Aug 22, 2003

Transcript of Doorstop interview: Job Network Bailout

Transcript of Doorstop Interview: Job Network Bailout NSW Parliament House

22ND AUGUST 2003

ALBANESE: The Government’s Job Network 3 system began on the 1st of July. They’ve had three years to get it right, three years to get it right for Job Network providers, and most importantly for the unemployed.

What’s happened is that the system’s been bungled for providers, and been bungled for those people it’s supposed to protect, the unemployed. On the 10th of July, the Government had to announce a $30 million bailout. That was because the Government has got it wrong in three ways.

Firstly in the modelling, in which it told Job Network Providers the amount of income it would get has been proven to be wrong. They said there would be 770 000 people in the system, it’s under 500 000, and the lack of cash flow meant that the Job Network providers have been literately shutting up doors, and putting off staff in order to survive.

The second issue is the Centrelink referral System where they adopted an automated referral system, which has meant that the individual job seekers aren’t getting the personalised service at that first step that they need.

The third, of course, is the disastrous IT System. This is an IT System that managed to match a 28-year-old Tasmanian man with an escort agency. It managed to match a 56-year-old woman from Daylesford in Victoria as a combat medic in the Army Reserve. It managed to advertise on the Job Network’s JobSearch website conducted by the Government, a job for money laundering as an employment option.

The simple fact is that Mal Brough must be the only person in Australia who didn’t know that July 1 was the day after June 30. They had a long time to get it right, and the Government simply got it wrong. On the 10th of July, the bailout was designed to keep Job Network providers going for just one month. What they said was, we’ll guarantee you the income which we projected you would get regardless of how many people are coming through your doors.

Today Minister Brough has addressed the NESA conference, the National Employment Services Association in Melbourne. And what occurred yesterday was that there was a meeting of CEOs of all Job Network providers. They indicated that two-thirds of them would be putting off staff in the next fortnight, and some of them would consider closing up offices simply because the system wasn’t financially viable.

Despite the fact that Minister Brough on Wednesday told Parliament that there would be no further bailout and that the system was functioning okay, today he had to announce that Job Network Providers will be paid the more than $2 billion in income that the next three years of the contract anticipated they would get, regardless of whether people go through their doors or not, and regardless of what the actual outcomes are for the unemployed.

This is a desperate attempt to keep the system going, from a Minister who simply, is presiding over a system he refuses to accept responsibility for. This is an extraordinary bailout from the Government, it resolves the problem for the providers, which is something that Labor Party has been calling for, but it leaves the big question unanswered of how the system will be changed to actually help the unemployed get into jobs.

JOURNALIST: How big a waste of taxpayers’ money is this Anthony?

ALBANESE: Well, what’s occurred is that Job Network providers according to NESA, not according to the Labor Party, but according to the Industry, are getting 40% less anticipated income than they expected.

Now if you then give a commitment that those providers will be paid payments, according to what the anticipated income would be, then you are talking about a top-up of something in the order of $850 million of tax payers funds being used.

We’re not critical of the Job Network providers, we’ve been very concerned and we’ve called for the Government for months to sort these problems out. The irony is, is that in the consultation phase leading up to July 1, Job Network providers themselves identified the problems, they told the Government where these weaknesses were in the system and the Government failed to act.

Now the Government has simply put a whole lot of Tax payers funds in, without saying how that money will be spent, without saying how that will fix the problems which are there in the IT system, in Centrelink referrals, in the JobSearch Database System, in the Kiosk System which still is not up and running and will not be up and running until the end of October.

JOURNALIST: (inaudible)

ALBANESE: No the Government certainly shouldn’t. And we’ve been calling upon Government action. Up until today, the Government has been denying that there was a problem.

The $30 million bailout that they did on the 10th July, they said was just to fix up a blimp in the system. Well the blimp is still there, but what’s extraordinary is that this is policy making on the run.

At the NESA dinner last night, at the Sofitel Hotel in Melbourne you had the extraordinary situation of the Employment Services Minister, Mal Brough going to a dinner where he didn’t get to eat anything. He didn’t get to eat anything because he was upstairs, with officials of the department, re-writing the policy overnight, re-writing his speech which that he would give this morning, because he recognised that Job Network providers were in revolt, that what the Labor Party has been saying for months is correct, and he needed to address that this morning, so that he didn’t cop flack, and an open revolt which occurred from CEO’s yesterday.

