ACT welfare groups say changes to work for the dole will undermine the safety net, and make young people vulnerable to dodgy employers, as the territory experiences some of the highest youth unemployment in the country.
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The federal government program, starting from July 1 next year, will mean job seekers under 30 will have to carry out up to 25 hours of community service and apply for 40 jobs a month.
The expansion of the work for the dole program will last for three years and will cost $5.1 billion. Unemployed people aged up to 49 will have to perform some work for payments.
Emma Robertson, director of the Youth Coalition of the ACT said work for the dole "doesn't work" and will push young job seekers over the edge.
"People will turn to things that they wouldn't otherwise, it's not just crime, particularly young people will be vulnerable to dodgy employers because they will have to take whatever job they can in order to eat," Ms Robertson said.
Ms Robertson said the changes could create situations akin to ghettos for those without familial support "because poverty is intergenerational".
Susan Helyar, director of ACT Australian Council of Social Service (ACOSS), said the system would distract job seekers from building their skills and applying for jobs suitable to their experience.
"Applying for that amount of jobs where there aren’t that many jobs available just creates activity for the job seeker and a burden for employers who have to go through lots and lots of job applications," she said.
"Work for the dole jobs are short term, they are not always helping with building a skill set that is useful, and stop people focusing on their education or development that will actually get them off welfare."
The ACT government has also expressed concern over the expansion of the program.
A spokeswoman for the ACT Minister for Community Services Mick Gentleman said it was “disappointing” to see the government taking assistance away from young people.
“We should be helping our young people as much as possible to find a job, but these changes do the opposite,” Mr Gentleman said.
He said the changes would put extra strain on local providers and community organisations.
ACT Minister for Corrections Shane Rattenbury, MLA, said he was worried by the policy's potential effects on young detainees after they left the Alexander Maconochie Centre and started searching for work.
"The proposed changes to Centrelink payments will likely create further challenges for our detainees who already struggle to find work post release," Mr Rattenbury said.
"I would like to see the federal government provide greater support for people to engage in education and training and find employment, rather than just creating further barriers."
Under the changes, there will also be employer subsidies to hire, train and retain older job seekers.
