The Albanese government has promised to undertake “once-in-a-generation” reforms of the government’s employment services system, which could affect the roughly one million Australians who access unemployment payments including JobSeeker.
Announcing the changes at the National Press Club on Wednesday, Employment and Workplace Relations Minister Amanda Rishworth said the current system was “ill-equipped to respond” to unemployed people’s needs and is:
letting too many people in the caseload fall through the cracks, and failing to support them into a job.
The goal of the changes is to move from a “one-size-fits-all” approach of helping people find work, to giving different levels of support depending on what people need. However, there’s no clear start date for these changes yet.
The government’s plan to make improvements to a punitive system is welcome. Yet only three years ago, it was talking about even more ambitious changes.
Here’s what’s just been promised – and where the government still has the opportunity to do more.
What’s going to change?
The federal government says it will overhaul the current “one‑size‑fits‑all” system of Workforce Australia. This government service helps people find and keep secure work and manages the “mutual obligation” requirements for receiving certain payments.
For example, an individual receiving JobSeeker payments may have to apply for a certain number of jobs, take part in training and attend job interviews.
Under the proposed new system, job seekers will be sorted into three groups, known as “service streams”. These will offer different levels of support based on differing needs, with different mutual obligations.
Service stream one will be designed for people who are seen as ready to work and just need help to find a job. This would offer an improved digital service with individualised online tools and brief contact-centre support. The government says it will invest A$205 million in building this new service.
Service stream two will be for people who need more active help. That could mean coaching, confidence building, more direct support from a provider and goals tied more clearly to actual jobs in local labour markets.
Service stream three is for long-term unemployed people, or those with complex needs, who have been poorly served by the current system. This could include people who may need longer-term help, work experience, social enterprise or volunteering opportunities. A total of $52 million of funding has been earmarked in the budget for rolling out, testing and refining this more intensive service.
The government also announced it would put $27 million towards developing a revised assessment process, alongside the introduction of tailored employment goal plans in place of standardised job plans.
How we got here
This week’s announcement marks the long-anticipated outcome of consultations that began more than three years ago, with a parliamentary review of Workforce Australia led by Labor MP Julian Hill.
Workforce Australia was introduced in 2022 and designed by the Morrison government to replace the earlier jobactive service system. The 2023 Hill review argued there were many problems with the new system.
These included an “excessive” focus on mutual obligations, often forcing job seekers to perform unnecessary tasks, or apply for jobs they weren’t qualified for.
Others included the alienation of employers, such as by not pairing suitable candidates with jobs available, as well as a high turnover of employment service providers due to a “Hunger Games style contracting model”.
The review’s final report made 75 recommendations to comprehensively rebuild the system.
Lukas Coch/AAP
Problems yet to be addressed
The federal government formally responded to the review in 2024, saying it agreed reform was necessary. But it also said given such a complex system this “will take time to get right”.
This week’s announcement still leaves many of the Hill review’s recommendations unaddressed.
The single biggest gap between what the Hill review found was needed just three years ago, versus what’s been done now, is on mutual obligations.
Under the new system, mutual obligations will be different for each stream.
For those closest to work in stream one, there’ll be a simpler focus on job searches and other vocational activities. For stream two, a flexible focus on training and other support, connected to a participant’s employment goals. And obligations in stream three will focus on “meaningful engagement and building someone’s readiness to work”.
The Hill review did not recommend the complete abolition of mutual obligations, rather a move to a “shared accountability” framework. This would include giving frontline workers more discretion to “educate and counsel” people when they failed to meet their obligations a limited number of times, rather than automatically withhold payments.
The language of “meaningful engagement” is better than blunt punishment. But it still makes little sense to threaten the income of people already living below the poverty line to make them engage with services when they are already desperate for work.
Other recommendations that haven’t yet been acted on include:
- creating a new public entity, called Employment Services Australia, to help run employment services
- establishing a network of regional hubs
- establishing an independent Employment Services Quality Commission.
Further changes possible
The government says there will be further consultation to further shape some of the design elements of the new service.
The main takeaway is these proposed reforms do not live up to the aspirations of the Albanese government’s own Hill review.
The government has tried to sell this as “once-in-a-generation” reform. For that to be true, there’s still much work to be done.
