Sole Parents Are Not A Workforce


How do public servants explain bad policy to the people it affects? It is relatively easy for Labor ministers Bill Shorten and Kim Carr to do a quick doorstop and justify their government’s policy changes to sole parent payments, but they aren’t face to face with the people affected by the changes. It is much harder for the 300 Human Services staff who are now contacting 84,000 sole parents to explain how a cut of at least $60 per week will be of benefit to them.

Senator Carr seems to have an inkling that the changes may be hard to sell. In a media release, he said that he has ordered Centrelink officers to personally contact all parents who are being forced off their parenting payments in January, "to ensure that they are placed on the best welfare payment they can get".

When interviewed by the ABC last week, Carr initially implied that many parents may stay at current payment levels by transferring to carer or disability payments. When pushed for numbers, he suggested maybe 3000 might qualify to stay on current rates, but then he admitted maybe another 10,000 would lose most or all of their income support payment.

Newstart is both lower than parenting payment and tapers off more sharply. So, while a few may survive on the current payment, more will lose all their payments and related concessions, and the bulk will just get paid less from 1 January. The changes will save the government $728 million over four years but will cost single parents up to $223 a fortnight.

Labor claims they are making these changes to give parents an incentive to go back to paid work. But there is no evidence that cutting already inadequate incomes actually results in more parental workforce participation. Instead, research shows the reverse: most parents’ priority is caring for their children, so even after cutting income and making each additional hour’s work less profitable, inadequate payments may still be the more attractive option — they give predictability and time to be with your children. Further, abstaining from work reduces anxieties about child minding and cuts costs in transport, food and the like.

This scenario came out in the research I did some years ago that made it clear that, while sole parents want jobs, the care needs of their children come first. As few employers offer work to fit with school hours and are prepared to adapt to children’s time demands, the reality in place now for thousands of sole parents is less income and the demands of seeking non-existent jobs. Living in rural areas or distant suburbs that lack transport, and having other characteristics that most employers reject, make combining good parenting and paid work very hard for sole parents.

The new policy’s bad design is evident in an example of the changes from the Gillard Government’s submission to the Senate Inquiry into the adequacy of Newstart. The government’s own submission gives the following example of its "benefits":

"As an example for the senate inquiry we show how a sole parent on Parenting Payment Single with two children aged nine and 14 who is already working the required 30 hours a fortnight, earning and extra $500 would receive $139.77 less per fortnight, when transferred to Newstart."

This scenario would require the parent to find at least another five hours a week paid work just to get back to where they were before the changes. Of an extra $500 earned per fortnight, the sole parent will now clear only $321.23, before subtracting the extra costs costs of going to work — fares, clothes, and care, say $60 ($10 per day). So for her 30 hours paid work, she would take home under $10 per hour net. Giving up paid work and returning to benefits and unpaid care is likelier if the kids are sick or having issues.

The government’s own data shows similar proportions of employed sole parents on parenting payments to those already on Newstart. So why does the government still claim the shift will increase sole parent levels of employment? Where is their evidence? The original policy was introduced in 2007 and there is no evidence of any causal increase of sole parents in paid work over these years according to the ABS.

An interesting factor that the government fudges is that these parents have already been subject to the same job-seeking requirements as those on Newstart. Nothing much has changed in the job-seeking assistance already provided. They will have access to the same job-searching services those on parenting payments currently get — when their child turns six or seven. They may be offered more training but can no longer start a tertiary course. As their income drops, they will need to make sure they put aside money for phone calls, travel to interviews, and other costs of looking for work, rather than other costs.

To add to the problem, the changeover process is very clunky and potentially distressing. For example, one Indigenous mother with four children aged 8 to 12 and four children aged 13 to 16, had her money stopped after she had ignored a letter and failed to answer one call.

When the mother’s benefits were frozen, leaving her penniless and without money to send the children to school or feed them, she contacted the local family support agency. The social worker in charge of the case was very experienced, and undertook "significant negotiation with Centrelink at all levels". After four hours, with good cooperation from the local Centrelink office, the social worker was able to get a payment into the mother’s account late on Friday before the weekend. The case raises issues of what happens to similar "customers" who are not served by a strong local support service.

The agency sums up the changes for their clients:

"How can a single parent survive when put onto Newstart? How are local communities going to provide before and after school care? It is minimal in some of our shire communities, with no before school care in many of [them]. Children under eight years should not be left home alone."

Any explanations, Macklin, Shorten and Carr?

New Matilda is independent journalism at its finest. The site has been publishing intelligent coverage of Australian and international politics, media and culture since 2004.