The unemployed in Australia have been betrayed yet again

A Liberal Party dominated Australian House Of Representatives Select Committee on Intergenerational Welfare Dependence betrayed vulnerable Australians in April 2019.

However, neither the Labor Party nor Centre Alliance can walk away from the shameful part they played in this betrayal.

The Age, 23 July 2019:

A bipartisan call to increase the Newstart allowance was removed from a parliamentary report at the direction of the Morrison government on the eve of the federal election.

As Prime Minister Scott Morrison stares down growing demands by Coalition MPs to lift the unemployment benefit for the first time since 1994, The Sydney Morning Herald and The Age can reveal former social services minister Paul Fletcher intervened in an inquiry to erase a major recommendation that would have turbo-charged the sensitive issue.

The probe into the causes of long-term welfare was established by the government in mid-2018 to investigate why some Australians become trapped in the system.

The draft final report - agreed to by MPs from the Coalition, Labor and crossbench - contained a specific call to lift the Newstart payment for singles and families.

But sources said Mr Fletcher demanded to review the recommendations before they were publicly released in April and is understood to have told the committee chair - veteran Liberal MP Russell Broadbent - that the final report could not contain the specific Newstart recommendation.

The committee, which included Liberal MPs Kevin Andrews, Bert van Manen, Ben Morton and Rowan Ramsey, as well as Labor MPs Ged Kearney and Sharon Bird, was then hastily reconvened to change the wording of the report.

The opposition's policy at the time was to merely review Newstart rather than raise it.

Following Mr Fletcher's intervention, MPs agreed to only recommend an examination of the "adequacy of payments on young people and single parent families".

In a sign of the growing sensitivity of the issue, Mr Morrison on Tuesday warned Coalition MPs against airing personal views, telling them "government is not a blank cheque" and that they disrespected colleagues by pursuing personal policy agendas.

Amended Final Report can be found here.

Australian Parliamentary Library Briefing Book, retrieved 18 July 2019;

From 20 March 2020, Newstart Allowance will be replaced by a new JobSeeker Payment. Over time a number of other working age payments such as Sickness Allowance and Widow Allowance will end and recipients will also move to the JobSeeker Payment. The new payment will have the same payment rates and indexation arrangements as Newstart Allowance. This is part of a 2017–18 budget measure that aims to simplify the income support system. [my yellow highlighting]

SNAPSHOT: Employment, underemployment & unemployment in NSW & Northern Rivers Region - April & May 2019

Australian Bureau of Statistics (ABS), Labour Force, Australia, May 2019:

·         Australia's trend estimate of employment increased by 28,400 persons in May 2019, with:

·         the number of unemployed persons increasing by 5,800 persons;

·         the unemployment rate remaining steady at 5.1%;

·         the underemployment rate increasing to 8.5%;

·         the underutilisation rate increasing to 13.6%;

·         the participation rate increasing to 65.9%; and

·         the employment to population ratio remaining steady at 62.5%. 

In New South Wales, May 2019

Total employed person – 4,167,000 persons of which est. 31% are employed part-time

Total underemployment rate – 12.2%

Total unemployed person – 197,500 persons of which est. 68% were looking for full-time work

Total unemployment rate – 4.5%.

State Electorates in Northern Rivers, April 2019

Clarence Electorate – 58,169 employed persons, unemployment rate 8.2% and youth unemployment rate 20.5%, with negative annual employment growth of -2.7%

Lismore Electorate – 83,833 employed persons, unemployment rate 6.1% and youth unemployment rate 10.2%

Richmond-Tweed Electorate – 115,668 employed persons, unemployment rate 4.5% and youth unemployment rate 8.9%.

So how is Australian wage growth faring so far in 2019?

If one looks at national averages for wage growth or compensation of employees (COE) in March Quarter 2019 it looks as though no-one has been left behind.

However, first glances can be deceptive. 

