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Welfare 'investment approach' improves lives in the long term, 'a moral outcome': Christian Porter -

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MICHAEL BRISSENDEN: The Turnbull Government says it will go ahead with plans to radically overhaul the welfare system.

The changes are being labelled as an investment approach to welfare that will aim to use data to target long term welfare dependency with a particular focus on younger people.

It's largely based on a successful welfare overhaul undertaken by the New Zealand government.

The Turnbull Government says the investment approach is about preventing long-term welfare dependency - not about cutting welfare - but the idea does have some critics.

I'm joined now by the Social Services Minister Christian Porter.

Christian Porter, good morning.

CHRISTIAN PORTER: Yeah, good morning, Michael.

MICHAEL BRISSENDEN: What is different in this approach to welfare? I mean you've called it an investment approach, but what does it mean?

CHRISTIAN PORTER: What's largely different about is that it's based on data and evidence.

So several years ago, we spent $34 million to commission PWC (PricewaterhouseCoopers) to do a large piece of longitudinal research for us.

Essentially what they did for us was go back into the welfare system over the last 15 years and collate every single piece of data that we'd collected inside the welfare system, and turn that into effectively a large systems platform - so a computer program, if you like.

And that allows us to predict what will happen to groups going forward - and not just large groups, not for instance everyone on Newstart. It allows you to drill down to very, very small groups of people who share similar characteristics.

And that kind of ability means that we will be able to identify small groups of people who are at risk of either entering into the system in circumstances where they could have a high risk of becoming dependent, or people in the system who are already dependent on welfare.

MICHAEL BRISSENDEN: So technology clearly, and the amount of data we have has obviously made this easier, but how vulnerable is that? I mean, are there privacy issues around this open source data?

CHRISTIAN PORTER: Well the open source data is redacted to the point that it doesn't identify individuals.

So for instance, the example that I've used is that we could be able to go down and look at a group of two or three-thousand people that represent young people in Geelong between 18 and 22. And then we can use that compare the data against similar groups that might exist - young people in Newcastle or Kununurra or wherever it might be.

So there are no privacy issues, but for the first time what it allows us to do is take a very scientific evidence-based approach to welfare.

So as well as spending that $34 million, Michael, we've also put in this very last budget $96 million into what we call a try, test learn fund.

Now the idea of this fund is that we will in effect take bids from the non-government sector, not-for-profits, any organisation who thinks they have a plan that can (inaudible) one of these groups inside the system and improve their lives decreasing their dependency on welfare and we will fund that organisation to undertake that plan, and obviously use the data to measure going forward whether or not the group they're targeting is having better success rates in terms of getting off welfare than an average group in the sample.

MICHAEL BRISSENDEN: So the idea, by its very nature, is designed clearly to prevent young people staying on welfare for long periods of time. So it's clearly biased towards young people.

But does that mean potentially that there'll be too much focus on younger people and not enough on some of the older people who might also need help?

CHRISTIAN PORTER: Well, I mean that's the criticism that ACOSS have rather unfairly leaded, I must say.

Look, if a government gets criticised because it's doing something new and investing new money and the effect of that investment is to break welfare dependency for young people and improve their lives by making them productive, happier citizens, if that's a criticism, that's a criticism most governments will take any day of the week.

But what it is, it is very new in the sense that it's something we've never been able to do before, that is government. And it's this government, a Coalition Government, that's put together the data platform that's going to allow us to drill down into the system and refocus welfare policy from the notion of an economical budgetary outcome to the notion of a moral outcome for human beings who have found that their lives have been destroyed through welfare dependency, and trying to revive these groups inside the system, make them less dependent on welfare and move them out into happier and more productive lives.

MICHAEL BRISSENDEN: This is based as I understand it, very much on the approach already taken in New Zealand. Now obviously that's a much smaller catchment, much smaller welfare system. Are you confident, is there any proof that it can work in Australia?

CHRISTIAN PORTER: Well, it will all be evidence based. So for instance, if I go back to that $96 million that we're going to invest in this try, test learn fund, when people come to us with bids, they might be social impact on type arrangements, or they might be direct investments or services or programs that are going to be offered to one of these groups that we've identified in the system, the money will flow as results flow. So everything will be evidence based.

I mean, what we've been doing largely to this point, Michael, acting on something that's a bit like intuition. We do things that we think will work because we understand the mechanics of why they should work.

But the measurement that actually demonstrates over the long term that they have been working just hasn't been available because of technology and cost.

And now we've broken that problem and that means that what we'll be able to do is to actually improve people's lives by targeting and focusing policies and approaches and new ways of doing things inside the system to bring people out of welfare and break cycles of dependency.

MICHAEL BRISSENDEN: Just quickly then, can you do it without legislation? Have you got the support do you think for these changes?

CHRISTIAN PORTER: Well, it depends on what type of policy program you target against the group that you've identified.

Some of them may involve considerably more legislative changes, but largely speaking what we're trying to do is offer services and assistance to people who've been identified at risk of long term welfare dependency, to crack the back of that dependency and move them into better and more productive lives. So largely speaking, this is about investing in terms of services and expenditure in the short term to improve people's lives in the long term, and that's largely something that can be done without heavy reliance on legislation.

MICHAEL BRISSENDEN: Christian Porter, thanks very much for joining us.

CHRISTIAN PORTER: Thank you, Michael. Cheers.

MICHAEL BRISSENDEN: Social Services Minister Christian Porter.