Social Services Minister Christian Porter has probably done everyone, even the poor, a favour by reminding us all that the main reason the poor tend to become entrenched and dependent on welfare is because they don't have jobs, or houses, are sick or disabled, or have responsibilities for others which inhibit their capacity to earn an income.
It's not a profound revelation. Nor is the fact, trotted out at no-doubt-fabulous cost as a discovery by PricewaterhouseCoopers actuaries, that the cost of sustaining people in welfare dependency for a very long time is often much more than the cost of actually providing housing, creating real jobs, helping people address illness and disability, and providing some help with looking after children or elderly relatives. Indeed, that one can "invest" in particular subsets of those on welfare by "intervening" at some critical point of their interaction with the welfare system. This can ultimately reduce the overall welfare bill which, as all Australians know, is enormous, getting more enormous and will ultimately swallow us all up.
Porter was out marketing at least some of these insights this week, picking up on policy initiatives in New Zealand, the urgings of the McClure report into the welfare system, and some earlier gurglings about welfare "reform" coming from now Treasurer, Scott Morrison, during the brief (Tony Abbott) period in which Morrison was Porter's immediate predecessor at social services.
(Morrison's sincerity on real reform can be judged by the alacrity with which he picked up on a cue this week from his shock-jock friend, Ray Hadley, to promise further scourgings of some young unemployed girls who expressed distaste about working for McDonald's. Most of the time, there are more votes in pandering to perceptions that most of the unemployed are just bludging, or too picky to accept the few jobs that are available.)
Porter seemed to be promising something else. A well-financed investigation for out-of-left-field ideas about critical interventions, or "investments", in welfare that just might get people into secure jobs, or at least placements that could stop them from a life of dependence on the public purse. Investments that might pay off in the medium term if they actually succeed in changing people's lives or, at least, in reducing the drain on the public purse. Restricted to the sensible, of course. Let's not have too much talk of actually providing houses, or creating real jobs.
For some people, temporary reliance on welfare is at worst an incident between jobs or occupations. Others seem to be trapped there, unable, sometimes perhaps unwilling, to determinably seek to live lives independent of the taxpayer. There is a whole industry of self-reliance and work-ethic "experts" paid a good deal of public money to encourage the idea that the victims are to blame. They talk loudly of heritable transfer of welfare dependence. Of families in which no one has worked for generations. Where children not only fail to learn splendid habits of getting up early, recognition of the virtue of industry and independence, and taking work as an incident of life, but also fail to attend schools, suffer poor health, and develop ingrained habits of sloth, idleness and dumb insolence. Feckless folk, often cunning but less than honest and ambitious, all too often additionally burdened by habits of drug and alcohol abuse, and violence in the environments in which they live.
The accepted wisdom of these experts was acquired from experience of dealing with the London criminal classes and hopeless poor, and Irish Catholics in 19th century Britain and Australia. These insights, particularly at the political level, have not much developed and have a distinct whiff of 19th century Methodism. They hold that second and third generational welfare dependence virtually dooms one to life on the scrap heap, albeit at high cost to the taxpayer.
Over time, these insights have been visited upon migrants and Aborigines. Public policy leans to the stick rather than the carrot, but often with violent swings between, on the one hand, coercive and punitive regimes, including detention, coercion and arbitrary removal of access to benefits, and, on the other hand, well-meaning but ill-conceived packages of incentives, bribes and promises, almost designed to fail.
Porter is proposing to give the experts industry about $100 million to brainstorm fresh and original ideas about forms of intervention and "investment" against those at risk of long-term welfare dependency. They will look for the "moments" at which some seem to succeed in weaning themselves from benefits but others seem to become, if anything, more dependent. It's at such a point that an investment is to be made. There's also, of course, the modern, bipartisan notion of mutual obligation, by which those who fail to play the game will be identified and punished, no doubt by being taken off benefits and left to starve for their own good.
One shouldn't get too excited on behalf of the poor, or even on behalf of the poor and oppressed taxpayer.
It seems already clear that the scheme, such as it is, is rather more a public relations confection than a genuine attempt to address the real problems of welfare dependency. That this is so can be seen by the way that its Australian proponents are focused on "nice" cases, rather than serious problems of chronic and grinding poverty. Poverty and indignity made worse by policies of demanding a good deal of arbitrary pointless activity for no purpose as the price of humiliation and powerlessness.
So far as real welfare is concerned, Australia already has one of the most targeted systems in the world. There's not much scope for cuts, and critical benefits, especially for unemployment, are, if anything, far too low. Our system is also one of the most discretionary, in the sense that bureaucrats can and do suspend payments even when there has been no change in a person or family's situation. This stick approach is designed to impress on beneficiaries that they are at the mercy of officials of the state, and that their condition is regarded as primarily their own fault.
