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STANDING COMMITTEE ON EMPLOYMENT AND WORKPLACE RELATIONS
04/06/2010
Regional skills relocation

CHAIR (Ms Jackson) —I declare open this public hearing for the committee’s inquiry into regional skills relocation. I welcome the representative of Jobs Australia, David Thompson, to today’s hearing. Although the committee does not require you to give evidence under oath, I should advise you that this hearing is a legal proceeding of the parliament and therefore has the same standing as proceedings of the respective houses. As you may already have picked up, these proceedings are being broadcast on the internet. We have received your letter and submission, and I thank you very much for that contribution. I wonder if you would like to make an opening statement before I turn to committee members for questions.

Mr Thompson —Our submission is very much grounded in the practicalities of actually getting this done rather than a more removed and sophisticated sort of public policy analysis, if I can put it like that. What we have done is draw on the experience of one of our members who, as the committee will observe, has had quite a lot of experience moving generally unskilled job seekers from various locations to take up work—in some cases, from country New South Wales to Sydney and so on, and in other cases across the country from one end to the other, picking up the limited amount of work that is available for unskilled job seekers in the mining industry in particular.

We are of the view that it can be done but that it requires investment, by the government and/or employers, of additional resources other than those available under the current Job Services Australia arrangements to provide for the extra support, coordination and other assistance that people need to change locations. As we indicate in the submission, there are a number of important supports that need to be provided to people to enable them to make what for them will in some cases be quite significant moves. I think I will leave it at that.

CHAIR —Thank you for that. I will just query a couple of things. We have heard evidence from other organisations and about other relocation programs, and one factor that is not mentioned in your submission but seemed to rate reasonably highly in their view was the need for mentoring, particularly of young people who have been relocated, to ensure the successful transition.

Mr Thompson —We do not use the word ‘mentor’, but we do use the word ‘support’ quite a lot. It effectively means the same thing. I think it will be particularly the case for young people who might otherwise be somewhat vulnerable. I have just come from running an incredibly successful conference on Indigenous employment, education and training in Alice Springs for the last three days, and it is absolutely the case, if we are talking about doing this with Indigenous people, that very effective support and mentoring is an absolute must. So I agree with other submissions on that point.

CHAIR —The point I am also making is that it is not just about support. There is often support available that people do not know about. It is about consistent mentoring of a person, rather than a multiple number of agencies. Would you agree?

Mr Thompson —Absolutely. We own and deliver an accredited mentoring program for Indigenous people in the employment context. They cannot be expected to navigate very complex layers of various service delivery systems. They need to be helped to navigate them by somebody they know and trust.

Mr HAASE —I have numerous questions. It is always difficult doing this remotely. In your experience, I imagine, you would have in the first instance come up against the culture of unemployment and the question of the preparedness of the individual to relocate as opposed to an expectation that the job will come to their location. I would be interested to hear from you your experience in gauging that culture or perception—the question of mutual obligation, the question of who is responsible for a person being employed in the long run.

Mr Thompson —The way I would approach that is to say that I do not think compelling people against their wishes to undertake a significant change in location is going to be very successful. I absolutely accept that in return for receipt of income support and other assistance from the state the unemployed citizen has some obligation in terms of looking for work and accepting reasonable offers of work. I do not have any issue with that proposition. Where people can be made aware of the benefits of relocating, and where they are provided with the support and assistance they need to move out of their existing family and other social networks, we could be reasonably successful in helping quite a few people relocate when in the first instance they may not have seen that as a possibility. As I say, with the right combinations of encouragement and support we can get them to make the move. In the case of a lot of young people, and particularly Indigenous young people as well as older Indigenous people, the importance to them of their family networks and all of the things that go with that cannot be underestimated. Again, they can be assisted to move but they need the right sorts of assistance and support to be able to do that. During the conference in Alice Springs, which I mentioned earlier, I saw what looked to be a very effective e-learning program for Indigenous people which has a lot of material about how they might relocate and so on. In response to the opposition leader’s proposition some weeks ago that people under 30 should be compelled to move to areas where there is work, I said two things. First, there is not a lot of unskilled work in the mining industry or the resources sector. Second, it is simply not realistic to expect people to move themselves on the basis that if they do not do so they will loose income support. It just would not work.

