Activating Jobseekers

How Australia Does It

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This report on the recent Australian experience with activation policies contains valuable lessons for other countries that need to improve the effectiveness of employment services and control benefit expenditure. It provides overview and assessment of labour market policies in Australia including the main institutions, benefit system, training programmes, employment incentives, and disability employment assistance.

Australia is unique among OECD countries in that its mainstream employment services are all delivered by over 100 for-profit and non-profit providers competing in a “quasi-market”, with their operations financed by service fees, employment outcome payments, and a special fund for measures that tackle jobseekers’ barriers to employment. In most other OECD countries, these services are delivered by the Public Employment Service. In the mid 2000s, several benefits previously paid without a job-search requirement were closed or reformed, bringing more people into the effective labour force.

Australia now has one of the highest employment rates in the OECD and this report concludes that its activation system deserves some of the credit for this relatively good performance. The Job Services Australia model, introduced in 2009, reinforced the focus on employment outcomes for highly-disadvantaged groups. This report assesses the latest model for activation and puts forward some recommendations to improve its effectiveness.


The institutional set-up of Australia's labour market policy and employment services

Labour market policy in Australia is primarily the responsibility of the Department of Education, Employment Workplace Relations (DEEWR) and two other departments, one of which manages Centrelink, the benefit administration body. Vocational training is mainly implemented by the states. The different public sector actors co-ordinate their work through “business partnership arrangements” and other policy agreements. DEEWR defines the conditions of contracts with private and not-for-profit employment service providers such as the schedule of payments, and monitors contract compliance and service quality. This helps to ensure consistent national implementation but it also results in administrative cost and complexity. The structure of Disability Employment Services is, following a long process of convergence, now fairly similar. Features promoting good governance include written submissions by stakeholders, including numerous employment service providers, to comment on proposed legislation and the conditions of new contracts. Associations that represent different professions and interest groups also actively analyse and advise on policies, based on the experiences of their member organisations, staff and service users.


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