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Thursday, 4 April 2019
Page: 14923

Centrelink

Dear Mr Vasta

Thank you for your letter of 22 May 2017 regarding petition number EN0160, in relation to the provision of income support payments, job seeker mutual obligation requirements, work programs and the provision of public housing. I regret the delay in responding.

The provision of an income support safety net for working-age Australians is a longstanding policy that has been supported by successive governments and meets community expectations. Without this safety net many Australians and their families would experience serious hardship when they become unemployed or experience other changes in circumstances.

Social security payments operate in conjunction with taxation concessions, productivity initiatives, employment services and labour market strategies, as part of an integrated package to support workforce participation objectives.

Newstart Allowance is the primary income support payment for unemployed people of workforce age while they look for work. Recipients are required to demonstrate that they are actively looking for work, or undertaking activities to improve their work prospects. These long standing arrangements are called mutual obligation requirements and generally meet community expectations for receipt of taxpayer funded income support. Job seekers must meet their mutual obligation requirements to continue to receive payment, unless they have been granted an exemption by the Department of Human Services.

Newstart Allowance is not time-limited. This is because many recipients require additional assistance to increase their employability and may take longer to become 'job ready' because of barriers they face, such as low levels of education, no significant employment experience, or a lower capacity to participate due to an illness or disability, or significant caring responsibilities.

Newstart Allowance recipients are expected to do all they can to become job ready, find work and reduce their reliance on income support. For this reason mutual obligation requirements may include activities such as job search, part-time work, training, Work for the Dole or other approved activities that improves their job readiness and employability.

Mutual obligation requirements are agreed between the job seeker and their employment services provider, and are included in a Job Plan which outlines the expectations and obligations of the recipient in return for income support payments. This includes the type of activities to be undertaken by the job seeker and may include advice or training, such as appropriate behaviour and presentation when undertaking job search activities. Job seekers who fail to meet their mutual obligation requirements or comply with their Job Plan may be subject to compliance action.

In the 2017-18 Budget, the Government announced a new targeted compliance framework that strengthens penalties for people who persistently and deliberately do not comply with their requirements while receiving unemployment payments. While the majority of job seekers genuinely try to meet their requirements while on payment, a small but persistent minority consistently do not meet their requirements despite being able.

From 1 July 2018, subject to the passage of legislation, the new targeted compliance framework will strengthen penalties for those job seekers while reducing penalties for job seekers who are generally compliant but occasionally miss a requirement.

All job seekers will commence in the Personal Responsibility Phase (demerits phase), where failures will result in a payment suspension and demerit, but no actual penalty. If a job seeker accrues four demerits in six months they will enter the Intensive Compliance Phase (three strikes phase), in which they will face stronger penalties. They will:

lose 50 per cent of their fortnightly payment for their first strike;

lose 100 per cent of their fortnightly payment for their second strike; and

have their payment cancelled for four weeks for their third strike.

Job seekers who remain fully compliant for three months in the three strikes phase will return to the demerits phase, with their demerits reset to zero. In either phase, any jobseeker who refuses work without a valid reason will have their payment cancelled for four weeks.

Importantly, some jobseekers may be unable to meet their requirements due to personal circumstances that have not been fully taken into account or may have a greater than expected impact. To protect these job seekers from inappropriate penalties, providers will interview them about their non-compliance when three demerits have been accrued. The Department of Human Services will follow-up with an assessment of the job seekers' capability when four demerits have been accrued. In both instances, requirements will be adjusted to match capabilities where necessary, and demerits may be reset to zero.

In relation to the suggestion for a new work program, there is a range of existing work programs and employment incentives, including Work for the Dole, which is designed to help job seekers build their skills, demonstrate work behaviours and get involved in their local community. Other programs include the National Work Experience Program and the Youth Jobs PaTH initiative, which is designed to give young job seekers the skills and work experience they need to get and keep a job.

In regard to the provision of public housing, while the Commonwealth Government provides the states and territories with about $1.3 billion each year under the National Affordable Housing Agreement for housing assistance, the day-to-day management of public housing rests with individual state and territory governments.

If the petitioner would like further information about housing in their state, I would encourage them to contact their local state or territory government housing authority.

Thank you for raising this matter with me.

Yours sincerely

from the Minister for Social Services, Mr Porter(Petition No. EN0160)