Mr HAASE —That of course is from an existing culture in Australia where the whole of the system has in recent decades been one where you are supported during your period of unemployment almost regardless. There has been little accent on mutual obligation with respect to job finding. Any policy put in place that encourages people to become employed is seen as stick policy rather than reasonable expectation policy. With your involvement over time do you ever see a future where the recognition of mutual obligation from the point of view of the unemployed will improve?

Mr Thompson —I have been involved in this activity as a former official of the Commonwealth and in my current capacity for over 30 years. I think there have been times over the last 30 years and most notably in the last five years of the former government where there was a significant overemphasis in the obligations on job seekers. There was a preoccupation with seeking to secure and monitor their compliance with their obligations and insufficient emphasis on the need to provide assistance to these people.

In these things there are always difficult questions of balance and I think it is important to note a couple of other things. No one is living the life of Riley on $231 a week that they get as a single rate Newstart allowance. I think there is a lot of evidence to suggest that a lot of people not only are actually doing it tough but are really quite humiliated by the system. We supported some research that has been conducted with the benefit of Australian Research Council funding by a consortium of universities led by Melbourne university with a number of others, UWA, University of Queensland, Monash and others, where the researchers undertook a longitudinal study of 150 Australians on low incomes. The output of that research, which is now completed, will be published later this year as a book which has the working title Half a Citizen. It is very clear from that research that the great majority of the citizens who happen to be unemployed really, really want a job. I think it is only a very small proportion that might have some degree of comfort and are in that context avoiding work and not doing what we should reasonably expect of them in return for their receipt of income support.

Mr HAASE —With your permission, Chair, I will ask one more question and then bail. In your submission you make mention of some of the significant hurdles to relocation and you mention of course affordable, accessible accommodation.

Mr Thompson —Yes.

Mr HAASE —It has always been a problem and it is a major problem in those areas of high job growth. I refer specifically to the Pilbara in Western Australia, Karratha and Port Hedland. I have in mind the old Commonwealth hostel arrangements that in previous times provided that temporary accommodation whilst people settled in an area. Is that the sort of thing that you envisage as a solution or a part solution to this mobility of the unemployed?

Mr Thompson —I think in fact it may well be. I was brought up in Devonport in Tasmania and in the mid-seventies I went to work in Karratha, when Karratha was being built, as an unskilled house painter. For the first three weeks that I was doing that I lived in a tent. I have to tell you that was extraordinary difficult and uncomfortable. Clearly, people need access to affordable housing. You would know more about this than I do, but I gather that the price of private rentals in some places in the Pilbara is extraordinarily high, so some form of supported accommodation such as the old Commonwealth hostels would probably be quite a good solution.

Mr HAASE —Thank you, David.

Mr RAMSEY —You talk about a major mining company teaming up with their HR expert and presenting in different regions, I presume areas with high unemployment, a whole package of what the company can offer in an effort to recruit. Can you flesh that out a bit more for us, tell us how it has gone and how successful it ultimately was?

Mr Thompson —As we say in our submission, the people that did this report found that it was extraordinarily effective because the employment services providers were hooked into exactly what it was the HR people in those organisations wanted. I think one of the keys to success in this regard is for there to be really, really close and effective collaboration between the HR departments of various resources enterprises, Job Services Australia and other providers. They had a conversation earlier in the week in Alice Springs with a major private sector recruiting organisation that is heavily involved in the resources sector. They say one of the keys to their success is effective liaison with the Job Services Australia providers, so I think it is pretty important.

Mr RAMSEY —If it is so successful, why is it not the industry norm and why are we not able to recruit more people through that process?

Mr Thompson —I suspect there are a couple of things happening. One is some of the arrangements in the current settings of Job Services Australia do not provide enough resources for distant providers to do some of this. There needs to be some extra money in the system somewhere. I think we also need to do more to promote the good stories so that other people learn about them and pursue them.

Mr RAMSEY —On another issue, earlier we received evidence—I think from DEEWR—about a relocation trial they had going a few years ago where there was $5,000 to help with relocation expenses. From memory they said the program proved quite expensive to run and to administer. While they probably declared it a qualified success, I thought maybe it was not as good as we would have hoped. Do you have any understanding of how that worked and any views on it?

