29 May 2017, p. 116.
  • 18
    Senate Education and Employment Legislation Committee, Committee Hansard, 29 May 2018, p. 73.
  • 19
    Senate Education and Employment Legislation Committee, Committee Hansard, 29 May 2018, p. 74.
  • 20
    Senate Education and Employment Legislation Committee, Committee Hansard, 29 May 2017, p. 116.
  • 21
    Ernst & Young, Work Health and Safety Aggregated Onsite Audit Report, June 2016, https://docs.jobs.gov.au/documents/work-health-and-safety-aggregated-site-audit-report-june-2016 (accessed 14 February 2019), p. 2.
  • 22
    Senate Education and Employment Legislation Committee, Committee Hansard, 19 October 2016, p. 26.

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