By Richard Southall
On May 1, the structure of employment services was transformed as provision was opened up to private companies. The Howard government claims that this partial privatisation will result in better services because the unemployed will be able to choose between competing providers. But how close to reality is this?
The first experience the unemployed are likely to have with the new system is being required to complete a JSCI (job seeker classification index). This survey will be used to divide all unemployed into three categories: "job matching", "job search assistance" and "intensive assistance".
Though the categorisation is more complicated than this, those unemployed for less than six months are likely to be placed in the job matching category, unemployed for over six months in the job seekers assistance category and more than 12 months in intensive assistance.
Those in the job matching category will be able to choose five different service providers, who are then obliged to give them information on available, suitable jobs.
Those placed in job seekers assistance must select one service provider and sign an agreement (just like the old Newstart agreements) with the provider. They will be contracted to stay with that provider for 12 months. They will also have to undergo three weeks of a "job searching course" similar to the old "job clubs".
Those in intensive assistance will also have to choose one provider and sign an agreement for 12 months. They will be "case managed" similarly to the old case management done by the CES.
All providers are funded the same way. First, they receive a payment for taking on a client. Then they receive a payment when the client has been in work for 13 weeks, and a final payment at 26 weeks.
The payment is determined by the category of the client. For an intensive assistance client, the provider can earn $10,000. These jobs need be only 15 hours per week, and there need not be any guarantee of a permanent job.
Since unemployed people have a choice of which provider they will be contracted to, they should remember that some are non-profit organisations, some are private companies, and Employment National is owned by the government.
You also need to be aware of the kinds of questions to ask providers before selecting one: what their complaints procedures are, what services and resources they provide for people in your category and with your needs, what percentage of their clients have found work and what actions will cause them to report you to Centrelink as uncooperative.
If it is decided that you are "uncooperative", Centrelink may decide that you are in breach. Penalties for an administrative breach are 13 weeks of 16% benefit reduction or two weeks with no payment. Administrative breaches include not attending a Centrelink interview, not returning a job seeker diary when asked to do so, not contacting Centrelink when asked to do so and not notifying of a change in circumstances.
Activity test breaches are punished by 18% benefit reduction for 26 weeks for the first offence, 24% for 26 weeks for the second offence and eight weeks with no payment for the third if the offences are within two years of each other.
These breaches include not actively looking for suitable work, leaving a job voluntarily, losing a job through misconduct, refusing a job offer or missing an interview, not declaring correct income, leaving a labour market program and failure to enter a Newstart agreement.
This new system will make the lives of the unemployed even harder. Services available to the unemployed will be greatly reduced; because all employment service providers have to compete and many have to run at a profit, they will offer very little.
Also, the idea that unemployed people now have a choice of providers is erroneous. Many regions have only one provider nearby, and in some cases this is a private company. Furthermore, unemployed people have very limited access to the information they need to make an informed choice of providers. If they discover that their provider is not to their liking, they are stuck with them for 12 months.
[Richard Southall is a member of the Warrawong Unemployed Group.]