This post was first published as an article on the Australian on-line journal Eureka Street on April 26, 2019 under the title ‘My Newstart Conundrum‘. If you are able and think it worthwhile, please support Eureka Street with a donation.
Recently I was placed on the Federal Government’s Mutual Obligation program, otherwise known as ‘Work for the Dole’. This happened as a result of being on a partial Newstart payment for twelve months. I have been underemployed for around three years now and Newstart provided a welcome top-up as I continued to look for more work.
Each Newstart recipient is given a Job Access Provider (JAP) to help them look for work. My JAP informed me that I was required to do 21 hours per week of Mutual Obligation activity. This was in addition to looking for work, made up of applying for at least 20 jobs every four weeks.
My JAP worker assured me that the 21 hours per week would help me to remain motivated and focused on the task at hand: finding work. I replied that I would now have to stop doing the things that were keeping me motivated to satisfy my Mutual Obligation requirements.
I live in Western Sydney. My JAP had me volunteering with a Christian outreach program doing good things in the area for people living with significant financial and personal disadvantage, largely via housing and food initiatives. It is safe to say that many of these people are unemployed.
After four weeks on ‘Work for the Dole’ I decided that it was best for my own well-being to go back to the things I had been doing to remain motivated. This meant coming off Newstart. Fortunately, I have good support. Others are not so fortunate.
The others with me doing their own Mutual Obligation hours were diverse: people living with various forms of mental and emotional disorder deemed by their JAP and the Federal Government as employable. There were also people with differing physical conditions similarly assessed as employable. Add to this underemployed people and itinerate workers between jobs. One person I spoke to, who was an underemployed casual teacher, said that her Newstart benefit was paying her rent.
A common experience of those I spoke with during this time was that their long-term experience had been one of a slow decent into hopelessness and powerlessness. The combination of an inadequate Newstart while searching for 20 jobs a month plus compulsory Mutual Obligation, (as well as, for some, underemployment), had become overwhelming.
A recent federal budget news report contained an estimation that 28,000 people in Australia have been receiving Newstart for more than ten years and that 60 per cent of all Newstart recipients have been on this benefit for more than 2 years. That’s a lot of job searching and Mutual Obligation required from people struggling to find enough work, or any work at all. In my view, this expectation is quite unreasonable.
Another issue relevant here is the idea of full employment. What exactly is it? The Reserve Bank had been, until recently, operating with the idea that full employment is 5 per cent, though it might now be lower – perhaps somewhere between 4 and 5 per cent. This means that there is little or no work currently available for 4 to 5 per cent of the population that are assumed to be work ready, let alone those who, realistically, are not.
What we now have in this country is a cohort of our fellow Australians who will never find work, or enough work. This fact is due to a combination of personal and systemic factors. Either they will be deemed unemployable by potential employers, or adequate employment options are just not there for them.
It is unjust to provide a sub-standard Newstart allowance and compulsory Mutual Obligation to those genuinely struggling to find adequate employment in a system that does not provide enough opportunity for employment. Is there an alternative?
Currently the tax-free threshold is $18,200 per year. What if we were to give all Australians of working age currently unemployed $18,200 a year. Those of us who are underemployed would be given enough money to also have us on $18,200 per year.
For example, if someone is earning $12,000 a year working, they would be given $6,200. Any income after $18,200 would be taxed at the normal rate, regardless of whether that income be from Newstart or employment. For the unemployed single, this would guarantee around $674 per fortnight in addition to a Newstart benefit of $555 per fortnight. This would mean that the single unemployed person would be on $32,396 per year after tax, much better than the current $14,985 per year (tax free). This is, of course, before any increase in Newstart.
As for the Mutual Obligation hours, let’s not make Newstart dependent on doing these hours, and let’s tailor the activities more towards each person and their circumstance. Yes, we might need practical encouragement to remain motivated, however, we may already be doing this for ourselves. Let the system recognise this.