Indigenous Employment Conference
- Assistant Minister for Employment
It is a pleasure to be here today to speak with you about the Australian Government’s plans to help more Indigenous Australians into work and towards a meaningful and sustained career.
As the Assistant Minister for Employment, I have a keen interest in making sure all Australians receive the help they need to find and keep a job.
As some of you may know, my responsibilities include employment services in metropolitan and regional Australia.
And my colleague – the Minister for Indigenous Affairs, Nigel Scullion – has responsibility for employment services in remote communities.
Together, we have a strong commitment to helping Indigenous job seekers - no matter where they live - to move into employment and reap the personal and financial benefits of work.
This is very important and challenging work and one which requires sustained attention and effort.
Earlier this year the Prime Minister tabled the 2015 Closing the Gap report in Parliament.
The latest Closing the Gap report shows that there is still much work to do on halving the gap in employment outcomes between Indigenous and non-Indigenous Australians by 2018.
As I am sure you all know, Indigenous unemployment far exceeds the unemployment rate for the general population and the participation rate of Indigenous Australians is also lower.
As part of our Indigenous Advancement Strategy, the Australian Government is committed to helping more adults into work because as the Prime Minister has said – ‘it is hard to live well without a job’.
This morning I would like to outline the Australian Government’s actions to help more Indigenous Australians into work.
And I would also like to provide you with an update on the new employment services model – jobactive – that will replace Jobs Services Australia from 1 July 2015.
And to briefly outline the measures in the Budget last week to help job seekers – especially young job seekers.
Overview of Indigenous employment reforms
Ladies and gentlemen, the Government understands that the best way to help Indigenous job seekers is to grow a strong economy.
Because a strong economy generates business confidence - which in turn - creates jobs.
However, Government has an important role to play in creating the right settings for businesses to thrive and for helping job seekers to take up opportunities.
That is why the Government has committed to work with the private sector through the Employment Parity Initiative to increase Indigenous employment.
Under this initiative, the Government will partner with Australia’s largest employers to help increase their average Indigenous employment rate to at least 3 per cent of their workforces by 2020.
This is equivalent to an additional 20,000 Indigenous Australians in work.
I am pleased to see how many larger corporations are taking Indigenous employment seriously, including those involved with this conference.
There have been some impressive sign-ups to this programme already including the Accor Hotel Group and Compass Group Australia.
Simon McGrath from Accor recently said that:
“as an employer of over 10,000 hospitality staff nationally we are focused on supercharging Indigenous employment from 318 employees currently and generating 1,000 job opportunities by 2018...”
And while we are talking about business, I am delighted to see some of the initiatives coming directly from the private sector.
The Australian Chamber of Commerce and Industry has developed the Employ Outside the Box guide which outlines how to recruit, employ and retain Indigenous workers.
And I was excited to see the First Australians Chamber of Commerce and Industry launched recently to drive more opportunities for Indigenous business.
I know from my own experiences running a small business in Coffs Harbour - that these types of groups can be very effective in sharing crucial information, building networks and raising awareness among potential supporters.
The new chamber has the potential to be a very important bridge with non-Indigenous business leaders.
The Government is also focused on making sure more Indigenous Australians in remote communities are in work.
The Government is reforming the Remote Jobs and Communities Programme to deliver better opportunities for remote job seekers and foster stronger outcomes in remote Australia.
Providers can address the unique conditions of each locality and there is more flexibility and less red tape.
Our improvements include an incentive of $7,500 for each remote job seeker employed and retained for at least 26 weeks.
This will start on 1 July 2015 to stimulate job creation and the use of local labour.
In addition to these reforms - Vocational Training and Employment Centres - or VTECS - are connecting Indigenous job seekers with guaranteed jobs and helping to prepare them for long-term employment.
We have invested $45 million for VTECs to train, place and support Indigenous Australians into specific, ongoing jobs.
I am told that already 29 VTECs are supporting more than 5,520 Indigenous Australians into jobs.
