ACOSS’s advocacy on Mutual Obligations and Employment Services

ACOSS advocates for full employment, and a fairer system of mutual obligations and more effective employment services. Our current priorities for reform in the ACOSS Budget Priorities Statement – A Submission to the Treasurer 2023-2024.

The House of Representatives Inquiry into Workforce Australia released its report in November 2023. It recommends root and branch reform of employment services and mutual obligations. Here are our media release and a briefing on the report (published in March 2024) including proposed reforms of employment services and the unemployment payment suspensions and penalty regime. In the briefing, we advocate five first steps for reform.

Reduce payment suspensions and penalties

ACOSS is deeply concerned at the widespread use of automated income support payment suspensions for breaches of activity requirements, many of which are minor infractions such as missing a provider appointment. It is unjust and harmful to people’s financial security and mental health to deny them income support without the opportunity to discuss the matter first with a public official at Centrelink.

As outlined in our briefing on payment suspensions, over the three months to June 2023, 240,000 people – almost half of all people on unemployment payments in Workforce Australia services – had their payments suspended.  

Under the present penalty system, payments are automatically suspended if people miss an employment services appointment and don’t make contact within two working days to seek another meeting. In many cases people weren’t even aware of the appointment. The same thing happens if people don’t report on time that they’ve applied for the required number of jobs (whether or not they made the applications). 

Automation of payment suspensions recalls the Robodebt experience where large numbers of people were automatically sent debt notices, many of them wrong.  

We are calling for the following changes to the penalty regime: 

  • Decisions to suspend a person’s payment should be made by appropriate personnel at Services Australia;
  • Suspensions should not be used as the first resort, especially for minor infractions such as missing a provider appointment, and providers should have more discretion not to apply them;
  • Proper administrative law processes including human rights protections, should be adopted to ensure that the suspension is the least restrictive measure necessary, taking into account any personal vulnerabilities and the impact of a suspension on individual and their family financial circumstances (such as the risk of not being able to pay rent) and the seriousness of the breach.

Full employment

ACOSS advocates for full employment, where people seeking employment or more paid hours can find them without searching for too long, and jobs are properly paid and secure with decent conditions of employment.  

We set out our vision for full employment in 2022 in the Jobs and Skills Summit position paper and negotiated a Joint statement with the ACTU and BCA on full employment. 

In the lead-up to the Government’s Employment White Paper released in September 2023, ACOSS advocated for firm targets to retore full employment to inform its Budget policies and the interest rate policies of the Reserve Bank. We believe the Government’s Agreement on monetary policy with the Governor of the Reserve Bank (RBA) should include employment targets as well as a target to reduce inflation, and have been critical of excessive increases in interest rates which put jobs at risk.  

Following up our letter to the Treasurer on full employment, we undertook an informal briefing with the Treasury White Paper Task Force in September 2023 on measuring full employment – here are our briefing paper and notes from the meeting which included prominent economists. 

Reform employment services

There are over 800,000 people on unemployment payments of whom over 500,000 have received income support for more than 12 months. As our Faces of Unemployment report shows, in 2021 they included many people facing disadvantage in the labour market. Currently, 42% have disability, 42% are over 44 years of age, 15% have First Nations backgrounds and 12% are sole parents. 

To give them a fair chance of securing employment we propose root-and-branch reforms of employment services to lift investment in help that makes a difference and remove requirements to participate in programs that don’t such as Work for the Dole. In our submission to the House of Representatives inquiry into Workforce Australia we advocated: 

  • Removal of requirements for parents to participate in the Parents Next program (since implemented) 
  • An annual Jobs and Training Offer for people unemployed long-term including subsidised employment, vocational training, foundation skills, career guidance and support, and social or health support for those who need it. 
  • An independent quality assurance body with responsibility for licensing providers, setting and enforcing quality standards, sharing and supporting best practice, and improving responsiveness to service users (unemployed people and employers).  
  • A shift from competitive purchasing of services towards a grants model with more provider diversity including locally-based services 
  • Local employment and skills networks to embed employment assistance in local communities and improve coordination with other service providers, employers, unions and local governments so that the right people are connected to the right jobs and training opportunities 
  • Local partnership services for people facing entrenched disadvantage 
  • Effective representation of people using employment services in advisory arrangements.

Along with members and unions, ACOSS has written to the Employment Minister Tony Burke calling for major reform of employment services and an end to automated payment suspensions.