Mr Thompson —Yes, it was done most recently on the watch of former Minister Sharman Stone. It was quite limited in scope and number and I suspect—I would actually need to talk to some of the people with direct involvement—there was probably a reasonably hefty amount of red tape involved in some of those arrangements. A unit cost of $5,000, in terms of the net economic benefit of conducting a successful relocation, is probably in the order of petty cash. People go off Newstart and if they are successful they will stay off it, they pay income tax and are really quite productive.

Mr RAMSEY —Do you think it would be more successful if it offered more money?

Mr Thompson —I suspect a sum of money of the order of $5,000 is probably in the ballpark. What probably needs to happen is to find some ways of cutting through some of the red tape that operates in the current employment services system to make it a lot easier for a number of things—to actually spend the money on the relocation and doing all of that and to promote collaboration between providers operating in the examples used in our submission, from Kempsey to the Pilbara—so that there is something in it for both of them to collaborate and so on. That would be a matter of sitting down and working out what sort of arrangements the system needs to have to make this work effectively. That would easily be done by getting some of the officials that administer the Job Services Australia arrangements and some of the many very experienced employment service providers and actually working out how you design something that is set up in a way to provide all of the resources and to make sure there is nothing getting in the way of doing it in the way that it needs to be done.

Mr RAMSEY —I sometimes wonder how important the economic barrier is to shifting and think that it is more about mindset—people just have not got their head around the idea that they might leave their natural home or where they have been living a long time and relocate to another part of Australia. I was quite interested in the program I was speaking about before which links with the resources company. They present concentrated sessions, questions and access to information on a local level and give people more of an awareness of the opportunity.

Mr SYMON —David, I have a raft of questions for you. I would like to go back to this accommodation issue. My background is construction. I spent many years travelling to work. I note in your submission that you note:

Initially, job seekers will often need to stay in temporary accommodation, such as boarding houses, backpacker lodging or even in camping grounds …

To me that is not a very attractive accommodation option, not the sort of thing I would pack up and cross the country for. I know the price of housing up in the Pilbara. I was up there in 2008 having a look, and I am sure it has only got worse since then. I note Barry Haase’s suggestion of Commonwealth provided boarding hostels. I am not sure what they actually are, but they seem to be somewhere in between. Is that one of the major impediments to people taking up jobs outside of where they live—not the fact that they may not know or understand the job and have to be trained but the fact that, when they get there, there is quite often very inferior or nonexistent accommodation provided?

Mr Thompson —I think you are spot on, given they may be out of their various family and social support networks and so on. The other thing to say is that people who are unemployed do not all have the same circumstances, the same needs et cetera. They are a very varied and complicated bunch of people, just like all the rest of us, so you cannot stereotype them. We need to make sure that they have accommodation which is of a reasonable standard and that they have access to, as I was saying earlier, support, mentoring or whatever you want to call it which helps them navigate the new community, new services and all the rest of it. It all needs to be organised and coordinated so that people will have a go at getting out of the ‘comfort zone’ where they are currently living and actually have a crack at something which—while on the face of it and initially somewhat challenging for them—if they can actually get used to, they might find incredibly rewarding, both economically and otherwise.

Mr SYMON —In your submission you talk about support through Job Services Australia for workers or soon-to-be workers relocating. What is your experience with employers providing money for that as well? The employers are obviously the ones that want the workers. When it comes to executives it is without a second thought that there will be a relocation package to get that particular worker to wherever they are needed. You are providing government funded support for workers to relocate under certain programs but what assistance is coming back from the employers with that?

Mr Thompson —There is another mindset change that might be needed there as well and it is that they will be prepared to pay a significant premium to private recruiters and so on to engage executives and relocate them. They may well not have the same mindset in respect to people at the unskilled end of the spectrum or people with relatively low levels of skill. I suspect a part of that is the extent to which their need for the labour gives rise to a recognition that they are going to have to make a contribution themselves. Before the Global Financial Crisis, when levels of unemployment and very long-term unemployment were heading south and participation rates were going up, employers were prepared to take on an awful lot of people they might not have in times when they could afford to be choosey. I suspect that as demand for labour in some of these regions continues to outstrip supply, they will be prepared to make contributions.

