Australian Greens Dissenting Report

Introduction

The Australian Greens do not support the recommendation of the majority report that the Social Security Legislation Amendment (Community Development Program) Bill 2015 be passed.

1.1        As highlighted below, there are major flaws in the bill. During the hearing process the Department of Prime Minister and Cabinet were unable to provide satisfactory answers to many of the issues raised. It was the understanding of committee members that because of this the inquiry reporting date was to be extended. The reporting date was subsequently shortened, and then extended again by a few days. This process made it difficult to adequately explore the full implications of the measures in the bill. Areas of significant concern include:

• Significant gaps in the consultation process
• That despite the name of the policy, it differs significantly from the former Community Development Economic Program (CDEP), and is not a wages based policy as the CDEP was
• The discriminatory impact of the measure, which will disproportionately impact Aboriginal people in remote communities.
• The fundamental shift in the provision of social security in Australia
• Shifting decision making to private and non-government organisations
• Shifting responsibility for some areas of social security to the Minister for Indigenous Affairs:
  • This provides significant discretion to the Minister to make policy through legislative instrument, reducing the level of Parliamentary scrutiny
  • It may remove people in remote communities from the protection provided under social security legislation
• Significant implementation challenges, including the shift of responsibilities from the Department of Human Services to providers

Reporting date

1.2        Following an initial reporting date of the 29th of February, the Committee agreed to an extended reporting date to later in March, before subsequently reverting to the original date of the 29^th, and then extending to the current reporting date of 2 March 2016. This process made it difficult to consider the large number of significant concerns raised in evidence to the Committee. This dissenting report is just a short summary of the many fundamental problems with a poorly devised policy measure. The Australian Greens thank the wide range of organisations and witnesses who have helped the Committee by providing insightful analysis and evidence.

Consultation

1.3        The main committee reports notes that:

One of the themes in submissions and in evidence at the public hearing was frustration at the lack of consultation with communities and CDP providers prior to the introduction of the bill.[1]

1.4        The Australian Greens share this fundamental concern about the lack of consultation on such a significant proposed change.

1.5        Jobs Australia, in fact, said in its submission that:

... to date, there has been no formal consultation on any aspect of the CDP arrangements. To the extent that consultation has occurred, it has been limited to discussions with some individual communities and individual CDP providers. Of the 31 provider staff who dialled in to Jobs Australia's teleconference consultation on the Bill, none had been consulted on any aspect of this Bill before it was introduced in December, nor were they aware of any such consultation having taken place.[2]

1.6        Mr David Thompson, Chief Executive Officer of Jobs Australia, re-iterated that concern in evidence to the Committee:

I would assert that everything hangs on the details. The way things work and whether they are going to be a success or not hangs on the details.

I put forward the view that tabling the bill before Christmas with comments due over Christmas at the end of January with the initial consultation with providers about this bill and its implications happening two days ago does not amount to appropriate, effective or proper consultation ... the Prime Minister said in the parliament last week:

'It's our role as government to provide an environment that enables Indigenous leaders to develop local solutions'.

Not providers, leaders. It is time for governments to do things with Aboriginal people, not do things to them. The way this process is run does not fit that formula.[3]

1.7        Mr Morrison, Chief Executive Officer of the Northern Land Council, noted that:

...each of these policies, along with the design of the CDP bill, which we are here today discussing, has been developed without proper open consultation with the Aboriginal people.[4]

1.8        At the hearing for this bill departmental officials said:

Consultation with the providers has been by any judgement quite comprehensive, going back more than a year. There have been meetings and discussions at quite some level of detail with individual providers but there has also been collectively an opportunity for providers to gather on at least four occasions as a group to work with us, to workshop some of the issues we are discussing and work a way forward ... The first of the conferences with all the providers took place in March last year, and there have been four all up.[5]

1.9        The department's evidence makes it clear that this process related to policy measures, rather than to the detail of the bill itself, which was only introduced in early December 2015. Draft regulations are not yet available.