In addition to these specific services, the Australian Government also has a pivotal role as the purchaser of public goods and services and as a large employer.
One of the ways the Australian Government is demonstrating our commitment to Indigenous employment is through our new public sector and procurement targets announced in March 2015.
Departments and agencies will be held accountable for meeting those targets and to report on their progress.
We have set the Commonwealth public sector a target of increasing its Indigenous workforce to 3 per cent by 2018, which means an extra 7,500 people.
We have also set a target of having 3 per cent of Commonwealth procurement contracts with Indigenous suppliers by 2020.
At the moment Indigenous businesses are being contracted to a very small amount of Government business. This is not good enough.
Achieving this target will amount to significant growth from the current $6.2 million in business to around $135 million each year – on an average contract value of $90,000.
There is a potential double benefit here because Indigenous businesses are more likely to employ Aboriginal and Torres Strait Islander people.
And, as more contracts go to Indigenous businesses, it is likely that more employment opportunities will open up for Indigenous people.
Ladies and gentleman, on July 1 2015 the new jobactive employment service will replace the current Job Services Australia arrangements.
Many people are surprised to learn how many Indigenous Australians receive support through mainstream employment services in addition to RJCP.
As at 31 March 2015, there were around 78,000 Indigenous job seekers on the Job Services Australia caseload.
That is around 9 per cent of the total caseload.
Of these - 65 per cent were in Streams 3 and 4 - the most disadvantaged streams in Job Services Australia - compared to 38 per cent of all job seekers.
So I am very conscious of the need to ensure jobactive services are responsive to the needs of Indigenous job seekers.
I would like to run through the broad features of the new jobactive model before I talk about the specific features that will support Indigenous job seekers and their employers.
At the broad level, the new model is designed to lift the standard of services delivered to all job seekers and employers.
The key point of difference in the new jobactive model is the stronger focus on payment for results.
The Government is all about helping people to find and keep a job.
Fees and payments to providers have been restructured to promote a stronger focus on meeting the needs of employers.
We have introduced new outcome payments at 4, 12 and 26 weeks to ensure providers are encouraging job seekers to take up all job opportunities – as the research shows that people are more likely to move into a job if they have some recent work experience.
We have also tightened the rules around training to ensure that job seekers are not being sent to training for training’s sake as is currently the case.
There are new wage subsidies that will encourage employers to hire, train and retain job seekers.
These include subsidies for young job seekers under 30 years of age, older job seekers over fifty years, parents, the long term unemployed and Indigenous job seekers.
The mutual obligation framework has been strengthened to ensure job seekers remain active and engaged while looking for work
Most job seekers will be required to look for 20 jobs per month but there will be flexibility for jobactive providers to tailor the requirements according to individual circumstances and local labour market conditions.
Job seekers will be encouraged to look outside of their immediate area for work and take advantage of the Government’s new Relocation Assistance to Take Up a Job funding.
Work for the Dole will be mandatory for most job seekers under 50 years of age unless they are working part time; or in limited cases undertaking training for a specific job that is in demand in their local area; or have a partial work capacity or are a principal carer parent.
Work for the Dole will be a mix of individual and group activities in community–based organisations such as local councils or not for profit organisations.
A network of Work for the Dole Coordinators will be contracted in each employment region to source Work for the Dole places and work with host organisations and employment service providers.
The Government has also sought to place the employment services sector onto a more sustainable footing.
There is also a suite of changes to improve the operating environment for providers so they can deliver better outcomes on the ground.
The new employment services contract will be for five years instead of the three that has been offered in the past and larger employment regions have been created to produce economies of scale.
There will be less prescription and red-tape. While there will be minimum service standards, providers will be contracted to deliver the actual services they included in their tender.
A mid-contract price adjustment will be paid to ensure employment providers can deliver the service for the life of the contract.
And a new regional loading for providers in selected regions will be introduced in recognition that local labour market conditions vary across Australia.
