Key Takeaways:
- Almost half of all people using employment services received threats to suspend their payments in the last quarter, with 618,000 payment suspension notices issued.
- The number of payment suspension notices increased by 23% from the previous quarter, with 347,000 resulting in at least a temporary pause of payment.
- First Nations people were most affected, with 52% of those with a provider having at least one suspension in the quarter.
- The system is failing to meet its employment targets, with just 11.7% of jobseekers finding long-term employment through a job provider in the latest financial year.
- Advocates are calling for a pause in suspensions until the government can ensure the target compliance framework is working legally.
Introduction to the Issue
The latest data from the Department of Employment and Workplace Relations (DEWR) has revealed a shocking increase in the number of payment suspension notices issued to people using employment services. In the last quarter, 618,000 payment suspension notices were issued, which is a 23% increase from the previous quarter. This means that almost half of all people using employment services received a threat to suspend their payments. The data also shows that 347,000 of these notices resulted in at least a temporary pause of payment, which is a significant concern for those who rely on these payments to survive.
The Impact on Vulnerable Groups
The suspensions have had a disproportionate impact on First Nations people, with 52% of those with a provider having at least one suspension in the quarter. This is a concerning trend, as First Nations people already face significant barriers to employment and are more likely to experience poverty and disadvantage. The suspensions have also had a significant impact on the overall well-being of people in poverty, with advocates arguing that the system is prioritizing the financial viability of job agencies over the well-being of people in need.
The Target Compliance Framework
The suspensions are part of the mutual obligations regime, which is meant to ensure that recipients are actively looking and preparing for work. However, the system has been criticized for being overly punitive and failing to provide adequate support to jobseekers. The target compliance framework (TCF), which is the automated system that runs mutual obligations, has been investigated by the commonwealth ombudsman and found to have significant flaws. The ombudsman’s report found that the department was not maintaining "effective oversight" of employment providers, with the majority of decisions being overturned.
The Failure of the System
The data also shows that the system is failing to meet its employment targets, with just 11.7% of jobseekers finding long-term employment through a job provider in the latest financial year. This is despite the fact that taxpayers are paying $750m per year for the service. The largest for-profit providers are receiving significant payments from the government, with the top providers receiving $300m in the last financial year. However, the system is not providing value for money, with many jobseekers not receiving the support they need to find employment.
Calls for Reform
Advocates are calling for a pause in suspensions until the government can ensure that the target compliance framework is working legally. They argue that the system is causing harm to people in poverty and that the government should prioritize their well-being over the financial viability of job agencies. The Australian Council of Social Services (Acoss) is also calling for an independent quality commission to ensure accountability of providers and protect people from the harm being inflicted. The CEO of Acoss, Dr. Cassandra Goldie, said that "any decision that affects a person’s access to income support should not be made by private companies."
The Government’s Response
The government has responded to the criticism by saying that it has taken measures to safeguard the use of suspensions, including increasing the resolution time from two to five days and introducing a warning rather than a payment suspension if it’s the first time a person has missed a mutual obligation requirement. However, advocates argue that these measures do not go far enough and that the system needs to be overhauled to prioritize the well-being of people in poverty. The department has also said that it regularly monitors key aspects of the system, including how providers make decisions under the targeted compliance framework, and that it overturns decisions that are incorrectly or inappropriately applied. However, the data shows that the system is still failing to meet its employment targets and that significant reforms are needed to address the issues.