Mr SYMON —FIFO has obviously become far more commonplace in recent times and, depending on which city you currently live in, a little bit easier to access. Have you or any of your member organisations had any great success in connecting unskilled or semiskilled workers with FIFO employment?

Mr Thompson —Not to my knowledge. I do not think there is an awful lot of FIFO employment that involves unskilled labour. In many cases people need a variety of tickets to be able to work in some of these locations. But it is certainly something that could be explored. I am aware that there are some instances where FIFO is operating from Melbourne, Sydney and Brisbane to the other side of the country as well. Another question altogether is the extent to which FIFO arrangements are the best way of doing things.

Mr SYMON —That is another question. You also noted in your recommendations industry specific training in areas of high employment prior to people being sent to remote employment. From my own point of view, that would work for a FIFO purpose as well.

Mr Thompson —Yes, absolutely. The point is that you have to make sure the training is exactly what the employers need. If you can deliver it before they get there you save time, you do not have to deal with accommodation pre-employment and so on. It is a practical thing.

Ms O’DWYER —In your submission you speak of screening job seekers to ensure they fit with employers’ expectations. I am curious to know whether there are particular attributes before you even get to that point that would indicate to you whether somebody is more likely to be successfully relocated, such as the age of the person and the relative skill level they might have.

Mr Thompson —For any job, regardless of whether it involves relocation, people have to have what we call the ‘soft skills’ or the ‘employability skills’, the ability to turn up on time, to be well presented, to fit in in the workplace, to be enterprising—the things that employers have always wanted in prospective employees. Added to that is the particular occupational or vocational skills they need, the tickets they might need. Then we need to make sure there are not other issues that are going to make it not work; for example, their need for social support, their connections to their families and whether there are other issues. Literacy and numeracy do not fall into that. That is another bit of training they have to get. Many—not all—will have non-vocational barriers that need to be dealt with and addressed. Taking people to a completely different location that is often significantly removed from where they presently live will exacerbate things that are getting in the way if they are not effectively dealt with. This is especially true for young Indigenous people and other people who might otherwise be a bit vulnerable—the importance of that sort of mentoring and support in the new location just to help them make the transition. I go back to reflecting on my own time. I would have been about 20 when I was living in a tent in Karratha. It was very tempting to think about getting on a plane and getting right out of there because it was so far from home. I do not think I was being a sook but I did feel quite homesick, and suspect a lot of people will until they get used to being in a new location.

Ms O’DWYER —The other way of asking that question might be: are there particular attributes or characteristics of individuals who in your experience and background would indicate that they would not be able to be successfully relocated and therefore when we look at putting together recommendations on this committee we ought to narrow our focus to those people who will be most successfully relocated.

Mr Thompson —Indeed. An example is the significant number of older, generally single males who used to work in manufacturing or local and state governments. They have relatively low levels of skill and not many contemporary vocational skills. They will frequently have some mental health issues—depression—and may also have muscular or skeletal disability—bad backs. There are large numbers of those people in the ranks of the extremely long-term unemployed. We probably should not think of them being first in the queue. That then means we have to think of something else for them, of course.

CHAIR —Thanks. I want to check a few last bits of information from you about your key recommendation, the establishment of some sort of relocation employment service or fund. Are there any models working anywhere that you would recommend as a guide or as the basis upon which to establish such a fund or program.

Mr Thompson —No, certainly not in this country. It is pretty hard to import things from other comparable countries without Australianising them. If Minister Arbib were to say to me, ‘What would you do to make this work?’ I would say, ‘Sit down with some experienced employment services practitioners—and there are plenty of them around—and some of the relevant HR people from some of the employers concerned and some of your own departmental officials and design a system that meets everyone’s needs and is not ridden with red tape like some of the current arrangements.’

CHAIR —That impression has come to us already. People have found that there is a lot of red tape around various employment service programs and a lot of rigidity around how the $5,000 can or cannot be spent.