Australian Bureau of Statistics, 5 June 2019:

COE increased 1.2% and average compensation per employee rose 0.4%.

Private COE grew 1.4%, while public COE increased 0.7%.

In the March Quarter 2019 there was negative wages growth in Tasmania, Northern Territory and the Australian Capital Territory (ACT). 

With a seasonally adjusted  -0.4% total change to pre-tax wages in Tasmania, a -0.3% total change to pre-tax wages in the Northern Territory and -0.4% total change to pre-tax wages in the ACT.

While March Quarter 2019 total percentage changes in pre-tax wages growth for the remaining states was:

Victoria 0.7%

Queensland 0.8%

New South Wales 1.6%

West Australia 1.7%

South Australia 2.0%.

Note: Compensation of Employees (COE) represents total gross (pre-tax) wages paid by employers to employees for work done in March Quarter 2019 accounting period.

Seasonally adjusted there was a 0.5% change in total hourly rates of pay excluding bonuses in Australia between December Quarter 2018 and March Quarter 2019.

Other factors to consider alongside wages……..

According to the ABS the Cost Price Index (CPI) rose 1.3 per cent per cent through the year to the March quarter 2019, after increasing 1.8 per cent through the year to the December quarter 2018.

In March Quarter 2019 CPI remained flat due to reduced costs in automotive fuel and domestic/international holiday travel & accommodation. Although over the last twelve months, food and non-alcoholic beverages group costs rose 2.3% and, in seasonally adjusted terms food and non-alcoholic beverages group rose 1.2% this quarter. While in seasonally adjusted terms this quarter education group costs rose 0.3% and health group rose 0.7%.

Again according to the ABS the trend unemployment rate remained steady in New South Wales, Victoria and South Australia. It decreased by 0.2 percentage points in the Northern Territory and by less than 0.1 percentage points in Queensland and Western Australia. It increased by 0.1 percentage points in Tasmania and the Australian Capital Territory. Over the year, the unemployment rate fell in all states and territories except for Tasmania, the Northern Territory and South Australia.

Australian economy has grown weaker and workers paypackets leaner under the Abbott-Turnbull-Morrison Government

ABC News, 11 May 2019:

Australia's "strong economy" has been the Coalition's mantra throughout the election campaign.

Earlier this month, the Liberal Party created a meme of a smiling Scott Morrison armed with a lightsaber and dressed as a Jedi alongside the slogan: "The economy is strong with this one."

In Treasurer Josh Frydenberg's Budget speech, the phrase "strong economy" featured 14 times.

And Labor, loathe to campaign on what it sees as the Coalition's territory, has barely challenged this proposition.

Yet the evidence suggests the claim is more rhetoric than reality.

On just about any measure, the economy is not strong — and any enduring pretensions that it is have been undermined by no less an authority than the Reserve Bank of Australia (RBA).

Its latest monetary policy statement has revised down economic growth for this financial year to just 1.7 per cent — more than half a percentage point below its previous forecast.

That contradicts Treasury forecasts in the Budget, which are barely a month old and were reaffirmed by Treasury even more recently in the pre-election economic and fiscal outlook.

Wages growth, despite a recent small pick-up, has been weaker during the past six years than at any time since World War II.

Home values and household wealth have plummeted amid one of the biggest property slumps in Australia's history.

The inflation rate is at a historic low of just 1.3 per cent and has languished below the Reserve Bank's target range of 2 to 3 per cent for more than three years.

Although employment growth has been reasonably strong, driven by the public sector and community services, key sectors that drive the economy are shrinking.

Manufacturing, construction and retail trade have all shed tens of thousands of jobs over the past year — the building industry layoffs are a product of a massive slump in dwelling investment, which the RBA reckons will continue for years.

Some better headline data mask gloomier realities

Only high rates of immigration have stopped Australia lapsing into a formal recession.

The continued expansion — now in its 28th year, the longest period without a recession in recent world history — disguises a "per capita" recession that is driving down living standards.