More likely than not – and New Zealand precedents seem to confirm this – the failure of well-meaning interventions will be used to compound impressions that those being experimented on are incorrigible and to be marked for punishment, probably removal from benefits.
Porter has manfully conceded that an "investment" approach doesn't necessarily save money in the short term. But those obsessed by Australia's fairly modest welfare bill (one, in quantity and quality, well below international first-world norms, at least if one drops the callous United States from calculations) are primarily in the game for savings, in the short as much as the medium term. It's part of the mindset. For many, indeed, it would be a primary error to drop the US for comparison purposes, because the sink-or-swim US economy and welfare system is precisely the sort of cruel work and living environment they want. The comparative lack of safety nets keeps wages down, has hollowed out the American middle class and ossified the condition of the poor. The bonus, in the US, has seemed to involve persuading a good many "real" (white) Americans that the cause of their economic and social misery is that others, including blacks, Hispanics, and migrants, are hooked on welfare. Actually, redneck Trump constituencies are often on welfare, and regard it as their right, even as they proclaim the virtues of limited government. They have just not got used to the idea that others deserved similar rights.
Australian families in which at least one person is working have long been encouraged to resent families in which no one is employed. There's an active media obsessed with the idea that such people – even those on benefits as single mothers, disability or invalidity – are bludgers, shirkers and scroungers, unless they are in clear and quick transit between jobs. Only the receipt of middle-class welfare, such as family-tax benefits, student allowances, and tax expenditures such as superannuation concessions, are automatically reasonable forms of government spending. That, after all, goes to those who are lifters, not leaners, strivers and not skivers.
Some of the sleight of hand was apparent even during Christian Porter's warm, caring-and-sharing speech at the National Press Club on Tuesday. The PwC investigation had suggested three groups who might be saved by long-term welfare degradation by skillful (though unspecified) interventions at the right stage of their interactions with Centrelink. One group were young carers: the 11,000 people, according to PwC calculations, receiving some welfare aid because they are looking after an invalid relative. Another were (single) parents under the age of 18: 4370 in number. Then there was a subset of students getting some welfare aid to carry on their studies but at risk of not successfully transiting into the job market. Some are seemingly doomed to have their hand out to government until they reached the age of 65, after which they go on to the age pension. Philosophers, perhaps, or TV repair-folk.
The report had some breathtaking figures about the long-term cost of welfare dependency, though these were very generously bulked up by the cost of the aged pension, various forms of aged-care subsidy and assistance, and by the cost of Howard-era family-tax benefits, eligibility for which extends well into the middle classes.
Porter worries that the lifetime welfare bill for the present population, going up to the year 2085, will be $4.8 trillion, which is to say, $4800 billion dollars. That sounds like an awful lot, and indeed it is. But it should be considered in perspective. It is, for example, almost three times the current annual Australian gross domestic income, but is a bill to be paid over the next 70 years. Put another way, as Greg Jericho calculated in the Guardian, Australian government "lifetime" spending over the same period, presuming it grows at its current rates, will be about $360 trillion. That hardly suggests that the welfare bill is unsustainable or obviously too high.
Nor do the figures, taking the PwC calculations, which are based on various Bureau of Statistics and welfare roll figures, suggest either that long-term welfare dependency is actually an enormous problem, a growing one, or that it is striking particularly among the groups that PwC has suggested for helpful intervention or investment.
A proportion of those who have no jobs or non-government income are virtually unemployable without massive intervention at individual, family and community level. They lack the skills and the education to get available jobs, anywhere. In many cases, they live in areas where there is high unemployment, particularly in rural and remote areas, but it isn't always obvious that their prospects would be much improved merely by moving elsewhere, permanently or temporarily. If anything, such a move would only further emphasise their disadvantage in the job market and, often, their poverty and capacity to survive would be adversely affected by the fact that they are removed from family and the community from which they come.
In some such cases there has been high unemployment for decades, and there are families in which parents have never worked, or not worked for many years. The demographics of such families, often clustered together in government-created enclaves, are often noticeably different from those of the wider Australian community, even if the rules have been carefully constructed by Centrelink as if everyone is in a provident English-fluent, two-parent, two-child family.
About a third of the underclass are Indigenous (though these represent fewer than a half of the Indigenous population). Many of these face discrimination and disadvantage going beyond mere poverty, a want of physical and social capital, and poor health profiles. Their situation is buried in the PwC data; they don't even rate a mention. How welfare might be better tailored to their needs or to the needs of others in similar situations seem to have eluded the PwC actuaries and the PR gloss about really meaning to make a difference this time. By doing something. Or other.
Naturally, Labor is on-board, in principle at least. Thank heavens there are some professionals, such as in the St Vincent de Paul Society, who can speak for, rather than of, or to, the poor. Otherwise we might get overexcited about the discovery of answers to questions not even asked.
Jack Waterford is a former editor of The Canberra Times.
