Ending Poverty for People with Disability – an appropriate use of Disability Employment Services
42% of those on Disability Support Pension live below the poverty line – in Australia 827,000 people receive the DSP – Therefore 347,340 people who have a disability live in poverty – about 1 person in 60.
What to do?
Raising the pension is an obvious answer but the truth is that we simply can’t afford that Australia has a shrinking tax base and as we are all getting older creating a burgeoning pension cost.
That doesn't mean nothing can be done. Just as pensioners are being required to self-fund more and more of their retirement so it makes sense for people who have a disability to be asked to share (wherever possible) a fairer share of their own financial needs.
The great news is that many want to, and many can. In fact, many people that receive the Disability Support Pension have chosen to either enter or re-enter the workforce and take up full time work, ending any requirement for welfare.
Why don’t more people do so?
It is my belief that under the present funding and contractual requirements for services supposedly set up to achieve just this outcome; some perverse disincentives have been created that actually act against this desirable progression.
Here is a simple example:
Each employment ‘outcome’ attracts a rewards from the funding body.
The financial reward is set at 2 levels and each placement effects the performance management tool used to indicate quality – “Star Ratings”
Individual employment and program survival is linked to performance in the Star Ratings.
No distinction is made between levels of employment and, for a person in receipt of the DSP, both financial and Star Rating reward is identical for an 8 or a 38 hour a week employment ‘outcome’.
Therefore a 40 hour a week position (this for my simple math mind) could be broken down to 5 x 8 hours a week and the service provider could, should they so wish lower the risks associated with job loss (negative in the Star Ratings), receive 5 times the financial reward and 5 times the positive effect of the Star Rating simply by breaking up a job.
In fact, assuming the highest funding level, the service provider could, by way of employment subsidy (which would itself be further supplemented by the Commonwealth) completely cover the cost of employment to the nominal employer and, at a rate of say $20ph, end up about $100k in the black at the end of 12 months. Repeat that over and over and not only could you make (and export) a lot of taxpayers’ money you would receive very favourable Star Ratings.
When I first pointed this out (I think towards the end of 2005) I was told, “I think we can rely upon the integrity of service providers” – well you might have been able to but 46 such providers went under in the last business allocation, victims of their own dedication to their clients and our community.
That is threatened again and in what is the most reprehensible travesty absolutely nothing has been done to effectively end malpractice and more importantly, orient programs toward ending poverty through the maximum use of the employability of people with disability.
The fact is that this approach may lower the participation rate (I suspect it won’t by much, because services will be genuinely encouraged to better engage with employers and the labour market) but the trade off will be significant reduction in the cost of benefit.
Keep the “Star Ratings” but tie them to dollars earned, hours worked, and time in employment.
Do that and watch the poverty numbers improve.
Seemingly complex problems don’t always need complex solutions.
Want to know more? – Skype me,
Want to make a change? – get in touch with your political representatives and tell them that for poverty to be addressed there must be change while some talent still remains from what was once a world class disability employment service.
Would you like a face-to-face meeting with Martin via Skype? Click the button below to make an appointment
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