Indigenous outcomes in jobactive
In addition to these changes which are designed to lift the standard of service for all job seekers and employers, there are specific changes to help Indigenous job seekers.
For the first time, there will be Indigenous Outcome Targets, to ensure jobactive providers are achieving job outcomes for Indigenous job seekers at the same rate as other job seekers in their region.
These targets are a standalone measure of performance, and organisations will be held to account for meeting them.
Poor performance in meeting the targets may have an impact on how the Government approves future business.
In addition, the performance framework – the “star ratings’ model” - includes a 10 per cent weighting for 26 week outcomes for Indigenous job seekers.
These changes are deliberate so as to drive stronger employment outcomes for Indigenous Australians in jobactive so that we are making progress against our Closing the Gap objectives.
Growing Jobs and Small Business package
In addition to these reforms, the Growing Jobs and Small Business Package in last week’s Budget will help many Indigenous job seekers around the country.
At $5.5 billion it is the biggest small business package in our nation's history.
The package builds on what we have already achieved for small businesses and will help small businesses to invest more, grow more, and employ more.
It will also assist unemployed people, particularly young people, to access the skills and experience they need to become job-ready.
The Jobs Package has a strong focus on youth.
As many of you know, youth unemployment is unacceptably high.
At 13.6 per cent it is more than double the national rate of 6.2 per cent.
As a Government we are not prepared to let young people slip into long term unemployment.
That’s why this jobs package is about helping young people to improve their work readiness so as to improve their chances of getting a job.
One of the common complaints I hear from young job seekers is that they can’t get a job because they don’t have any work experience – yet they are not given a chance to get some experience.
It is a vicious catch-22 for many young people.
That is why we have established the National Work Experience programme which allows job seekers to volunteer for up to 25 hours per week for up to four weeks in business to get some experience.
During this time job seekers will continue to receive their income support as well as getting a supplement.
This builds on existing work experience arrangements which have good outcomes, but are underused.
The National Work Experience programme gives job seekers the opportunity to learn new skills in a work setting and to demonstrate to a future employer that they are keen and willing to work.
But the Government doesn’t want job seekers just getting work experience - we want job seekers getting jobs.
That’s why we have expanded eligibility for wage subsidies to more job seekers and made it easier for employers to access wage subsidies.
Eligible young job seekers, parents and Indigenous job seekers will attract a wage subsidy of up to $6,500 after six months in jobactive.
Eligible job seekers over fifty years of age will attract a wage subsidy of up to $10,000 after six months on income support and employers will be able to receive this payment over 12 months – down from 24 months now.
Employers will also be able to access wage subsidies from the day the job seeker starts in the job and can be paid on fortnightly basis if needed.
These changes are designed to help employers with the upfront costs of hiring and training new staff and to open more doors for job seekers.
The Jobs Package also included new measures to help young people most at risk of long term unemployment.
The Transition to Work programme will help young people aged 15 to 21 in targeted regions with intensive pre-employment support.
This programme will be delivered by community based organisations with a track record of helping youth.
There is also funding of $106 million for innovative approaches to helping young people most at risk of long-term welfare dependency such as:
those living in areas of entrenched disadvantage;
young people with a mental illness;
and young refugees and migrants.
The Jobs and Small Business Package will provide a suite of new services to help job seekers improve their chances of finding a job and stronger incentives for employers to create new opportunities for job seekers.
Ladies and gentlemen, the Australian Government is committed to helping Indigenous Australians into work no matter where they live.
The Australian Government has confirmed its commitment to Closing the Gap – and as the Assistant Minister for Employment – I fully share this commitment.
The Government has set new targets for jobactive providers with regard to Indigenous employment – and will hold them to account for their results.
jobactive has an important role to play in delivering real and positive change for Indigenous people.
My door is open to you all as we move forward on ways to continually improve jobactive for the benefit of Indigenous Australians.
Thank you all for committing your time to this important goal and I wish you well with your conference.