1.10      The department did provide a draft of a consultation paper which was proposed to be circulated to 'communities and providers', in relation to the drafting of the legislative instruments proposed in the Bill. A significant concern raised in multiple submissions and in relation to multiple aspects of the proposed changes was that much of the detail is not in the primary Bill. Instead, significant details of how this legislation will be implemented and will work in practice have been delegated to legislative instrument. Given this, it is deeply concerning that the consultation on the drafting of the legislative instruments has not yet begun. 

1.11      The Australian Council of Trade Unions said in evidence to the Committee:

In terms of consultation, as expressed by David Thompson, we are dismayed that the consultation has not been done at the front end. It is back-end consultation now that the legislation is already written and the program has already been imposed with providers and community members.[6]

Differences from CDEP

1.12      In his second reading speech, the Minister said that 'Community leaders and jobs providers often remind me of the positive elements of the previous Community Development Employment Project (CDEP) in remote Australia.'[7]

1.13      Evidence provided to the Committee from multiple sources makes it very clear that this program is not a revisiting of those earlier positive elements.

1.14      ACOSS said:

The CDP program is significantly different to the Community Development Employment Program (CDEP) for Aboriginal and Torres Strait Islander people that previously operated in remote areas. The former CDEP paid wages (and therefore complied with minimum wage requirements), was voluntary, provided people with an income support safety net payment if they did not meet community administered 'no show no pay' requirements to receive a wage payment, and was designed in consultation with local communities, building in flexibility to local needs.[8]

1.15      Similarly, Jobs Australia highlighted key differences between the CDEP and the current CDP changes proposed in this bill:

Under CDEP, participants were paid wages – not welfare, with the consequence that wages had to comply with minimum wage requirements. Under CDP, most participants perform Work for the Dole for 25 hours to receive a welfare payment, which equates to an hourly rate that is significantly less than the minimum wage.

CDEP was an 'opt-in' arrangement that operated as an alternative to welfare. People who opted in had the opportunity to work for real wages, and if they worked additional hours then they received additional pay. If, however, a person could not work or opted out of CDEP for some other reason, they could still access a safety-net payment through the welfare system. This meant that 'no-show, no-pay' rules (over which, local providers had significant discretion, and in many cases did not enforce strictly) never left vulnerable people completely without access to the safety-net. In contrast, no-show no-pay in CDP results in removal of the safety-net payment and can leave people without income support. This could put individuals (and any dependent family members) at risk.

CDEP was explicitly designed to empower communities. Communities, through local community councils, had to choose to implement a CDEP scheme and had the flexibility to tailor the rules that would apply in their community, as well as they types of projects that it would support. Under CDP (and with the measures in this Bill), the program is imposed by Government, the rules are determined by the Minister, and local projects are determined by the Minister, the Department and/or a contracted CDP provider. At best, communities may be consulted. These arrangements do not empower communities.[9]

1.16      Professor Jon Altman, an expert on CDEP, noted key differences in his evidence to the Committee:

...what really surprises me about these proposals—I quite transparently say I was in some discussions with Senator Scullion about the new proposals—is that this notion that people will get wages is missing, that they will be defined as employed and that they will have the opportunity to earn top-up. These are the fundamental things, alongside community control, that made CDEP so successful. When you actually look at what is being proposed, the ability to earn top-up is after 25 hours of working for the dole, not the 15 hours for award wages that you had under CDEP, so there is a 10-hour gap there. New poverty traps will be created, because some people will not do those 25 hours and then will earn extra money for the extra hours they will do, but there will be a trade-off. So it will not improve things.[10]

1.17      An appeal to the success of the CDEP program is fundamentally flawed, given the major differences which mean that the CDP, despite the similar name, is a very different approach.

