McClure Report a challenge for the new Scott Morrison

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Scott Morrison holding McClure Report

Scott Morrison is in a real quandary. As new Social Services Minister, he has moved quickly to soften his rhetoric, move away from the tough stance he took in the Immigration portfolio, and manoeuvre for a chance to rise further in the game of snakes and ladders of Federal politics.

Morrison’s timing might be good, but Patrick McClure’s is very bad. McClure has now presented Morrison with a massively controversial report on welfare reform which would significantly reduce the incomes of a million marginalised Australians. Morrison is caught on the horns of a dilemma: he can pursue the tough changes McClure calls for, which accord with Government policies, or he can kick the ball into touch.  

So much has happened in the past year that we can easily forget that the last Budget effectively launched a new program of welfare reform in Australia. The approach to the Disability Support Benefit (DSP) embodied in the Budget was a crossing of the Rubicon.  Before the Budget, DSP recipients did not have to seek work, and they could use the modest income support of this pension to survive frugally. But now, most DSP recipients under 35 have lost the guarantee of income support. Historically DSP has been justified from a sense of compassion for the people with disability. The policy is now that people with significant impairments should seek to make a contribution to society economically through work.  

McClure’s final report has effectively endorsed this view. He proposes major changes to the welfare system and effectively supports the Budget position. In my submission to the review, I called for McClure to retain the ambition of a single working age payment which he called for some 15 years ago. In his final report he has returned to this position. He proposes a single working age payment for persons who have less than the most profound disabilities: permanent disabilities which prohibit them from working 8 hours or more a week. People in this challenging position would retain a pension payment which is effectively now the DSP. However, those with a non-permanent disability or who can work 8-or more hours a week would receive a working age payment. The new working age payment has three tiers. The upper tier would be for people with disability who can work 8-14 hours a week, the middle tier is for those with 15-29 hours of work capacity and includes those with dependent children, and a third tier for others now on DSP which is effectively the current Newstart regime.

What is proposed is to move people on DSP onto a new payment which is merged with Newstart but in different streams that reflect differential work capacities. Persons on parenting payment are also merged into this scheme. Youth Allowance is proposed to be abolished with all payments for persons under 23 directed to parents not to the youth themselves including for students.  

In my submission, I called for current payment levels to be retained. However, McClure proposes that payments rates fall for people with disability and on Parenting Payment who attract the new working age payment although there would be transitional arrangements to ensure the change was done more gradually. There may be some top up payments for people with disability and single parents who are not working. There would be participation requirements for these people, but these are not well described. McClure appears to accept the Budget measure to remove linking of pension payments to changes in wage levels which also means a reduction of current payment level for those now on DSP in real terms by 30.5 per cent over the current average 14.5 year duration of persons on this payment. This is a massive reduction in the living standards of persons with less than the most profound of disabilities.  

Catholic social teaching does support measures to encourage persons with a work capacity to enjoy the dignity of work. However, the stronger emphasis in the weight of this body of thought is the preferential option for the poor. Although McClure’s proposals create greater incentives for people to gain the dignity of work the sting in the tail is that there will be a substantial reduction in payment levels for most persons now on DSP or Parenting Payment.

In my view, McClure’s report has failed the test of Catholic Social Teaching. Reducing subsistence income for people on welfare is not consistent with the preferential option for the poor. Reducing payments to people with disability or single parents is not the best way to empower them to attain their work aspirations.  


Brendan LongDr Brendan Long is an economist and social policy analyst working for the Australian Centre for Christianity and Culture at Charles Sturt University in Canberra.

 

 

Topic tags: Brendan Long, Patrick McClure, Scott Morrison, Welfare, McClure Report, Catholic social teaching, Disabili

 

 

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Existing comments

I cannot evade pasting the following ,recent inspired words from Father Richard Rohr ,for no statement can surpass them "Throughout Scripture there is a call for social justice--meaning social equality, inclusion of those on the edge. It is a deeply spiritual call, and yet it has a powerful and important political function. . . . Those on the edge hold the key to healing and uniting the whole system. To unite with those who are the most vulnerable, the most excluded, is the critical social dimension of unitive consciousness and community. You cannot believe in or practice unitive consciousness as long as you exclude and marginalize others--whether it is women or people of different sexual orientations or people of religious or ethnic minorities or, in my experience, people with intellectual disabilities" Regards John
john kersh | 01 March 2015


A thought provoking article but what is meant by "kick the ball into touch".
Mike | 02 March 2015


The major problem with tying disability pensions to any limited ability to work is the assumption that work for disabled people is readily available. With increasing unemployment, work is not available for all fully able people, let alone those with a disability. Added to the lack of work opportunities in general is the fact that most workplaces are not set up for persons with motor disabilities or sight disabilities. And for persons with hearing and/or speech disabilities, employment opportunities are very much limited by the natural reluctance of employers to take on yet another potential workplace challenge. A CPI-indexed minimum living wage for all citizens and permanent residents, supported by adequate revenue policy and practice remains the most equitable and practical welfare goal.
Ian Fraser | 02 March 2015


I agree with Ian Fraser. I know lots of people (some of them disabled) who are very keen to work but suitable work is not available for them locally. By suitable I mean commensurate with their health and skills. By locally I mean within reasonable distance by public transport. To move away to find suitable work has costs that negate any income they may derive from employment.
Uncle Pat | 02 March 2015


Most decent people are concerned with growing inequality in the community. Here we have a proposal to reduce the incomes of people who are already the least wealthy, because that's just what we need: yet faster growing inequality.
Russell | 04 March 2015


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