RAY BRICKNELL. Solving the Morrison government’s Newstart problem

Having ditched the Holy Grail of a budget surplus, admitting in the process – in deeds if not in words – that unemployment is a bigger problem than government debt, the Morrison government now faces a serious quandary.

How can it “snap back” the JobSeeker allowance to the $40 per day Newstart allowance in the face of enormous public pressure and massive, government decreed unemployment, without a severe loss of political capital?

Easy. Just change the name from Newstart to Basic Welfare Support (BWS) and introduce a new, comprehensive skills development programme to be run through Community Support and Development Units (CSDU). Unemployed people who voluntarily enter, and fully engage with, the CSDU programme would then continue to receive the JobSeeker payment. Those who fail to both join and fully engage would automatically revert to the lower rate BWS payment. The CSDU programme funding would come from the same budget allocation as JobSeeker and JobKeeper. Initial funding could equal four times the current cost of Newstart. JobKeeper will still end on 1 October 2020.

There are two parts to the problems of unemployment and under-employment. The first is a shortage of people with the skills required to fill the available jobs. The second, which existed before the pandemic but will be much worse post-pandemic, is simply a shortage of demand driven jobs. Comprehensive skills development will solve the first problem; government assisted creation of new industries and jobs will inescapably be needed to solve the second. In both cases, upskilling or re-skilling will be required, and only government is in a position to provide these. A Singapore style Upskilling Programme could help create entry level jobs.

So how does the CSDU programme work for those incentivized to join it?

The Plan:

  1. Pull together the resources of all three levels of government to develop a series of Community Support and Development Units through which long-term (greater than three months) unemployed people are offered employment on a purely voluntary basis by the federal government at the JobSeeker rate, subject to a strict set of employment conditions. Let’s call these people Trainees for the sake of discussion.
  2. Choose some good Centrelink Case Managers, to be designated Supervising Case Managers or similar, to train and manage teams of 5 or 10 newly recruited Training Coordinators, these recruits coming exclusively from the pool of long term unemployed aged over 50. The Training Coordinators should also earn at the JobSeeker rate, subject to satisfactory performance.
  3. Assign 5 or 10 Trainees to each Training Coordinator, whose role it would be to work one-on-one with each Trainee in turn to jointly design individualized training programmes for them, in much the same way as support and assistance programmes are now designed through consultation with participants in the NDIS programme. The individual training programmes should be subject to the approval of the Supervising Case Manager and could include, but should not be limited to (in no particular order):
  • Personal development – general
  • Reading and writing English, including grammar
  • Catch-up and general mathematics; STEM subjects
  • Woodwork, Metalwork, Use and maintenance of tools
  • Typing, and Computer use and management
  • Computer coding
  • Resumé writing and job application techniques
  • Money management and budgeting
  • Respectful relationships between and within genders; Manners and etiquette
  • Positive parenting
  • Physical fitness, Healthcare and Diet
  • Games and sports, with emphasis on team games
  • Hygiene – personal and general; Personal care and grooming
  • Speech training and voice projection for those with poor speaking ability
  • The list of possibilities is actually endless, and will largely be governed by what is available in the nearby area, and when, at such places as TAFE colleges, schools, universities, PCYG gyms, libraries, men’s sheds, commercial training organisations, and such like.

HECS-type funding should be used to pay for all training courses, and care needs to be taken to avoid a re-run of the scam whereby private training providers used free I-Pads to induce unemployed people to sign up for courses they were never likely to complete or benefit from. Only courses approved by the Training Coordinator may be undertaken. The programme will need close surveillance and assessment against KPIs by the Auditor-General.

In order to remain employed and in the programme, the Trainees would be obliged to not only attend specified classes and activities, whether chosen by mutual agreement or prescribed by the Training Coordinator, but also to demonstrate engagement. Tough love will be required.

Failure to attend or engage in any part of any day’s programme would, at the discretion of the Training Coordinator, result in pay for that day reverting to the Newstart Allowance. Persistent failure to attend or engage (say, three ‘strikes’) would result in removal from the programme and reversion to BWS (Newstart). The personalized programmes should occupy five full days a week, or close thereto, to develop self-discipline and a work ethic. Any free time should ideally be devoted to team sports like volleyball or gym games or similar – or even board games with peers. (Not computer games.)

Training Coordinators should be required to spend any free time attending and participating in, so far as they are physically able, the various activities being undertaken by their Trainees. The aim would be to build rapport and trust between the Training Coordinators and Trainees, and incidentally to improve the life skills of the Training Coordinators as well as the Trainees.

Unannounced spot checks by Training Coordinators and the Auditor-General should be frequent and ongoing.

Training Coordinators and Supervising Case Managers should work together to gradually identify the strengths and weaknesses of each Trainee, and to act as mentors, with a view to maximizing the long-term value of each individual’s personalized training programme. Where practicable, training should culminate in the completion of formal courses and qualifications, taking each Trainee as far up the skills ladder as their personalities and capabilities permitted.

There should be no time limit on participation in the programme, with each individual’s programme hopefully culminating in perhaps an internship and then employment. Training should generally be focused on preparation for employment in a particular field of endeavour.

