ACOSS today welcomed the Prime Minister’s plan to improve workforce participation, especially for people on income support.

“Improving workforce participation is a ‘win win’ policy for people on social security and the economy. ACOSS has consistently advocated policies to improve employment assistance and incentives for jobless people on income support,” said ACOSS CEO, Dr Cassandra Goldie.

“One of biggest disincentives is the $130 per week gap between Newstart Allowance (NSA) and Disability Support Pension (DSP). If the payments were equal, then fewer people with disabilities would need to claim the pension.

“Restricting the recent social security increases to pensioners made matters worse. To redress this inequity, we support the Henry proposals for a $50pw boost to single unemployment payments, which are currently only $235 per week.

“There are also major disincentives for sole parents and people with disabilities on NSA to take up part time work – on the pension they only lost 40 cents in benefits per dollar earned , on NSA they lose 60 cents. This often means that there is no financial reward for working 2-3 days a week on minimum wages (which is often the only work social security recipients can get).

“There was a rule under the previous Coalition Government that parents cannot be forced to take up a job unless they are $20pw better off after tax and child care costs, but this is not being enforced.

“But the main problem is not lack of incentive, it is lack of work capacity or employer acceptance: around one in eight NSA recipients are assessed as having a disability, and one in four long term unemployed recipients has less than Year 12 education, and around in six NSA recipients are of mature age (50+).

“So the main solution is investment in employment counselling and training to boost work capacity and policies to encourage employers to take unemployed people on, such as wage subsidies and more help to employers to adapt workplaces for people with disabilities (for example employment services could guarantee that trained relief staff are available when someone with an episodic illness cannot attend work).

“At present, Job Services Australia providers get enough funding to pay for an interview every 2 months and $500 for training and other assistance for a typical long term unemployed person. In its submission to the Government on JSA, ACOSS is urging the Government to invest more in employment services because this will save money and improve lives in the long run, especially where people would otherwise remain on income support for a long time,” Dr Goldie said.

Media Contact: Fernando de Freitas 0419 626 155