Fairer Penalty Regime For Jobless, But Risks Remain

12 March 2009

ACOSS today welcomed the passing of legislation that does away with the present penalty regime for unemployed people. The Senate today passed the Employment Services Reform Bill, which introduces a fairer compliance regime.


Clare Martin, CEO, Australian Council of Social Service:

“Any compliance system should ensure people meet their requirements, not penalise the vulnerable. ACOSS is pleased that the Government is building a more equitable system for job seekers. The old system was unfair and didn’t take individual circumstances into account. Last year over 32,000 people lost their income support for 8 weeks.

“”As unemployment rises, more people will be accessing the services provided by Centrelink and employment service providers. The new system gives people greater opportunity to comply with the rules before they can be denied income support for 8 weeks.”

“We particularly welcome amendments to the legislation moved by the Australian Greens giving Centrelink more discretion to overturn penalties and to defer any loss of payment for a fortnight so that people have an opportunity to adjust to a lower payment.”

ACOSS is disappointed that the harsh and unreasonable 8-week penalty was not abolished but we hope that the number of people affected by it will be reduced by preventive action by providers and Centrelink. ACOSS will closely monitor the new system and work with the Government to ensure it reduces the number of penalties applied.

Any penalty regime carries risks for unemployed people, especially people who find it difficult to navigate complex rules, such as people with limited English, homeless people and people with mental health problems. ACOSS’ main concerns include:

• The loss of a day’s pay for everyday a person does not attend work experience or training.
• The affect of a late amendment in the Bill that could result in 8-week penalties for people who don’t show up for three days running. This aspect of the new system could be harsher that the old rules.
The changes include:
• Safeguards for unemployed people before an 8-week loss of payments is applied, including an individual assessment by Centrelink to determine if they had barriers to work that prevented them complying
• Unemployed people can ‘work off’ the 8-week penalty by participating in an activity like work for the dole
• A new ‘No Show No Pay’ penalty where a day’s payment is deducted for every day that a person does not comply with work experience or training requirements.

Media Contact: Clare Cameron – 0419 626 155