The Australian Government announced in its 2017 budget that it would trial random drug-testing of recipients of the Newstart Allowance and Youth Allowance in three locations from January 2018. Evidence suggests this approach will neither help people overcome addiction or find a job. Drawing on her recent article in the Australian Journal of Public Administration, Dr Sue Olney from the Public Service Research Group at UNSW Canberra explains why this is bad policy.
The Australian Government has declared that people in receipt of unemployment benefits should not be excused from mutual obligation activity because of issues related to drug abuse and is implementing a suite of measures “aimed at stabilising the lives of people with alcohol and drug abuse problems by encouraging them to participate in rehabilitation, counselling support or other appropriate treatment as part of their Job Plan” (Australian Government 2017:2). One of these measures is to trial random drug-testing of new recipients of the Newstart Allowance and Youth Allowance in three locations from January 2018 (Australian Government 2017:3), with the testing administered by a contracted third-party provider. Those who test positive will be placed on income management and referred to a contracted medical professional for assessment of their substance use issues and treatment options; those who refuse to comply with a test request will be penalised. The cost of this measure is commercial-in-confidence and has not been published (Australian Government 2017:3).
The three trial locations - Canterbury-Bankstown in New South Wales, Logan in Queensland, and Mandurah in Western Australia – were announced in August 2017 by the Ministers for Social Services and Human Services (Porter & Tudge 2017a, 2017b, 2017c). The Ministers’ announcements flagged drug abuse as a growing problem in each trial location, but made no mention of the local labour market – an interesting omission given the policy’s focus on substance abuse as a significant barrier to finding a job (Australian Government 2017:2).
The Prime Minister said the policy is “based on love”, designed to “make a change in people’s lives so they were not taking drugs, so they were not destroying their lives, so they were not destroying the lives of their families, so they were not making themselves unemployable” (Turnbull 2017). Yet the measures run counter to local and international evidence that drug-testing strategies are unlikely to produce these effects. Randomly drug-testing the unemployed will adversely affect both the wellbeing and the employment prospects of those tested and generate significant flow-on costs in terms of testing, enforcement, treatment, crime, emergency relief, housing stress, mental health and further stigma of the long-term unemployed in the job market (Australian National Council on Drugs 2013; Covert 2015; Macdonald et al. 2001; Wincup 2014; Arthur 2017; Royal Australasian College of Physicians 2017; Bray et al. 2012; Buckmaster & Ey 2012; Ezard 2017; Reynolds 2017; Lintzeris 2017; Wodak 2017; Trimingham & Vumbaca 2017; Whiteford 2017a). More broadly, the policy fails to distinguish between substance abuse as a cause of welfare dependency and substance abuse as a consequence of structural labour market exclusion – different problems calling for very different policy responses. Treatment for drug and alcohol abuse is not a guaranteed pathway from welfare to work while over 800,000 Newstart and Youth Allowance recipients and over one million underemployed workers willing and able to work more hours are competing to fill fewer than 200,000 job vacancies (Whiteford 2017b; Australian Bureau of Statistics 2017a; Australian Bureau of Statistics 2017b).
The core issue ignored in this policy is that the jobseekers it targets are a workforce of last resort in a flooded labour market. Their relationship with the employment services system has been reduced to an obligation to meet activity requirements for income support by moving around government-funded services and programs, facilitated and monitored by their employment consultant. There is no evidence that drug-testing and income management will change that, either by reducing substance abuse or by increasing employment outcomes, and it carries a high risk of unintended and expensive consequences across government and the community. The Prime Minister may believe that tough love can divert the unemployed away from drugs and into work, but evidence suggests the funding for this policy would be better spent on dismantling structural barriers to work for the long-term unemployed. Those implementing the new policy will struggle to achieve its stated aims and to contain the flow-on social and economic costs of imposing further obligations for income support on already marginalised citizens in the current labour market.