RUDD'S HARSH LINE ON WELFARE

Rudd continues harsh line on welfare

Stephanie Peatling, smh

November 18, 2008

AS MANY as 60 people a day are having welfare payments withdrawn for eight weeks despite the Federal Government's promise to take a more compassionate approach to job seekers and use the penalty only as a last resort.

The so-called three strikes penalty was introduced by the previous government and was used if people receiving welfare payments failed three times to meet the conditions of their benefits, such as attending a job interview or meeting a Centrelink officer.

Welfare groups are losing faith with the Government's approach to people on welfare payments and said its proposed new system was too complex and did not have enough safeguards.

"The risks with what the Government is proposing are too great, the safeguards too few, the penalties too few and the system far too complex," the president of the National Welfare Rights Network, Kate Beaumont, said.

The Government had promised to limit the occasions on which people's welfare payments were suspended for eight weeks.

Instead it wants to rely on a "no show, no pay" system where people would be docked the equivalent of one day's payment if they failed to meet requirements such as reporting to Centrelink or applying for jobs.

It believes this will be a better way of dealing with the long-term unemployed who are making up an increasing percentage of people without jobs.

The Government wants the new system to be in place from July 1 and is holding a hasty parliamentary inquiry into the proposed changes.

There is one day of public hearings and the Government hopes the legislation will be passed before the end of the year.

In its submission to the inquiry the Department of Education, Employment and Workplace Relations says the eight-week suspension system has not been effective.

Instead of encouraging people to find jobs it had placed them at a greater risk of homelessness and social disconnection, the department said.

"Many submissions argued that the 'penalise first' approach taken in recent years may result in costs to the community in other ways, through imposts on the health, housing and justice systems and by placing additional pressure on non-government welfare organisations to provide support."

Despite this, the numbers of people having their payments stopped is continuing.

The department said although the number had been lower since the election of the Government a year ago the monthly rate was "now significantly higher than it was when the current system was introduced".

At the moment the yearly rate is about 22,000 people or 60 people a day.

While people have their payments suspended they are eligible to receive financial case management. This means Centrelink will pay necessary expenses on their behalf such as rent and medication.

But under the proposed "no show, no pay" system financial case management would not be offered.

"There is no legislated cap on the number of 'no show, no pay' penalties and jobseekers may face an immediate loss of payment," Ms Beaumont said. They also risked bank default fees.