Discrimination

1.18      One of the many significant concerns in relation to this proposed bill is the issue of discrimination. The Explanatory Memorandum says that:

...a determination will not be applied on the basis of racial, cultural, gender, religious, or political status of people residing in remote income support regions.[11]

1.19      However a much higher proportion of the population in remote regions are Aboriginal and Torres Strait Islander peoples. The Parliamentary Joint Committee on Human Rights said that:

By enabling the creation of a different system of obligations and penalty arrangements for remote job seekers, the bill engages and may limit the right to social security and the right to an adequate standard of living, and the right to equality and non-discrimination.[12]

1.20      Social Justice and Native Title Commissioner Mick Gooda said:

I am concerned the Healthy Welfare Card trial and the implementation of Work for the Dole in remote communities may give rise to indirect discrimination and have a negative impact on the ability of Aboriginal and Torres Strait Islander peoples to enjoy their rights, particularly the right to social security.[13]

1.21      He re-iterated those concerns in a submission to the inquiry, recommending that the Bill not be passed:

I reiterate my concerns about the mandatory application of Work for the Dole arrangements and submit that the Bill and Explanatory Memorandum, as currently drafted, do not provide sufficient protections of human rights. In view of these issues, the Commission considers that the Bill should not be passed in its present form.[14]

1.22      Jobs Australia also noted significant discrimination concerns in their submission:

Fundamentally, the Bill establishes a separate system for some welfare payments that are paid in remote Australia with arrangements that most likely discriminate against Indigenous people.

...while the text of the Bill does not explicitly target Indigenous people, there is a clear connection between a particular race and the areas in which the measures in the Bill will apply. The overwhelming majority of unemployed people in remote areas are Indigenous: of the 37,000 unemployed people in the regions that are currently considered remote, 31,000 (or 84%) are Indigenous ...

The real situation is that the new CDP contract imposes greater mutual obligation requirements on remote job seekers than currently apply to non-remote job seekers; more onerous obligations mean it is easier for remote job seekers to fail the requirements; that, in turn, increases the likelihood and frequency of financial penalties; and the measures in this Bill remove safeguards and protections that non-remote job seekers enjoy. Given that the vast majority of the target group are of one particular race, the arrangements are likely to be discriminatory.[15]

1.23      They also succinctly said one of the most obvious reasons for concern about the discriminatory impact for this proposed bill: '...if the legislation was not targeted to Indigenous people, then the Minister for Indigenous Affairs would not be the responsible Minister'.[16]

1.24      The Australian Council of Trade Unions also noted concerns about discrimination as a basis for their opposition to the proposed bill:

This year—it is quite ironic—Australia celebrates the 50th anniversary of when Aboriginal workers had to strike before their rights were recognised during the event that is now known as the Wave Hill walk-off. This event has been marked so poignantly across history by the finalisation of that strike being the footage of Gough Whitlam pouring sacred red dirt through Vincent Lingiari's hands. In 2016, 50 years since the Wave Hill walk-off, we cannot understand how it is conceivable that an Australian government would propose laws that once again allow Aboriginal people to be treated as an inferior class of workers in this country. Based on that, we cannot support the legislation.[17]

Fundamental change to social security

1.25      The bill makes fundamental changes to social security arrangements for remote areas, and provides the Minister with significant discretion through delegated legislation. This point was made in a number of submissions and in evidence to the Committee. The Australian Council of Social Services (ACOSS) said in their submission:

We consider that Bill would effectively allow the Minister to remove areas of remote Australia from those parts of social security legislation that govern the obligations and many of the rights of people receiving activity tested income support payments. It would reduce transparency and independent scrutiny of the effects of income supports arrangements on vulnerable people.[18]

1.26      The National Welfare Rights Network (NWRN) similarly noted that the bill:

...undermines basic protections in social security law such as appeal rights.

The Minister is given a general power to determine the regime of obligations and compliance applicable to recipients of activity tested payments, such as Newstart Allowance, who reside in designated remote regions by legislative instrument ...Simply put, the Minister has power to override or modify the Act. The Minister has not provided a justification for the width of this power.[19]

1.27      Jobs Australia made the point even more strongly in its submission:

The Bill delegates significant new regulation-making powers to the Minister for Indigenous Affairs and the Secretary of the Department of Prime Minister and Cabinet. Key aspects of the arrangements are simply not in the Bill ...

Legislative instruments are, of course, disallowable, but that is a lesser level of Parliamentary scrutiny than that which applies to legislation. The process takes time and the legislative instruments take effect from the time they are registered, which means they can be in place for months before they are considered by the Parliament.