Mr Thompson —Yes. I do not want to keep going back into history but I can recall when Ian Campbell, now the Secretary of the Department of Veterans’ Affairs, was a first assistant secretary of the department in 1997-98. He implemented the first iteration of the Job Network. He was sitting at his desk in his office in Mort Street, Canberra. He pointed to the CES manual, the 14 A4 ring binders under which the CES used to operate, and said, ‘The last thing we need in this new system is this many rules.’ What he was saying was that rules strangle innovation and constrain people in the sorts of things they need to do. I am pleased to be able to tell you that Minister Arbib and Lisa Paul, the Secretary of the department, are collaborating with us on an external review of some of the red tape in the current system with a view to finding ways of getting back to a space where there is a lot more room for innovation and people do not feel constrained. The only thing that really matters is getting sustainable and durable employment outcomes for people rather than getting tied up in lots and lots of rules. That collaboration with the department and the minister is happening now and we hope it will yield some useful results before the end of the year, when the next iteration of the employment services system, to operate from 1 July 2012, has got to be settled.

CHAIR —And we hope that our recommendations might land in that space.

Mr Thompson —That is very good.

CHAIR —Before I close, I want you to be aware that we are conscious of the work that is being done by the resources industry task force. I think there has been a bit of an emphasis on the resources sector in this space rather than industry more broadly. We are also very conscious of the changes in the migration area. We are not trying to duplicate the work that is being done. To that extent, if there are other smaller ideas or government policies that you think should be tweaked, please do not hesitate to contact us and draw them to our attention. I am talking quite broadly in terms of assisting employment services. I will give you an example. There might be certain incentives that we might be able to recommend for employers who, for example, overtrain in an area—take on more trainees and apprentices than they need. It is quite apparent from the Skills Australia report that, once you gain those initial skills or qualifications, you automatically become more employable and also more prepared to become mobile as an individual. You might be able to recommend things in that area. You might also be able to recommend things in the area of English-language tuition or literacy training. Again, using the Skills Australia report, literacy and numeracy seem to be significant barriers to gaining any kind of employment, let alone being prepared to relocate to take on employment. We would certainly be interested in those things. Before I close, I will hand you back to Rowan Ramsey.

Mr RAMSEY —David, there is something I had highlighted in your last recommendation and which I neglected to ask about. You refer to ‘harvest labour service’. What is that?

Mr Thompson —It is a strand of the employment services system where organisations are contracted to connect people looking for work in the harvest labour space with employers in the harvest labour space. So it is a brokerage-type arrangement.

Mr RAMSEY —So this is an agricultural picking exercise.

Mr Thompson —Yes. Chair, in response to your remarks, I think one of the things that I am particularly interested in pursuing is—I am trying to think about how to put this simply—doing whatever it takes to get a lot more Indigenous people, especially young Indigenous people, into work in some of these locations. We tend to stereotype Indigenous people as having very significant disadvantage, and of course in many ways that is probably true, but I think that can lead us into the trap of not thinking the other way, about significant capability as well. As I said earlier, I have just come away from a three-day conference in Alice Springs addressing some of these issues, and I will arrange for the committee to get some material that will be outputs from that conference, which I acknowledge was supported by the government and others. As I said at that conference, I have a great big hope that we can do far better than we have for a long time in this country in terms of getting Indigenous people into employment in this context as well.

CHAIR —Thank you very much. Perhaps I will try to make sure I put you in contact with the Clontarf Foundation in my own state, which has one of the best records I have ever seen for sustainable employment for young Indigenous people.

Mr Thompson —I do not want to prolong this, but we had 10 Indigenous people telling their stories of their journeys through education and training into employment. In many cases, those journeys were very difficult. We are producing a DVD of their stories. You have to say that they had phenomenal success and phenomenal determination to get to success. I think it reinforces a view that I think we need to adopt more often, and that is to think about the positives and the capabilities rather than in terms of deficits.

CHAIR —Sure. David, I have really appreciated your evidence this morning. Rest assured that we have the people who actually operated the trial of the previous relocation program appearing before us on 25 June, so we will be going through how the scheme did or did not operate in some detail. Thank you very much for participating. Again, thank you for your submission. I note that you have offered to provide additional material, and I would ask that you forward that to the secretariat of the committee.

Mr Thompson —I will do that, yes.

CHAIR —You will be sent a copy of the transcript of your evidence today, to which you can make corrections of grammar and fact. On behalf of the committee, thank you very much for participating. That was extremely useful.

Mr Thompson —Thank you. It is a very important piece of work you are doing.

[10.00 am]