JOURNALIST: Should Brough get the brush off?

ALBANESE: In the transition between Job Network 1 and Job Network 2, it cost David Kemp his job. Quite frankly, this should cost Mal Brough his job. He should resign and put someone in charge, because again this morning, what Mal Brough has done is address the issues of Job Network Providers. That was important that that be done.

But there’s another group of people who the system is supposed to be about, and that is the unemployed.

And this morning Mal Brough vilified the unemployed, said it was all the unemployed’s fault, refused to take responsibility for the problems in the System.

At the end of the day, Job Network is a means to an end. It’s about getting long-term unemployed into jobs. And the fact is, is that the number of longer term unemployed, that is people who have been unemployed for more than 2 years in this nation, has increased from 135 000 since 1996 to 281 000 today. That’s a disgrace.

While some people are doing well and general unemployment level has declined, there are many people who are just missing out, and they are missing out because the System doesn’t have appropriate incentives to ensure that those people who most need assistance are getting it. And the Government’s got to address this issue.

JOURNALIST: I would just like to clarify that the Federal Government has now agree to pay what they say is already budgeted for, what’s wrong with them doing it now?

ALBANESE: Because the fact is, that payment which is budgeted for on the basis of outcomes. If you’re unemployed and you go into a Job Network office, which is compulsory of course, you get referred from Centrelink.

The Job Network provider then receives, a payment based upon getting someone into JobSearch training, then getting them into employment. What the Government has said today, is we’re going to going to guarantee that more than two billion dollars of funding regardless of the outcome, without giving any detail to the Job Network Providers, or without giving any detail to the unemployed, or without giving any detail to the Parliament of this nation.

What we’ve seen this week is Minister Tuckey, Minister Brough now misleading Parliament as well of course from the Prime Minister down who mislead parliament over the Manildra affair. It is outrageous that a commitment such as this could be given a major policy announcement the day after Parliament got up.

It’s a pattern with this Government, it’s a pattern to avoid accountability, and we intend, the hold the Government to account.

JOURNALIST: Simon Crean’s leadership seems to of have had a bit of a boost in the last couple of weeks due to the Manildra case, Wilson Tuckey affair don’t you think?

ALBANESE: Absolutely. I think that the Labor Party has had a very good fortnight in Parliament. I think that with this issue, once again, this is an issue in which the Labor Party has showed leadership, in which the Labor Party has sat down and has discussed with Job Network Providers the problems that they have. They received very well the address which I gave to the conference yesterday which outlines the way that Labor believes the System should be reformed. And as a result of that, you had a situation whereby a policy was re-written by a Minister and his department upstairs while downstairs 800 Job Network providers and people from the sector were actually having the annual dinner of the conference.

It’s the most extraordinary process of policy development I’ve have ever seen, no wonder Tony Abbott, who’s the senior Minister has no confidence in his Minister for Employment Services and is addressing the conference this afternoon. Because he didn’t have faith in Minister Brough to get it right. It’s very clear that Minister Brough hasn’t got it right, and he should move on, and allow someone to do the job who actually understands the System.

JOURNALIST: Does it seem ridiculous that they’re giving all this money to the Network without any strings attached, and yet we expect the unemployed to work very hard to keep up there end of the welfare bargain?

ALBANESE: Well look, you’ve had this week a number of examples whereby tax payer’s funds have been used to go to Manildra, you had an intervention by Wilson Tuckey in terms of his son, and extraordinarily 15 millionaires who are getting family tax benefits. And many, many people getting family tax benefits who earn incomes of over $100 000 a year. And I simply say this, compare the rhetoric of the Howard Government against those millionaires ripping off taxpayer’s funds, with their rhetoric against the unemployed who are breached consistently and of those breaches when they actually go to review, last year more than 80% of them were overturned because they were simply wrong.

It’s about time the Government actually looked after the unemployed, rather than specialising in vilifying them. What the Government has said, is that the problem with the system is that the unemployed simply aren’t turning up to meetings. Well the unemployed by and large were the same people who were unemployed before July 1.

Is it the case, that the Government’s arguing that people who were looking for a job by and large prior to July 1 have suddenly become Dole Bludgers? It is simply not the case. The problem is with the system. It isn’t with the Job Network Providers, and it’s certainly not with the overwhelming majority of the unemployed.