Budget 2011 — big stick, little carrot

May 20, 2011
Issue 
New activity testing for people applying for the Disability Support Pension has been introduced to save social security expendit

Despite some targeted increases in funding in the area of health and disability, the Labor government’s 2011 budget leaves Australians worse off.

The increased funding for mental health has been widely welcomed and is a result of a long, concerted public campaign. Over five years, $2.2 billion in mental health spending was identified with a focus on early intervention programs, as well as social and employment participation strategies.

Multicultural organisations, however, have criticised the absence of funding for the multicultural community.

Multicultural Mental Health Australia said: “Some data has indicated that people from culturally and linguistically diverse communities have higher rates of involuntary admissions, longer periods of hospitalisation, and are more likely to present for treatment at the acute or crisis stage when compared to the mainstream community.

“Therefore, greater support is required to implement comprehensive strategies which specifically target these communities, preferably in a range of languages and methods, in order to reduce the burden placed on our health system as well as on our communities.”

There was no budget allocation to address this situation.

Overshadowed by the funding announcements is a planned inquiry to look at incorporating people with mental illness into the Supported Wage System (SWS).

The SWS is now applied to some people with disability and allows for reduced wages for workers with disability.

If for instance such workers “capacity” is assessed as “reduced”, their wage can equally be “adjusted” to the respective reduction in capacity. No minimum wage applies.



New activity testing for people applying for the Disability Support Pension (DSP) has been introduced to save social security expenditure. The punitive approach has no record of improving workforce participation or undermining stigma and prejudice and is widely criticised by the disability community.

New DSP applicants, apart from those with severe disability, will have to provide evidence that they are unable to work independently. Applicants will be required to work with a Disability Employment Service for up to 18 months. During this time they will receive the Newstart Allowance with the aim of securing a job.

This measure is expected to save the government $49.7 million over four years.

The Australian Federation of Disability Organisations (AFDO) has expressed concerns that people with a genuine need for DSP will not get it. They say the failure to secure a job should not be the criteria for receiving the DSP.

AFDO points out that people with disability have extra disability-related costs to meet, such as transport, equipment and aids. The Newstart Allowance and other allowances are $128 a week less than the DSP and it is not considered how such costs will be met.

New participation requirements and suspension of payments are in effect putting people with disability at risk and may have a range of unintended, though to be expected, negative health and economic outcomes.

One welcome measure included in the budget is the relaxation of the number of hours a person can work part-time before DSP is fully withdrawn, from 15 to 30 hours a week. It is estimated that this will help 4000 people on DSP to enter work and a further 3900 people already on DSP to work extra hours.

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