Similarly, an unemployment rate mired at 5 per cent, which is not high by the standards of recent decades, disguises the true weakness of the labour market.

More than 13 per cent of the workforce is underutilised — either unable to secure work at all or the hours they need — and a disproportionate share of the jobs growth in recent times has been poor quality: casual and contract jobs in relatively low-wage, low-productivity sectors.

The Reserve Bank is betting on the unemployment rate staying where it is, but others are less optimistic.

Westpac's Bill Evans, one of the most long-standing and respected market economists, predicts that developments in the labour market over the next three months will disappoint the RBA with a "deterioration of the labour market" over the coming six months and "continued weak inflation".

This downturn in the economy is largely homegrown — the product of weak wages growth and the unwinding of an unsustainable property boom that left households saddled with enormous debts.

If there's also an external shock, perhaps from a trade war sparked by Donald Trump's tariffs on our largest trading partner China, it will open up the possibility of a double-whammy.

Yogi Berra, the legendary US baseball star and coach, famously observed that "it's tough making predictions, especially about the future", and it's a maxim that's often born[e] out in economic forecasting.

But you don't need a crystal ball to realise that whoever forms government after the federal election will inherit a sluggish economy, not a strong one.

ABC News, 12 May 2019:

The Reserve Bank's new line in the sand gets its first big test with the latest reading from the jobs market this week.

The new line, as set down in the RBA's latest Statement on Monetary Policy (SOMP), can be roughly defined as the unemployment rate holding at 5 per cent through 2019 and 2020 before drifting lower.

The persistent head-winds of low inflation has seemingly blurred, if not blown away, the RBA's previous markers — parallel lines which were intended to corral inflation between 2 to 3 per cent for as far as the eye can see, or an economist can forecast.

Governor Philip Lowe made it clear a further improvement in the labour market was needed to get the economy out its rut and back in the groove, growing at its full potential.

No back-tracking on this one for the RBA. Lower unemployment and underemployment — where workers are searching for more hours to make ends meet — will soak up the spare capacity sloshing around the economy, inflation gets back to where the RBA wants it and GDP grows at its long term trend, or better.

That's still a long way off, even using the RBA's recently updated and far from pessimistic forecasts......

According to the Australian Bureau of Statistics, over the twelve months to the March quarter 2019 the living costs for self–funded retiree households fell by -0.2%, while the living costs for age pensioner households and other government transfer recipient households rose by 0.3% and 0.2% respectively. Employed households living costs remained unchanged over the same time period at 0.1% above CPI.

It should be noted that penalty rates for retail workers will be further reduced by 15% of the base wage rate on 1 July 2019 and 1 July 2020 as per Fair Work Commission 2017 decision.

“Welfare-to-work” is now a billion-dollar industry which consistently fails vulnerable jobseekers

The Guardian, 4 May 2019:

“Welfare-to-work” is now a billion-dollar industry. Providers compete for the lucrative contracts, worth $7.6bn to the taxpayer over five years when the last round was signed in 2015.

Proponents for the privatised system argue the model is much cheaper and boasts a better cost-to-outcome ratio.

But myriad reports – including recent findings from a Senate committee and a government-appointed panel – have found the most disadvantaged jobseekers are being left behind.

In 2002, a Productivity Commission report that was largely supportive of the then-new privatised model still warned “many disadvantaged job seekers receive little assistance … so-called ‘parking’”. That practice still occurs under this name today, according to employment consultants who spoke to Guardian Australia for this story.

When a person applies for Newstart, they are assigned a Jobactive provider and placed into one of three categories ordered by the level of assistance they might need: streams A, B and C.

The outlook for the most-disadvantaged jobseekers is bleak: only a quarter will find work each year. Overall, 40% of those receiving payments will still be on welfare in two years. While Jobactive has recorded 1.1 million “placements” since 2015, one in five people have been in the system for more than five years.

