Melbourne, Nov 7 (The Conversation) Last year the federal government replaced the jobactive employment support program with what was expected to be a more flexible and improved support system for jobseekers, Workforce Australia.
Yet, in the 16 months the contracted-out system has been running, almost 2 million income support payments have been suspended, affecting 70 per cent of participants.
Under the new system, participants must meet a points target to receive payments.
For example, if the default points target is 100 per month, this can be met by a minimum of four job applications (worth 5 points each) and a mix of other activities. Points targets are adjusted to 60 per month for parents and people with disabilities.
Payment suspensions are supposed to get people to comply with requirements such as attending job interviews and undertaking training, education classes or other activities to reach their points target.
When these criteria are not met, participants are given a two-day grace period to resolve the problem, after which payments are automatically suspended. The suspension remains until the target is met or the suspension is lifted by a job service provider. The average suspension period is four days.
The figure of almost 2 million payment suspensions, cited at a Senate Estimates committee meeting last month, showed they have been occurring at an alarming rate since Workforce Australia started.
Committee member and Greens senator Janet Rice highlighted concern about the high suspension rate and representatives from the Department of Employment, which runs the program, agreed it was an issue.
If 70 per cent of participants have been suspended, that makes it very likely some people have lost payments multiple times. These people might be long-term unemployed due to health, disability or discrimination in the workplace.
Suspending payments to these already disadvantaged groups has a devastating impact because income support payments are grossly inadequate. The single person rate of JobSeeker payment is only USD 749.20 per fortnight, and the maximum rate of Commonwealth rent assistance is USD 101.07, adding up to USD 860.27 a fortnight.
Meanwhile an average share house rent in a capital city like Melbourne is USD 446 per fortnight - with single renters often paying double - and this leaves people without much room for delays to their income support payments.
Research into the impact of payment suspensions on people’s mental health shows the consequences are dire.
This is especially so during the current cost-of-living crisis when people have enough to worry about just paying rent, buying food or keeping a car on the road.
The harm caused by suspending payments is apparent in my recent analysis of the individual submissions to the parliamentary inquiry into Workforce Australia.
I coded the frequency of words relating to poor psychological wellbeing as represented in the table. Of the 69 submissions reviewed, 52 identified how payment suspensions caused high levels of stress and affected trust of the job service provider.(The Conversation) RUP