Foreword

The people we met, spoke with, and learned from over many months were consistently inspiring. Parents who loved and hated ParentsNext and everything in between, and the workers who choose their often difficult and usually low-paid jobs to support parents. We thank them for their time and, at times raw, honesty. Those conversations directly inform our report and will stay with us as we continue our work.

At times over many months, it felt like we would never find a way forward, as ParentsNext is polarising. More so than any other aspect of employment services that the Committee has grappled with so far. ParentsNext has been the subject of considerable controversy. Indeed, while our inquiry is a first principles review, there have been two parliamentary inquiries since the national rollout of the program in 2018.

Many people love ParentsNext, think it’s the best and most flexible program, and want to keep it as is. Numerous parents we met with explained that ParentsNext has helped them to build confidence, connect with employers, and find paid work. Yetmany others think it’s something close to evil and must be scrapped, describing the compliance process as re-traumatising and akin to coercive control. With such strongly and genuinely held views it’s proven uncommon for people to see the perspectives of others with different views or engage in the middle.

The Committee’s conclusions are nuanced, and its recommendations comprehensive. This report is genuinely and thoughtfully made, faithful to the evidence and the result of deep shared reflection by all members of the Committee.

The Australian Government has a responsibility to support and empower parents to achieve full social and economic participation. This is not merely a moral imperative, but an economic priority. ParentsNext grew out of earlier efforts to help young teenage parents, and then highly disadvantaged single mums with positive net outcomes. The Committee’s conclusion is that the continuation of a ‘program’ (we say pre-vocational service) to support vulnerable parents is essential.

ParentsNext, however, is now locked into a punitive frame and does too much harm for the good it also does. Unfortunately, the positive experiences were overshadowed by evidence of harms caused by onerous participation requirements and a harsh compliance regime. The Committee also heard that the program has an undue focus on paid employment, which may not be appropriate for many parents who have made the reasonable choice to focus on caring for their young children.

The Committee is clear in our view that parents (usually though not always mothers) have a right to choose to actively parent their babies and very young children, and this right should not just be available to wealthy parents. Caring for young children is work which used to be valued in its own right and a mandatory focus on preparing parents of very young children for future employment is a very patriarchal view of caring and doesn’t take account of enormous diversity in the needs of families and children.

We therefore make 30 recommendations, including that:

ParentsNext be abolished at the end of its current contracts and replaced with a supportive pre-vocational service developed via a co-design process and called ‘Your Future Planning’.
To allow sufficient time for a co-design process and not leave vulnerable parents without support, the current contracts be extended for the shortest time necessary.
In the interim, significant changes be made to ParentsNext to address the most serious concerns identified, predominantly in relation to the participation, reporting and compliance regimes and how Services Australia engages with people and providers.

The recommendations and Committee comments set out proposed draft design parameters to inform both a replacement service and more immediate interim changes to the current program including that:

Where funding is limited, prioritise a better-quality service to fewer people rather than compromise on core design principles.
There should be much greater use of support and incentives to encourage voluntary participation, including possible cash payments and a new ‘Skills Passport’.
Onerous reporting rules should be scrapped for all participants. Participation requirements should be radically reduced, as it is unreasonable to require parents caring for very young children to engage in a pre-employment program. Compelling evidence was received though that if there are no participation requirements at all, many of the most vulnerable parents would not engage. This brings a high risk of long-term unemployment and poverty including later in life.

As draft principles, we propose that participation be fully voluntary when a parent’s youngest child is under three, with a face-to-face check-in by Services Australia in the months after the youngest child turns two. In the years between three and six years old, there only be minimal requirements to attend periodic appointments and meaningfully participate (this does not mean activity reporting).

There should be a more intensive targeted service for vulnerable teenage and very young parents.
The Targeted Compliance Framework should be scrapped for parent participants. Payment penalties, cancellations and full payment suspensions should be removed entirely as parents should never be left with no money. Government needs a new mechanism to underpin requirements, proposed to be a partial payment withholding (‘holdback’) of a small percentage of a payment (which should not apply to Family Tax or other payments).
As a matter of principle, decisions impacting a participant’s income support should only be made by a government official, not by a staff member of a provider agency or automated via an IT system.
Government should seriously consider reducing competition between providers in a replacement service and having a public sector agency (probably Services Australia) deliver the service in at least a few Employment Regions.
Skills and competency standards to re-professionalise the sector should be introduced in the replacement service in a sensible, realistic way that values lived experience.

ParentsNext is not as bad as many say, but not as great as others claim. The Committee encourages those who may be involved in designing a replacement service to accept the values and key design principles outlined in this report, to respect the wisdom and positive intentions of the incredibly diverse range of stakeholders involved with the program, and not to let the perfect be the enemy of the good.

The Committee also thanks the Department of Employment and Workplace Relations, the Department of Social Services, and Services Australia for their constructive engagement with the inquiry.

We urge the Government to carefully consider this report and to act on the Committee’s recommendations, including the release of a transition plan by July 2023.

There has not been a shred of partisanship in this inquiry or this report, and I thank all my colleagues on the Committee for their engagement and for their collegial approach to this inquiry.

Mr Julian Hill MPCommittee Chair