Providing welfare payments to people in need of support is a core responsibility of the Federal Government, and to delegate this much authority over social security law to one Minister would be a fundamental abrogation of the Parliament's responsibility to hold the Government to account – a responsibility that is particularly important when individuals' human rights are affected.[20]

1.28      The Australian Greens agree that this change is not appropriate. It delegates decision making away from the Minister for Social Services and also abrogates the role of the Parliament in scrutinising changes to social security legislation.

Shift from the Department of Human Services to providers

1.29      A significant area of concern is the shift of responsibility and administration from the Government's Department of Human Services, to private service providers. Multiple submissions noted concerns on this front.

1.30      Professor Jon Altman said in his submission:

It is argued by the Minister that the CDP Bill will simplify compliance arrangements for remote income support recipients, but it is difficult to see how this will happen. For a start the new category 'remote income support recipient' will be created and treated differently from other recipients of welfare. And while monitoring will be devolved to community based providers in remote income support regions, they will also be charged with the burdensome task of panoptic micro-management of participation to the hour rather than to the day. So in the name of a simplified regulatory regime, providers will actually be entrusted with a more complicated regulatory framework. Each provider will be monitoring an average 500 job seekers not just for their participation for remote income support payments (25 hours by the hour per week for Newstart equivalent payments) but also for their movements between regions and for a complex set of acceptable reasons (like ceremony leave) for non-attendance.[21]

1.31      The NWRN similarly noted in relation to this change that:

Increasing the functioning and capacity of DHS, which is the government's specialist service delivery agency in remote areas is the answer, not handing over administrative functions to CDP providers, especially if the increased burden on those providers diverts them away from their core functions of providing valuable activities and helping job seekers into employment.[22]

Decisions made by services providers, not the Department of Human Services

1.32      The shift from DHS to providers will require service providers to make penalty and obligation decisions in relation to job seekers. Multiple submissions had concerns about this shift. ACOSS said:

The Bill would delegate administration of social security payments and penalties to local employment service providers (CDP providers), in effect privatising decisions about how obligations and penalties for individual people are applied by removing those decisions from the responsibility of the Department of Human Services. There are substantial concerns with this, including that independent local providers embedded in a small community, who often source staff from that community, would be making decisions about application of sanctions to people they are likely to know personally or be related to, which can cause a conflict of interest in the absence of a process to address this.[23]

1.33      Jobs Australia said:

Under the arrangements proposed in the Bill, such decisions would be made by staff in CDP providers, who are not free to apply their discretion and who have contractual incentives that push them to apply financial penalties. Individual circumstances, vulnerabilities and barriers are less likely to be appropriately taken into account.[24]

Appeals process

1.34      NWRN particularly highlighted concerns about the appeals process. NWRN said in their submission:

...the CDP Bill's transfer of power to the Minister is so wide as to undermine basic protections for income support recipients such as appeal rights. The explanatory memorandum, and the Department's submission, maintains that the CDP Bill preserves appeal rights. However, in the NWRN's reading of the bill, this is not so clear.

It is true that proposed s 125 makes decisions of departmental officers in relation to the new regime reviewable in the ordinary way, even if made under a legislative instrument. However proposed s 144(da) precludes AAT review of decisions by CDP providers. This is problematic, because the bill also gives the Minister a wide power to make determinations regarding the powers and functions of CDP providers, and review rights in relation to CDP provider decisions. On its face, this would authorise the Minister to transfer certain decisions (perhaps certain decisions about compliance) to CDP provider staff and, unless he determined otherwise, s 144(da) would preclude merits review of these decisions.

...Assurances in the Department's submission about the Minister's current intentions are lacking in detail and are no substitute for legislated appeal rights.[25]

1.35      In evidence to the Committee, Mr Gerard Thomas of the Sydney Welfare Rights Centre said in relation to the appeals process changes:

This measure is unprecedented, as far as I am concerned, and Welfare Rights does not know of any other precedent in this area.[26]

1.36      When asked about their responsibilities in handling appeals processes, a provider noted in evidence to the Committee that several questions had not been resolved:

It was raised in the conference this week, and we have also raised it in discussions with the department previously. The answer we have been given has not been clear, because it has not been drafted in a regulation yet. The query that we had was: would our staff members in making these decisions be protected in any way? What sort of safeguards are there? Again, it has not been written into any legislation. It would be in the regulation. But the department acknowledged that that was an issue and that one of the options—and, again, it is a hypothetical option—is that there would be an extension to provider staff to be treated similarly or the same as current DHS staff in the making of those decisions. They would see the same protections. Again, there is probably more devil in the detail, which would be in the regulations relating to that.[27]

1.37      Jobs Australia also highlighted concerns around the challenge in shifting responsibility for decisions to providers:

The people in the Department of Human Services who undertake review processes are very highly trained, and very highly trained in the proper documentation and evidencing of and reasons for the administrative decisions they make in relation to income support. That is going to have to be provided to the staff of CDP providers. If they have to front the AAT or the Federal Court they will need legal representation, and that will have to be underwritten by the government as well.[28]

1.38      In a paper provided to the Committee late on the 26th of February, PM&C outlined a process under which:

• Job seekers will be able to request a review by the provider
• Job seekers will be able to appeal to PM&C, which can review a decision under Part 4 of the Social Security (Administration) Act 1999.
• Job seekers can appeal PM&C's decision to the Administrative Appeals Tribunal, under Part 4A of the Social Security (Administration) Act 1999.
• Job seekers can appeal the AAT decision to a second review and subsequently to the courts, in line with current arrangements.

1.39      The paper says that provider employees would not be required to appear during the AAT process.

1.40      While the provision of this outline provides further detail, it also raises a number of concerns, such as PM&C's role as the appeal body, without any expertise in this area, and the potential for pressure to be applied on local providers over reviewing decisions. It is also concerning that this process is not clear from the legislation, as reflected in a number of submissions; it is unclear why this policy intent has not been reflected in the Bill.

Employment conditions

1.41      The Australian Council of Trade Unions, among others, also highlighted concerns over the workplace conditions of people undertaking Work for the Dole under the CDP. Ms Karalyn Keys said:

Our concerns centre on workers' rights, occupational health and safety, consultation and the possibility for discrimination under this program. In terms of workers rights, this Community Development Program is open to government agencies and now commercial businesses to take on or have access to Work-for-the-Dole workers. There are obviously a number of concerns with that. Regarding the increase to income thresholds, we think that there is an opportunity for increased earning capacity for workers. However, we would say that it establishes unequal and discriminatory workplace practices, especially in relation to the minimum wage and standard conditions of employment.

As outlined in our submission, this opens up the possibility that a worker could be engaged in a private for-profit company for 25 hours a week, working for well below the minimum wage, and then for any additional hours of extra work for that employer, at the same workplace, doing the same job, would be entitled to the minimum wage and minimum standards of employment...

We are also concerned about occupational health and safety implications. The CDP legislation specifically excludes these workers from federal workplace health and safety and compensation legislation. It is very vague at best as to how state and territory occupational health and safety, and workers compensation, legislation would apply to these workers. In a situation where someone has a very serious workplace injury or a death, there is no certainty that that worker or their family would be able to access the safety net that is provided for every other Australian worker.

Secondarily, there is no established clarity about who would be responsible for compliance with the occupational health and safety, and workers compensation, legislation. So is it the CDP provider or is it the host employer? There is no clarity around that so, clearly, we hold some concerns about how that would play out on the ground.[29]

Incentives for applying penalties

1.42      While many providers will face challenges in applying sanctions, there is a direct incentive in the payment scheme to impose sanctions. Peter Davidson from ACOSS said:

Basically, a provider has several options if a job seeker does not meet the requirements in attending an interview or attending Work for the Dole. One of them is to apply an immediate sanction, the other is to use other strategies to try to re-engage the person, like allowing them to make up time for missed activities at another time or rescheduling appointments.