New data provided to Guardian Australia by the Department of Jobs and Small Business shows about 1.9 million people have participated in Jobactive between July 2015 and 31 January 2019. In that time, 350,000 – or 18% – have been recorded gaining employment and getting off income support for longer than 26 weeks.

And of those 350,000, only 35,852 – or 10% – had been classified as disadvantaged in Stream C.

Since Lanyon was placed on Jobactive, he’s had eight job interviews and sent in about 150 applications. Eighteen months ago he says he slept in his car and showered at a homeless shelter after finding work close enough to take but too far away for a daily commute.

He knows his chances of getting back into work diminish each day he’s out of the workforce.

Tweets of the Week

Michael Murray, general manager of Cotton Australia

Mr Murray said the decision 18 months ago to drain 2,000 gigalitres of water from the Menindee Lakes was in hindsight “probably a poor decision”.

You fucking think so? #auspol

— Des Devlin (@desdevlin38) January 10, 2019

State of Play: NSW North Coast Employment Opportunities

It's a brand new year but in regional New South Wales the old issues followed us past midnight on 31 December 2018.

Employment opportunities - where will our unemployed and underemployed people find a job in 2019 and beyond?

This is how the old year ended.....

NSW North Coast -Summary Data

List of summary data inNorth Coast
Data Name	Data Value
Unemployment Rate (15+):	6.1%
Unemployed (15+):	7,000
Total jobactive Caseload (15+):	10,643
Youth jobactive Caseload (15-24):	1,779
Mature Age jobactive Caseload (50+):	3,562

Download Summary Data in Excel

http://lmip.gov.au/default.aspx?LMIP/GainInsights/VacancyReport

The future appears to be a mixed bag for the NSW North Coast over the next twenty-four years. 

At which point the population may have reached somewhere in the vicinity of 400,000 residents.

However, it is expected there will be a drop in employment levels across Agriculture, Forestry & Fishing on the North Coast.

While Manufacturing only grows slightly in the Richmond-Tweed region and remains static same elsewhere.

Wholesale Trade remains steady in Tweed-Richmond with up to 300 new jobs, but is projected to go backwards in Coffs Harbour-Grafton over the next 24 years.

Retail Trade is predicted to grow modestly across the North Coast, with 900 new jobs predicted.

The Accommodation and Food Services sector is expected to show unspectacular growth right across the North Coast regions with only 900 additional jobs.

Administrative and Support Services employment is projected to rise - but only by 700 jobs up to 2023 and Public Administration & Safety are only expected to add 300 jobs over that same time period.

The Education sector is expected to grow by 700 jobs.

Information, Media & Telecommunications is expected to grow by 8.4% but it will take 24 years to achieve this small improvement on May 2018 figures and barely represents an est. 100 jobs overall.

Financial and Insurance sector employment opportunities are expected to diminish across the regions, but there are expected to be 500 more jobs in the Professional, Scientific & Technical Services.

Transport, Postal & Warehousing employment is predicted to remain at near present levels.

The Mining sector is not expected to grow past May 2018 levels on the North Coast from the Clarence Valley up to the NSW-Queensland border taking in all seven Northern Rivers local government areas.

However Construction employment is expected to grow by 15-16% by 2023 across the region. This represents est. 3,000 more jobs above May 2018 numbers.

Healthcare & Social Assistance is also predicted to grow by 3,900-4,000 available positions by 2023.

See the following Labour Market Information Portal links for further employment projections for regional Australia, including the NSW North Coast:

Employment projections for the five years to May 2023

Each year, the Department of Jobs and Small Business produces employment projections by industry, occupation, skill level and region for the following five-year period. These employment projections are designed to provide a guide to the future direction of the labour market, however, like all such exercises, they are subject to an inherent degree of uncertainty.

The 2018 employment projections are based on the forecasted and projected total employment growth rates published in the 2018-19 Budget, the Labour Force Survey (LFS) data (June 2018) for total employment, and the quarterly detailed LFS data (May 2018) for industry employment data.