The health and welfare of each Trainee should be progressively reviewed and improved by appropriate treatment (e.g. dental care, professional counselling) throughout the process. Each Community Support and Development Unit should be given funded access to whatever health and welfare services its clients need, including travel and accommodation expenses to allow access to specialist services not locally available.

Companies and organisations needing short term staff should be able to hire from these units at the minimum wage. Government funded job creation initiatives, using such things as internships in R&D and start-up company incubation programmes, should form part of this programme.

Fundamental to the success of the proposed Community Support and Development Unit (CSDU) programme will be the provision to it of a full complement of professional resources capable of dealing with the root causes of inability and/or unwillingness to join the paid workforce. Specialist skills to be provided to the CSD units must include, but not be limited to: medical doctors and specialists, psychologists, diagnosticians, therapeutic and rehabilitation specialists, teachers and trainers – every type of specialist skill necessary to absolutely maximise the probability that, after a reasonable period of time, everyone who is physically and mentally capable of doing any form of useful work is equipped to do so, to the maximum extent practicable. The aim should be to reduce the acceptable level of unemployment to 2% of the working age population.

Hopefully, the end result in many cases will be an overcoming of much of the inherited disadvantage which often causes the long-term unemployment prevalent in pockets of high unemployment. The payback for the government should be less crime, less imprisonment, less drug problems, lower health costs, and a gradual upskilling of the unemployed in skill areas where job opportunities exist or can be created.

In designing the programme it will be important to avoid creating a situation in which, at the end of the training, the young people who then have good personal and job skills and are ready to take their place in the workforce emerge to find there are still no jobs available. If that were the case the let-down for many could be devastating, all the effort for nothing, and their newly found self-esteem gone. So the intake to the programme should perhaps be limited to the probable availability of suitable jobs on completion? Positions currently being filled using Temporary Work visas, especially in aged care and the like, could be a suitable place to find initial target vacancies.

Trainees would need to be prepared for the possibility that there may not be a conventional job available for them after the training, but should also be encouraged and assisted to seek out job opportunities. Training Coordinators should develop networks of employers, including NFPs, prepared to offer work experience. Of course, one potential employment outcome would be for Trainees to become Assistant Training Coordinators, and then Training Coordinators. Ideally, no one should leave the programme except to move into full time paid or volunteer employment, with pay to continue at JobSeeker level for those working as volunteers for Not-for-Profits.

Naturally, the Training Coordinators will themselves also be incidentally upskilled, thereby opening up supervisory and management jobs to them within and outside the Community Support and Development Units network.

Clearly, the public service will be able to flesh-out and improve on the above outline.

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Ray Bricknell is a retired project management consultant who now tutors classes in Current Affairs and Macroeconomics at the University of the Third Age, Brisbane.

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12 Responses to RAY BRICKNELL. Solving the Morrison government’s Newstart problem

  1. Avatar Ray Bricknell says:

    John, at 64 you have a huge number of life skills and the maturity to be able to help younger people to benefit from the available personal development and skills training – so you would be an obvious candidate to become a Training Coordinator.

  2. Avatar David Brown says:

    sadly the current LNP would use your plan as yet another mechanism for transferring tax money to private company mates

    as pointed out by Kieng Choong above, just like Newstart, the LNP’s bastardised approach would not motivate the (private for profit) companies to actually attempt to solve the demand for jobs

  3. Avatar Kien Choong says:

    Hi, I’m not sure I understand what is being proposed here. The article observes there are two problems: (i) skill mismatch, and (ii) inadequate demand. It then proposes social security support conditional on reskilling. How does this address inadequate demand?

    As I understand it, inadequate demand is a genuine and substantial problem. No amount of reskilling is going to fix this. Have I misread the article?

    In any event, I look forward to reading a follow up article to explain how we would address inadequate demand.

    • Avatar Ray Bricknell says:

      Sorry, it was not my intention to address inadequate demand in this post, which was already longer than the preferred 1,000 words. I do have some thoughts on demand creation. Ray Bricknell.

  4. Avatar Tony King says:

    There seems to be an underlying assumption in this proposal that people are unemployed due to some defect in their education, personality, or skillset. No doubt that’s true for some, but I’d be really interested to know what percentage of those currently on JobSeeker (or likely to come onto JobSeeker when JobKeeper ends) fit this characterisation.

    • Avatar Ray Bricknell says:

      Yes, this proposal is primarily focussed on addressing inherited disadvantage, and reducing the mismatch between jobs available and those unemployed.

  5. Avatar Jackie Deacon says:

    Best and most comprehensive suggestion Ive seen. This seems to cover most bases.
    Many existing Newstarters are older, and some have disabilities that make it near impossible for them to find a job. This suggestion would see them assessed (something not done now) and given a chance, or a transfer to a more suitable payment. But can Morrison government pull the ideological blinkers off ?

    • Avatar Ray Bricknell says:

      My hope is that it might catch the eye of someone on the PM’s staff – hence the suggested ‘face saver’ of keeping Newstart as a baseline welfare payment, at the current rate, for those who cannot be motivated to engage with the personal development programme.

  6. Avatar Evan Hadkins says:

    That’s a great proposal.

  7. Avatar John Forrest says:

    Thanks Ray, at 64 I really need to sign up to a skills development programme for an entry level job.

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