The guidelines provide that the provider will be paid if they are able to re-engage the person within two weeks, so the provider could be in a scenario where they choose not to sanction the person for a range of reasons because they think there is the possibility of re-engaging them because they are concerned about the impact on the job seeker and they would prefer to re-engage them rather than sanction them, but if they are not successful in doing so, then they have invested a lot of time but they have received no payment for that work at the end. That puts all of the risk upon the provider in terms of the strategies that they use, whereas if they just used sanctions, then they would receive the payment for the amount of work they have done. We see that this bill is an incentive towards sanctioning rather than engaging in other strategies.[30]

The Community Investment Fund

1.43      In response to questions on notice, the department said that the detail of how the Community Investment Fund (CIF) was still being developed, but said:

The exact operational arrangements for the Community Investment Fund are yet to be determined ... it is proposed that funds that have been withheld as a result of penalties will be put back into communities, to assist local economic and community development initiatives and programmes ... The Community Investment Fund will be delivered through the Indigenous Advancement Strategy (IAS). IAS funding is administered by the Indigenous Affairs portfolio within the Department of the Prime Minister and Cabinet.

There are likely to be significant complexities in the process of returning funds to communities, but it is important to ensure this occurs. The Indigenous Advancement Strategy continues to be plagued by significant implementation problems, which have had devastating impacts on Aboriginal communities. For those reasons, it is concerning that appropriate consultation has not yet been undertaken, but is being postponed until the finalisation of the legislative instrument.[31]

Patronage

1.44      This shift in decision making to local providers has significant implications, and poses a real risk of wide-spread problems in the system. Several submissions noted that this would create challenges for providers who hire staff from their community, who will then be responsible for decision making in relation to other members of their communities.

1.45      Mr Peter Davidson of ACOSS stated in evidence to the Committee:

All of the incentives for providers and recipients of CDP services point to the entrenchment of a new system of patronage in remote communities, where people's survival depends increasingly on their performance of activities for a service provider. Even if they secure part-time employment, their dependency on the provider continues. Incentives are weak for individuals and providers to assist people to move towards financial independence and for communities to take hold of their own futures. There is a risk that this will entrench a system of patronage that is similar to the mission arrangements that existed in many of those communities decades ago.[32]

1.46      Jobs Australia noted in their submission:

A further complication is the fact that providers often source their staff from the local community. That means that the people charged with responsibility for making decisions about benefit payments will also have relationships with people in the community – they will be responsible for deciding whether to apply sanctions to people who are their neighbours, friends, and family members. In situations where the job seeker is known to the staff member, it is almost impossible for decisions to be made with the same kind of impartial assessment that would be undertaken by a stranger in DHS.[33]

Concerns about the safety of provider employees

1.47      An additional concern was raised in relation to the protection of the employees of service providers. One service provider, the Tiwi Islands Training and Employment Board, said in their submission:

Currently, our staff report non-participation to the Department of Human Services (DHS), and it is DHS staff who make the decision about any reduction in benefit payments. This means that when angry people approach our staff and ask why their benefits have been reduced, we can refer them to DHS. DHS has systems in place to address staff safety and, in most cases, manages these conversations by phone. If our staff are to be entirely responsible for decisions about people's benefits, then it's inevitable that community members who are aggrieved at such a decision will confront our staff. We might be able to increase security at our offices, but that has a substantial cost and still leaves staff exposed outside of work hours or away from secure premises. It will make it harder for us to attract and retain local Indigenous people to work in delivering the program.[34]

Conclusion

1.48      Throughout the Committee process, clear evidence was provided through submissions and in the hearing that the proposed framework will fail to support Aboriginal people in remote communities. The Australian Greens oppose the measures in this bill, which are fundamentally flawed, will involve major implementation challenges, and will create further significant problems.

The Australian Greens recommend that the Social Security Legislation Amendment (Community Development Program) Bill 2015 not be passed.

1.49      However there is an urgent need to provide appropriate support in remote communities. We agree with the Government to the extent that the current approach to employment support in remote communities is failing and needs reform.

The Australian Greens recommend that the Government adopt an approach of consulting communities directly to develop policy approaches which are community initiated and have strong community involvement.

1.50      Some areas worth examining further include:

• The Indigenous Ranger program, which provides significant employment benefits, and strong environmental outcomes.
• The Aboriginal Peak Organisations Northern Territory (APONT) has proposed a model, which could be trialled in the Northern Territory, after appropriate consultation.[35]  We urge the Government to review this proposal and work with community on a program that will not disadvantage Aboriginal and Torres Strait Islander peoples.

Senator Rachel Siewert

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