Annual Report 2002–03 Volume I
Key strategies and activities
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- Environmental indicators and analysis
- Social justice and equity impact
- Performance highlights and policy outlook
- Work is required to
- Policy outlook
- Measures from Portfolio Budget Statements and Portfolio Additional Estimates Statements
Key strategies and activitiesThe key strategies and activities for improving social and economic participation are: implementing measures under the Australian Working Together (AWT) package to integrate income support with services tailored to individual needs. Key activities include: introducing the Personal Support Programme and provision of additional places in disability employment assistance and rehabilitation services developing new participation requirements for mature-age people and parents of older children, modifying the breach penalty system, and working on changes to Disability Support Pension requirements introducing expert assessments of work capacity and improved support to help people participate, particularly those who have a disability or face multiple barriers, focusing on early intervention. undertaking research and analysis to help FaCS understand its clients, their circumstances, needs and aspirations promoting participation, independence and self reliance among older Australians through policy development, education and advisory services. FaCS implements these strategies through relationships with other levels of government, business and community-based and private organisations, service providers and formal purchaser-provider relationships with Australian Government agencies such as Centrelink. Environmental indicators and analysisThroughout 2002–03 the reasonably robust Australian economy resulted in improvements in the labour market, including increased employment, a decrease in unemployment and decreased reliance on income support. In the year to June 2003 the number of people employed in Australia grew by over 2 per cent, a higher rate of growth compared to the 1.6 percent achieved the previous year. Unemployment decreased over the year from 6.3 per cent of the labour force in June 2002 to 6.1 per cent in June 2003. Over the same period the number of unemployed people in receipt of Newstart Allowance decreased by about 6 per cent (33 100) to 521 700. The decrease in unemployment was not consistent across regions: six in 10 Australian Bureau of Statistics (ABS) statistical regions experienced decreases in unemployment rates in the year to June 20031. The number of people of workforce age2 on income support payments (excluding veteran payments) also decreased over the year, down from 2.58 million to 2.55 million people (20 per cent of whom only receive a portion of the maximum rate of income support). This 2.55 million represents just under 20 per cent of the Australian workforce-age population. The number of jobless families with dependent children under 15 and/or dependent students aged 15-24 decreased by 6.6 per cent this year to 417 000. This compares with a decrease of 1 per cent in the number of families. 1 ABS 6291.0.55.001 Labour Force, Australia. 2 16–64 for males and 16–61 for females in June 2003. About 17 per cent of people of workforce age (1998) disclose that they have a disability. It is important to note that people who self-identify as having a disability are not a homogenous group, with considerable variation in the extent and significance of the disability and the impact on their ability to work. The prevalence of disability increases in older age groups, with around 22.6 per cent of those aged 45-54 having a disability, rising to 38.7 per cent of those aged 60-64. This trend is consistently reflected in the high take-up of Disability Support Pension (DSP) by older people, with one-third of new DSP grants made to applicants over 55 years of age. The three main conditions prevalent in the DSP population are musculo-skeletal conditions (34 per cent), psychiatric conditions (25 per cent) and intellectual disabilities (11 per cent). Approximately one in 19 people of workforce age are now receiving DSP. Carers are playing an increasingly important role in the community. Over 56 per cent of primary carers are women of working age. The ageing of the population sees a growing demand for carers but also an increase in the number of older carers with around 65 000 carers aged 65 years or over receiving Carer Payment and/or Carer Allowance, at June 2003. Young carers are a group particularly at risk of isolation from the community and disconnection from education and employment opportunities. Around 6500 carers aged 25 years and under were receiving Carer Payment and/or Carer Allowance at June 2003. Australia’s population is expected to age markedly over coming decades with the proportion of the population aged 65 and over forecast to increase from its current 12 per cent to 18 per cent in 2021. At June 2003, of age pensioners who have been receiving Age Pension for one year or less, 54.7 per cent received full rate while 45.3 per cent received a part-rate pension due to the level of their income or assets. In June 2002, the proportions were 51.8 per cent and 48.2 per cent respectively. The relatively low rates of labour force participation among those approaching Age Pension age or above has an impact on their capacity to save for retirement. More than 50 per cent of people who come on to Age Pension were previously receiving another income support payment. At June 2003, labour force participation rates for people aged 65 and over were 10.5 per cent for men and 3.2 per cent for women, results that have been stable for some years. Social justice and equity impactThe range of outputs and payments under this outcome are designed to encourage self reliance, economic and social participation and to maintain an effective, sustainable safety net. A central focus is to improve the work prospects of people of working age to reduce the number of jobless families. Support for those who cannot work because of caring responsibilities is an important part of this strategy, as is assisting those with older children into work. Performance highlights and policy outlookKey achievements included:progress on or implementation of a range of AWT measures designed to support increased participation of groups facing barriers: the Better Assessment and Early Intervention measure included the provision of medical and work capacity assessments for people with disabilities, focusing on early intervention. The measure is producing expected customer impacts such as a decrease of 20 per cent in the overall number of DSP grants and a 28 per cent fall in the number of Newstart Allowance and Youth Allowance customers with an activity test exemption due to incapacity. disability employment assistance services received a major boost through an extra 7130 places provided for job seekers with disabilities. A focus in 2002–03 was putting in place strategies to position business services as a viable and robust employment choice for people with disabilities, offering quality services and fair and transparent wages. the Personal Support Programme, which started 1 July 2002, exceeded its target of assisting 25 000 people with multiple non-vocational barriers that make it difficult for them to work 450 Personal Advisers began in Centrelink offices to help mature-age people and parents engage with the workforce or take up social opportunities. More than 95 000 eligible clients have accessed their services and more than 50 000 participation plans have been put in place. It is too early to assess the impact in terms of reduced reliance on income support. Job Education and Training advisers assisted 25 162 eligible clients, including helping them develop participation plans with a focus on an eventual employment outcome, even if that is a long-term goal. progress was made on policy work to prepare for other initiatives such as Working Credit and new participation requirements for parents and mature-age unemployed people. changes were made to breaching arrangements to ensure vulnerable job seekers are protected while those able to meet participation requirements take appropriate steps to maximise their job prospects. consultations and active involvement of stakeholders in policy design were central to much of this work. National consultations in November 2002, following the end of the three-year case based funding trial, resulted in the design of a fee-for-service funding model with more transparency and better incentives to provide employment support to people with disabilities. a major role for FaCS in policy debates about population ageing through conference papers and presentations to peak seniors groups, industry and state agencies, and on retirement incomes through submissions to major parliamentary enquiries signing of the Commonwealth State Territory Disability Agreement by six states and territories. All jurisdictions have agreed to work together to deal with access issues and improve flexibility between Australian Government and state services. The new agreement means greater accountability for disability spending across Australia. The Australian Government will provide nearly $5 billion over five years for disability services responsibilities including employment compared with $3.2 billion in the last agreement.
