Opinion & Commentary
Back to work in Brown's Britain
It is ironic that the Rudd Government is considering weakening the federal Job Network of employment agencies and its background ethos of meeting conditions for welfare, just as Britain is belatedly starting to copy it. There, as in Australia, unemployment is at historic lows, yet the total number of working-age people on benefits keeps rising.
This has prompted the Brown Government to issue a discussion paper that seeks to raise workforce participation to 80 per cent (compared with the mid-60s in Australia) by getting people off welfare and into jobs. The paper is being hailed as the biggest shake-up of welfare policy for decades.
The paradox of falling unemployment and rising welfare dependency is explained by the steady flow of claimants from the dole into other welfare payments, particularly incapacity benefit (the equivalent of Australia's disability support pension). The Government wants to stem this flow by treating all benefits as temporary and creating an expectation that everyone except full-time carers and the severely disabled shouldwork.
Three-quarters of a million adults claim unemployment benefits in Britain. This figure doubles if we add jobless single parents on income support. But even this combined number is dwarfed by the 2.6 million working-age adults who claim incapacity benefit. The key challenge is to prick this disability bubble.
When Tony Blair was first elected in 1997, he appointed Frank Field as minister for welfare reform and told him to ``think the unthinkable''. But when Field thought the unthinkable he was sacked, and television images of people in wheelchairs demonstrating outside parliament against incapacity benefit reforms drove the issue off the agenda for a decade.
Now a new minister, James Purnell, has put it back again and the omens look good. His proposals have met with widespread support across the parties and in the media. Much of what is being proposed will already be familiar to Australians, for Britain is trailing in Australia's wake on much of the welfare reform agenda.
Single parents whose children are over 12, for example, will have to look for work, and this requirement will gradually be extended to include those with children aged seven and above. But this only brings Britain into line with the rest of the Western world. Australia introduced similar reforms back in 2006 (although the Rudd Government shows disturbing signs of backsliding).
There are also plans to require the long-term unemployed to work for their dole, and non-government agencies will be contracted to find them jobs and will be paid by results. This, too, will be familiar to Australians, for the privatised Job Network has been providing services for unemployed people (not just the long-term unemployed) for more than 10 years.
But the most important reform idea finds no strong echo in Australia. This is the attempt to reduce disability numbers by reassessing all existing claimants and replacing the incapacity benefit with a new employment and support allowance geared to returning people towork.
The Howard government tightened the criteria for the disability support pension, but this was not made retrospective, and there is no mechanism in Australia for getting people off the pension once they are on it. In Britain, however, all claimants -- existing as well as new ones -- will now be subjected to a work capability assessment before being allowed on to the employment and support allowance.
Once accepted, they will be monitored, and most will be expected to return to work later. If you suffer depression, you will get counselling. If you have a bad back, you will be given pain-management training. The focus will be on what you can do, not what you can't. There are, however, two nagging concerns.
One, voiced by Field, is that there will still be an incentive to get yourself classified as disabled. The new employment and support allowance will be sub-divided into a work category and a support category. Only the former will have to go through a back-to-work program, while the latter (consisting of more severely disabled people) will be given more generous payments. There is a clear danger here that the new system will end up with the same definitional problems as the old one.
The other concern is what sorts of jobs people leaving welfare may do. In Britain, as in Australia, the underlying cause of the expansion in disability benefits has been the decline in the demand for unskilled labour. Getting people off disability benefits will be hard enough, but finding jobs for them is going to be even harder. It seems the Government hasn't begun to think about that.
Professor Peter Saunders was formerly social research director at the Centre for Independent Studies.