2018 Industry Employment Projections Report (Word) (245.0KB)

Industry projections – five years to May 2023 (Excel) (49.3KB)

Occupation projections – five years to May 2023 (Excel) (80.4KB)

Skill Level projections – five years to May 2023 (Excel) (24.6KB)

Regional projections – interactive tool (Excel) (2.2MB)

Regional projections – five years to May 2023 (Excel) (921.3KB)

2018 Gender Employment Projections Report (Word) (116.7KB)

Just three months out from a state election and the NSW Berejiklian Government decides to introduce a new punative public housing policy guaranteed to upset a good many voters

In 2016 est. 37,715 people in New South Wales were recorded as homeless on Census Night.

The following year the NSW Berejiklian Coalition Government had a public housing stock total of 110,221 dwellings and an est. 60,000 people on the Dept. of Housing 2017 waiting list.

Below is the state government’s answer to the effects of decreasing public housing stock and federal Coalition Government cuts to public housing funding allocations to the states - introduce a new initiative under the 'Opportunity Pathways' program which will cut the housing waiting list by increasing eligibility restrictions, privatise service delivery to certain categories of public housing applicants and tenants in order to ensure that vulnerable individuals and families are discouraged from seeking housing assistance.

The Daily Telegraph, 7 December 2018, p.2:

Public housing applicants will have to get a job if they want a taxpayer-funded home under a tough new test to be introduced in NSW.

The state government is overhauling the public housing system by stopping residents who languish on welfare for decades feeling entitled to a cheap home, paid for by the taxpayer, for their entire life.

Currently less than a quarter of social housing tenants are in the workforce. There are about 55,000 people on the public housing waitlist in NSW, and under the new program they will be able to skip the queue if they agree to get a job.

But if they get into the home then fail to get a job or maintain work they will be booted from the property.

Once they are secure in a job they will then move into the private rental market and out of the welfare system.

Social Housing Minister Pru Goward said the program will “help break the cycle of disadvantage”.

“This is about equipping tenants with the skills they need to not only obtain a job, but keep it over the longer term and achieve their full potential,” she said.

“We also want to set to a clear expectation that social housing is not for life and, for those who can work, social housing should be used as a stepping stone to moving into the private rental market.” The new program will be trialled in Punchbowl and Towradgi, near Wollongong, for three years across 20 properties. Its success will be evaluated over this time and it’s likely the program will be expanded across the state.

Homes will be leased for six months at a time, with renewal dependent on the resident maintaining their job or education, such as TAFE, and meeting agreed goals within the plan.

NSW eTendering:

RFT ID FACS.18.30

RFT Type Expression of Interest for Specific Contracts

Published 23-Aug-2018

Closes 27-Sep-2018 2:00pm

Category (based on UNSPSC)
93140000 - Community and social services

Agency FACS Central Office

Tender Details

The NSW Department of Family and Community Services (FACS) is seeking Expressions of Interest (EOI) from non-government organisatons with the capability to deliver the Opportunity Pathways program.

Opportunity Pathways is designed for social housing tenants and their household members, approved social housing applicants and clients receiving Rent Choice subsidies who aspire and have the capacity to, with the appropriate support, gain, retain and increase employment.

The program is voluntary and uses a person-centred case management approach to provide wrap-around support and facilitate participant access to services to achieve economic and housing independence (where appropriate).

The objectives of the program are to:

assist participants to gain, retain or increase employment, by accessing supports and practical assistance, and by participating in education, training and work opportunities

encourage and support participants to positively exit social housing or Rent Choice subsidies to full housing independence, to reduce their reliance on governement assistance, where appropriate

Please refer to the Program Guidelines for further details.

Opportunity Pathways will run for three years and delivered across NSW in those locations where a need and service gaps are identified.

The program will be delivered by one or more providers following an EOI and Select Tender.

