Social Policy Whisperer: Andrew Forrest and the Government's welfare nightmare


Years of research neglect have left the Abbott government ill prepared for the challenge of welfare reform. Its first budget disaster arose precisely because it did not understand the post financial crisis policy context. Its calls for economic heavy lifting have not been matched by distributional fairness. Having experienced a period of economic reform when the benefits went disproportionately to the rich, people now simply wont buy an economic reform program which is not also socially inclusive. The question is can the government learn quickly enough on the job to get its social policy agenda on track before the next election?

I say ‘years of research neglect’ because so much of its welfare agenda to date has a decidedly late twentieth century feel. Even Treasurer Hockey’s signature tune of ending the age of entitlement has a ‘ho hum, not that again’ feel.   We went there and did all that - and with so much more style! - in the mid 1990s. Remember Bill Clinton ‘ending welfare as we know it’ and its Aussie echo with ‘ending welfare dependency’ a la Janet Newman, Noel Pearson, Peter Botsman and Co ? Another big noise from the period was Fred Hilmer’s national competition policy with its aim of marketising employment services. Lo and behold today we have ‘Hilmer Mark 2’, a competition policy review aiming among other things for a new wave of social service privatisation.   Then, of course, Patrick McLure was resurrected for the ‘welfare reform’ process which initially at least also seemed to travel back in time to have a second go at streamlining the number of payments – possibly useful, but hardly welfare history in the making.

It really does make you wonder what the government was doing about social policy renewal in its period of opposition. Its not simply that all the key research themes of the last decade eg social inclusion, capability theory, the social investment state, inclusive growth are missing. More important is the absence of any sense that history ended up punishing policy approaches which privileged economic efficiency to the neglect of any social justice dimension. No one understood that better than John Howard himself.

Now in the absence of the hard work of policy renewal the political chickens are coming home to roost. Old policies are being recycled seemingly without any sense that they have been tried and failed. For example, Professor Borland’s research on the failure of the ill named ‘work for the dole’ program is simply ignored. Nobody gives any credit to claims that forty job applications a month will do any good to enhance employability. No interest is shown in the widespread feedback that the current pitiful unemployment allowances impede rather than assist people making a good transition back into the workforce. In so many of these areas it is not just policy researchers who are shaking their heads in dismay but also a wide cross section of community groups including business peak bodies.

The big danger with a government floundering in a policy research vacuum is the possibility of whacky ideas taking hold for ideological reasons. Only today (Friday August1) for example the ‘billionaire mining magnate’ Andrew Forrest reported his ideas on welfare reform for indigenous people to the Prime Minister. The headline report in the media dwells on the new technological fix which will create a ‘healthy welfare card’ which will control what people can get in a ‘cashless economy’. Dutifully people like Noel Pearson and Warren Mundine revved up a supporting chorus on the evils of welfare dependency while the Australian’s editorial correctly located the intellectual origins of the approach at the ‘turn of the century’ when ‘several key thinkers and policy makers including Peter Botsman, Noel Pearson and Mark Latham … identified the long-term, corrosive effects of passive welfare’.


These days political leaders simply cannot get away with this routine beating of the ‘passive welfare dependency’ drum and hoping the electorate will be satisfied. More now is expected of government. The evidence is overwhelming that only a very small percentage of people remain on welfare for long periods – as Whiteford has argued, statistically we do not have a welfare dependency problem. Perhaps more importantly people today are far more inclined to see unemployment for what it really is: not a moral failure of individuals but either a failure of economic policy to provide enough jobs or, when the jobs are there, a failure of labour market programs to provide adequate support for those looking for work. This is a huge shift from the days of Botsman and Co. People want to know where the good jobs are going to come from? And do we have the right education and training to equip people for them. If policy makers cannot answer these questions then their attacks on the unemployed seem more and more like simple moral bullying.

In government of course parties do have far more resources – if not the leisure – for policy development. Government departments have policy people who are abreast of the main lines of welfare research progress over the last decade or so. In this regard I think the McClure reform process does show promise. While it has gestured strongly to coalition ideology around disability payments and income management the discussion paper also gives space to themes like social investment and place based initiatives. In his opening address to this week’s Australian Institute of Family Studies conference Minister Andrews spoke at length on ‘social investment’ and the ‘life course’. These developments suggest a Minister and Department of Social Services learning quickly on the job. Whether this can make up for the apparent years of neglect and whether it can overcome the entrenched welfare conservatism in other government departments and government support groups like the Australian remains to be seen.

By Prof. Paul Smyth

Posted by Gemma Carey