foster further collaboration with Centrelink and other Australian Government agencies to increase and streamline referrals to programs of assistance. It will be essential to improve timely access to client data to monitor the impacts of measures and inform future policy development. Responding to recommendations from ANAO audits of Parenting Payment Single and Age Pension entitlements will also emphasise performance information reporting for business assurance. Policy outlookThe policy outlook for the coming year and beyond will see a major focus on the implications of an ageing population on both income support and demand for services. These include the impact of a shrinking workforce, the support and service needs of people with disabilities, the situation of ageing carers, and ways to encourage workforce participation of mature-age people, and longer-term planning and management of demand under the Commonwealth State Territory Disability Agreement, with joined-up services between Australian Government and states and territories to make sure people get the right services at the right time. The Employer Incentives Review completed in 2002 provides the basis for strategies to encourage employers to recruit more people with disabilities. More work also needs to be done to understand the particular issues facing long-term unemployed people, including geographic and personal issues (such as mental health) that need to be addressed to help them find and keep work. Finally, research on Parenting Payment recipients points to the need to explore ways to intervene earlier to better support parents through life transitions such as separation or repartnering that can impact on self reliance and participation. Measures from Portfolio Budget Statements and Portfolio Additional Estimates StatementsFaCS took significant steps this year through its Budget measures to improve participation and engagement and to support individuals so they can contribute to the best of their ability. The AWT measures, Personal Support Programme and Personal Advisers, were introduced to increase participation by responding to the individual circumstances of each client. Another key AWT element, Working Credit, which started on 20 September 2003, also seeks to engage more clients and help them return to work. Better Monitoring of Preparing for Work Activity Agreements saw reviews of nearly 87 000 agreements completed this year with the aim of ensuring participation requirements more closely reflected job seekers’ capacity to participate. Unemployed clients also benefited from significantly lighter penalties through the Reduced Penalties for Non-attendance at Interviews measure. The Extension of Waiver Provisions for those facing a breach penalty resulted in over 4000 penalties waived in 2002–03 because clients started a program of rehabilitation or specified vocational training. To encourage social and economic participation, activity testing was introduced for certain Nominated Visa Holders Special Benefit clients from 1 January 2003. Under the activity test certain special beneficiaries are required to seek and accept suitable work, actively improve their employment prospects and contribute to the community. The 2002–03 Budget included reforms to the DSP to recognise and improve the work capacity of people with disabilities. Two measures to improve Centrelink work capacity assessments and medical assessments for conditions likely to change were successfully implemented on 20 September 2002. Legislation has not yet been passed to give effect to the third measure to tighten DSP eligibility provisions in the Social Security Act 1991. Increasing individual self reliance and directing payments to those most in need is pivotal to maintaining a strong and sustainable income support safety net. A number of measures were implemented including changes to gifting rules which reduce the scope for people to increase their pension because of significant monetary gifts. Changes were also implemented to ensure the consistent application of the means test when an individual’s superannuation assets are split with a former partner, in response to family law changes. A measure to modify the existing income test treatment of non-economic loss compensation payments, which required legislative change, was not progressed. Carer Payment legislation amended in November 2002 makes it easier for carers of children with a terminal illness to receive the payment. New and revised international social security agreements were implemented with Austria, Portugal, the United States, Canada, Spain and The Netherlands, which will improve access to income support for people whose adult lives are spent in both Australia and the agreement countries. Changes to social security arrangements with New Zealand are being effectively administered to ensure that eligible people receive appropriate benefits. Centrelink issues 99.5 per cent of certificates of residence confirming social security status for eligible New Zealand citizens living in Australia, within 3 days of application. In all, 6750 certificates were issued from 26 February 2001 to 1 July 2003. Under the social security agreement between Australia and New Zealand, DSP claimants who have previously resided in New Zealand, are assessed to determine the severity of disablement, as they may also qualify for New Zealand Invalid Benefit. 350 referrals for assessment were made in the 12 months to 1 July 2003. Under the third Commonwealth State Territory Disability Agreement, the Australian Government will provide nearly $5 billion over five years for disability services, including $2.8 billion for states and territories to assist them with their responsibilities compared with $1.9 billion in the second agreement. A total of $2.1 billion will be invested by the Australian Government to meet its responsibilities for specialist employment services for people with disabilities compared with $1.3 billion in the last agreement.
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