Foreword

Jobactive is the government’s generalist employment service and the largest program through which employment services are delivered to Australians. People of working age not serviced by specific programs, such as Disability Employment Services, are generally required to participate in jobactive to receive income support.
The stated objectives of the jobactive program, in addition to jobactive organisations delivering quality services, are to help job seekers find and keep a job, help job seekers move from welfare to work, and help job seekers meet their mutual obligations.
The committee was tasked with examining the appropriateness and effectiveness of jobactive. The committee also considered the recent report of the Employment Services Expert Advisory Panel into the future of employment services. The committee's deliberations were informed by submissions received from many jobactive participants, jobactive providers, employment services consultants and other stakeholders. The committee heard directly from jobactive providers, charities, community organisations, and most importantly, unemployed people, at five public hearings held across Australia.1
Through the evidence the committee received, it became clear that the jobactive program is not fit for purpose. It is not delivering on its stated objectives. Participants are gaining employment in spite of jobactive, not because of it. And many participants are suffering because of the program's punitive compliance arrangements. Providers are overburdened with red-tape and consultants are struggling to help participants whilst also policing compliance requirements.
Four key themes emerged during the inquiry. The first is that the services and support arrangements that should be a part of an effective employment services system simply aren’t there. People are assessed as 'job ready', when they have multiple serious barriers to employment, such as homelessness and substance abuse. This mis-categorisation limits the services and support available to disadvantaged participants. Even when people are assessed properly, there is often insufficient support. People are not receiving the basic job-readiness services that jobactive is meant to provide, such as assistance with resumes and interview practice. Employment services consultants have average caseloads of around 150 participants which means they simply don't have the time to provide tailored support and services.
The second theme that emerged during the inquiry is that the government's job search and other mutual obligation requirements are poorly designed and often inappropriate. Participants are missing paid employment to attend appointments with their jobactive provider. The requirement to apply for 20 jobs every month burdens employers who are receiving masses of poor quality applications often from people who are not suited for the position. Participants are approaching the same employers over and over because there are insufficient jobs. People who have to do Work for the Dole are not guaranteed a safe work environment—and there's no workers' compensation if they are injured.
The third theme that emerged is that jobactive's compliance framework is punitive and in some cases grossly unfair. In 2018, the government imposed harsh new penalties under the Targeted Compliance Framework (TCF). Under the TCF, jobactive providers, rather than public servants, are responsible for monitoring compliance and suspending a person's income support if they do not meet their mutual obligations. As at 31 December 2018, six months into the TCF, 42.5 per cent of jobactive participants have at least one demerit point resulting in support payment suspension. In addition, over 4000 participants have more than five demerit points and are already in the 'penalty zone'—resulting in reduction or cancellation of their payment. Worryingly, more than half of all homeless jobactive participants have at least one demerit point. In addition, almost 20 per cent of participants who are in the penalty zone are homeless. Indigenous Australians are also highly overrepresented in the compliance data. Only about 13 per cent of jobactive participants are Indigenous, however almost 28 per cent of those in the penalty zone are Indigenous.
People who have done nothing wrong are having their income support suspended because of administrative errors. The committee heard that the 2015-16 error rate for penalties was around 50 per cent. Yet because of recent action by the government, now when this happens, participants have their support payments suspended without proper recourse. This is because in 2018 the government restricted the power of Centrelink to overturn penalties. All of this means that people who may have done nothing wrong are having their income support suspended, suddenly and without any warning.
When defending jobactive's performance, the government often states that the program has achieved more than 1.2 million job placements. However, it is important to consider the kind of work that participants are doing—is it a job that will give people the opportunity to move off income support and into lasting employment, or is it a short-term placement that keeps a person in the revolving welfare system?
In this regard, the last main theme that emerged during the inquiry is that the current funding model incentivises jobactive providers to churn people through short term work, rather than helping them to secure sustainable longer-term employment. Jobactive providers receive payments when a person has remained in employment for four, 12 and 26 weeks. There are no further payments after 26 weeks. However, when people cycle in and out of short term work, their jobactive provider can continue to receive outcome payments. Providers are rewarded financially for churning people through jobs that don't last.
Disturbingly, the funding model also disadvantages the most vulnerable job seekers. The average length of time spent in jobactive for the most disadvantaged job seekers is five years. Funding based on employment outcomes means that these highly vulnerable people can be 'parked', receiving no support from their provider, because they are less likely to get a job.
Jobactive is not welfare to work, it is welfare to nowhere.
The government's punitive and paternalistic approach to employment services has failed. It goes against international and Australian evidence about what works. In designing the future system to replace jobactive in 2020, the government must get back to basics: the future system must help all job seekers find and keep a job.

  • 1
    References to unemployed people throughout the report should be taken to include underemployed people unless otherwise indicated.

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