Welfare reform abolishes safety net

Issue 

BY ALISON DELLIT Picture

With its December 14 response to the final report of the Reference Group on Welfare Reform, the McClure report, the federal government has taken a giant step down its desired path of restructuring the entire welfare system.

By dressing its efforts in the garb of "helping welfare recipients", the government was able to use the McClure report to tie the organisations which make up the welfare sector to the goal of "welfare reform".

More importantly, the government was able to use the McClure report to redefine the very purpose of welfare. No longer is it officially defined as a safety net for those unable to find or perform work; now it is to be a social control mechanism ensuring that everyone has "social and economic participation".

Stripped of its rhetorical veneer, this "participation" amounts to forcing a greater proportion of the population into part-time, casual and otherwise low-paying work. Those unable to "participate" on the government's terms will be denied financial assistance and forced into dependency on families and charity.

Welfare redefined

To ensure it did its job, the McClure committee was given very defined terms of reference, which excluded the two key issues in improving the lot of those without work: job creation and the rate of financial support.

Even though there are 10 unemployed workers for every job vacancy, the committee was told not to focus on solving unemployment. Instead, its proposals were to be aimed at making people "less dependent" on welfare, particularly through restructuring the unemployed work force into an underemployed, or unpaid, work force.

This fundamental shift in the conception of welfare underlies all of the recommendations in the McClure report — even the more positive ones.

Thus the report proposes that expectations of participation — "mutual obligation" activities such as work for the dole — should be extended to all welfare recipients. Such activities are presently only compulsory for those under 35.

The report then recommends a restructure of all payment systems to a common "base" payment, a "needs-based" additional payment and a participation supplement, available to meet specific expenses associated with work.

The report also recommends that such a payment should be heavily tapered, allowing part-time workers, and possibly even some full-time workers, to receive the participation supplement as well.

The report further recommends making it easier to move on to and off payments as a worker moves into and out of casual work. The establishment of an income "bank" for those on unemployment benefits would provide more financial inducement to take short-term casual work.

It was presumably this broadening of income support that led Michael Raper, the president of the Australian Council of Social Service (ACOSS), to endorse the "broad directions" and "general thrust" of the report, while criticising it for "not going far enough" in "supporting" unemployed people and opposing the coercive nature of some recommendations. The Australian Catholic Social Welfare Commission made similar statements.

The point of reform

Their response shows that much of the welfare sector has missed the point of welfare reform. The "general thrust" has nothing to do with "supporting" unemployed people, and everything to do with creating a permanent underclass.

Even their criticisms are somewhat misdirected. Both ACOSS and the Catholic Social Welfare Commission criticised the government for "cost-cutting", for example — but the government's welfare reform agenda goes far beyond forcing people off social security in order to save welfare dollars.

Rather, like the welfare-to-work programs in the United States, "welfare reform" in this country is designed to facilitate the increased casualisation of the work force and to encourage (or force) more workers into the part-time work force, using a combination of the carrot of financial supplement and the stick of being cut off benefits.

Supplementing this underemployed reserve of labour will be a reserve of forced, no-cost labour through work for the dole programs and "voluntary" work.

While some of the report's recommendations, such as increased funding for child care and more funding for literacy programs, appear positive, they are a part of providing sufficient "carrot" to make the government's overall plan workable.

Welfare groups cannot simply support some measures and oppose others; they have to take a stance on the whole package of "welfare reform". By not doing so, they hand the initiative to the government.

Government enthusiasm

Not surprisingly, the government has responded enthusiastically to the overall direction of the McClure report. The ministerial statement explains, "Consistent with the McClure report, the government is seeking to develop a system that engages all people of working age in active social and economic participation".

The government has only promised to investigate the more strategic principles of the report — such as a unified payment system, a redesigned Centrelink structure, and more "early intervention" programs — but it has chosen to implement immediately all the directly coercive mechanisms.

These new coercive measures include: an extension of work for the dole to all unemployed under the age of 40; an extension of other compulsory "activities" (including part-time study, training and voluntary work) to all unemployed under 50; and compulsory interviews for parenting payments recipients once their youngest child turns six, and compulsory part-time "activities" once their youngest child turns 13.

Coercion will even extend to those on disability pensions. From now on, only government-picked doctors will be able to assess disability pension claimants, and "financial incentives" will be established to get pensioners to find part-time work. The govenrment has also committed itself to a long-term assessment of whether to bring in compulsory activities for disability pensioners.

In a clear attempt to build "consensus" for its conclusions, the McClure report also includes several recommendations on the responsibilities of business in the "new" environment of mutual obligations.

It makes no proposals for any job-creating limitations on business — such as a shorter working week with no loss of pay — but it does endorse the development of a "triple bottom line auditing process" whereby businesses would be assessed on their "social, environmental and economic" contribution to society.

Even this modest proposal, however, has drawn a quick and hostile response from the Australian Chamber of Commerce and Industry, whose chief executive Mark Paterson set the government straight in a media conference on December 15.

"Businesses will do whatever they can within their communities, but they are not welfare institutions, they don't have that talent and they shouldn't be expected to be welfare institutions", Paterson said.

The government has obviously taken note. The ministerial response to the mutual obligation section of the McClure report fails even to mention government or business responsibilities, while the social partnerships section on business/community co-operation is completely devoid of substance.

Even Patrick McClure, the chair of the Reference Group on Welfare Reform, who gave his name to the report, was forced to criticise the ministerial response for not offering enough to welfare recipients.

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