03 January 2014
Jobs not Newstart the key to disability pension reform
The big challenge for disability reform is to increase workforce participation
The Abbott government's proposed overhaul of the Disability Support Pension has caused significant anxiety for many who live with a disability and at the worst time of the year.
Once again, media reports suggests that we have a crisis, with too many people on the payment who should not be there, likely because they are malingerers or worse, fraudsters.
The facts tell a very different truth. There are a number of drivers of the total number of people on the disability pension, but none have anything to do with people being either bludgers or cheats.
As government reports confirm, the rise in those accessing the disability pension over the past decade is due to a combination of our ageing and increasing population, the rise in the age pension eligibility age for women, improved survival rates following traumatic health conditions, better disclosure of people who have a mental illness, the closing off of other payments such as the widows' allowance, and crucially, sadly, a significant reduction in the employment rates of people with disability partly due to structural changes in the labour market.
In the last two years, however, we have seen a reduction in the rate of successful new grants of disability pension cases due to further tightening of the eligibility criteria. Only those who have had medical confirmation that they are unable to perform a minimum of 15 hours of work per week for at least two years can now be considered. Due in part to these measures there has been a 1.2 per cent decline in the number of people accessing the disability pension.
As Paralympics gold medallist Kurt Fearnley laid out in his Australia Day speech earlier this year, the proportion of unemployed people with a disability living in or near poverty is more than double the OECD average of 22 per cent.
Australia ranks 21st out of 29 OECD countries in employment participation rates for those with a disability. Worse, we rank 27th out of 27 in terms of the correlation between disability and poverty.
Yet, in flagging this review, Minister for Social Services Kevin Andrews has failed to rule out moving disability pension recipients across to the inadequate Newstart unemployment allowance.
Such a change would reduce income by $155 per week, placing even greater pressure on people who are already facing multiple barriers to getting a job.
The focus of reform should not be on how to move people off the disability pension. Instead, it should be on how to get people into ongoing employment while ensuring those unable to get paid work can lead a decent dignified life with adequate income support. This is our social contract.
Both government and private enterprise can and should do more to increase employment opportunities for Australians with a disability. In the Australian Public Service for example, employment of people with disabilities has more than halved since the early '90s from 6 to just 2.9 per cent.
The latest State of the Service report showed that the public service is losing three times as many people with disabilities as it is hiring, with numbers in the service hitting a 20-year low.
The Abbott government cannot afford to repeat the mistakes made by former governments of both political persuasions, where welfare reform involved little more than shifting vulnerable people on to lower payments, including people with disability and single parents, while failing to tackle the barriers to improving employment outcomes. This is one of the major reasons why poverty is on the rise.
The Abbott government should put politics aside and look at expanding the former government's disability employment reforms. This includes the adoption of a policy approach that prioritises the long-term economic benefits associated with increasing workforce participation among people with a disability who are able to work over any potential short-term desire to reduce expenditure by shifting vulnerable people on to significantly lower welfare payments.
Rarely in public policy do occasions exist where both the economic and moral imperatives neatly align. This is such an occasion.
People with disabilities desperately want to be independent and to benefit from the dignity of paid work. The country needs more people in the workforce. The big reform we need in disability support is to provide these job opportunities. The last thing we need is to plunge people further into poverty by cutting their payments.