Location

NSW Regions: Far North Coast, Mid North Coast, New England, Central Coast, Hunter, Cumberland/Prospect, Nepean, Northern Sydney, Inner West, South East Sydney, South West Sydney, Central West, Orana/Far West, Riverina/Murray, Illawarra, Southern Highlands

Estimated Value

From $0.00 to $36,100,000.00

RFT Type

Expression of Interest for Specific Contracts - An invitation for Expression of Interest (EOI) for pre-registration of prospective tenderers for a specific work or service. Applicants are initially evaluated against published selection criteria, and those who best meet the required criteria are invited to Tender (as tender type Pre-Qualified/Invited). [my yellow highlighting]

As of June 2018 in NSW there were 200,564 people registered with Centrelink whose income was Newstart Allowance and, by September there were only est. 82,400 job vacancies available as the Internet Vacancy Index had been falling since April 2018. The number of job vacancies were still falling in October 2018 to 66,000 job vacancies.

Just three months out from a state election and it doesn't appear that the Berejiklian Cabinet or other Liberal and Nationals members of the NSW Parliament have thought this new policy through to its logical conclusion.

Will a minority Morrison Government be forced to raise Newstart & Youth Allowances?

Depending on where you live in New South Wales the unemployment rate in September 2018 ranged from 2% to 9%, while youth unemployment went from 4% to 24%.

At the same time employment growth was -3% to barely 10%.

Which means that in September there were est. 195,300 job seekers on Centrelink's books in NSW and only est. 82,400 job vacancies available.

Centrelink Newstart Allowance for a single jobseeker is currently $275.10 per week and Youth Allowance is $222.90 per week for a single jobseeker under 21 years of age.

The million dollar question many people struggling on meagre unemployment benefits in rural and regional NSW will be asking themselves is whether Adam Bandt, Cathy McGowan, Kerryn Phelps, Andrew Wilkie, Rebekha Sharkie, and Bob Katter will use the increased bargaining power which comes to the crossbench in a minority government to force the government's hand on this welfare payment issue. Or will they turn to water?

Here is where the crossbench stands now.....

The NewDaily, 16 November 2018:

Pressure is mounting on the Coalition government to raise the Newstart rate following unanimous lower house crossbench support for a $75 increase.

The Guardian, 16 November 2018:

The entire lower house crossbench has come out in favour of an increase to Newstart, prompting Australia’s peak body for the community services sector to accuse the major parties of being out of touch.

Bob Katter outlined his support for an increase to the unemployment benefit on Friday, saying it would help tackle malnutrition in Indigenous communities.

His statement follows Rebekha Sharkie calling for an increase earlier this week, while the new Wentworth MP Kerryn Phelps committed to raising the payment in a candidates’ survey during the byelection campaign.

Cassandra Goldie, the chief executive of the Australian Council of Social Service, said the “diverse crossbench’s unity on increasing Newstart confirms just how out of touch the major parties are on this issue”.

“When Adam Bandt, Cathy McGowan, Kerryn Phelps, Andrew Wilkie, Rebekha Sharkie, and Bob Katter all agree, it’s time to stop talking and act,” she said.

Katter said the payment was insufficient for those in regional Queensland, where the cost of finding a job was high.

“If you’re outside of Brisbane, it’s no car, no job,” he said.

Increasing the dole “would go a long way to enabling First Australians to buy fresh fruit and vegetables”.

“You’ve crucified us with the cost of food, you’ve crucified us with the cost of electricity,” he said. “We can’t possibly live on Newstart.”

The prime minister, Scott Morrison, has said the government had no plans to increase the payment – currently $275.10 a week – despite an improved budget position, saying “I don’t think you can all of a sudden go ‘oh, let’s make whoopee’”.

He said earlier this month that the government would be more inclined to increase the pension, which stands at $458.15 a week. The pension was increased during the Gillard government while Newstart was last raised in real terms in 1994.

Labor has not committed to lifting Newstart, but signalled it would use a “root and branch review” to argue for an increase.