The times they are a-changin’

It’s not the 1970s any more. The most socially progressive reform governments can deliver today is to get every welfare recipient off welfare and into a real job, get every child to school every day and ensure that every Australian has the education and skills to thrive in the modern, global economy.

Speech to the Indigenous Economic Development Forum by Nyunggai Warren Mundine, Executive Chairman of the Australian Indigenous Chamber of Commerce 

30 October 2014

I’d like to thank the organisers, Akolade, for inviting me to speak this afternoon and to all of you who’ve come to listen to me. I’ve been asked to talk to you today about a national approach to targeting Indigenous employment with a focus on the Federal Government’s Indigenous employment strategies. And since it’s late in the afternoon after a busy 2 day agenda I thought I would start by taking you on a bit of a journey- from the late 1960s and early 1970s to today.

Through this narrative I hope to illustrate why we cannot have a national approach to targeting Indigenous employment without a national approach to welfare reform and a no-excuses approach to getting kids to school and educated. I also hope to illustrate why this approach needs to target all Australians, not just Indigenous Australians.

The author and cartoonist, Ashleigh Brilliant, came up with the following saying “I don’t have any solution, but I certainly admire the problem.”

This is a good way to describe government policy to fix Indigenous unemployment over 40 years. Of course, it’s not that governments haven’t had solutions – plenty of solutions have been implemented at great expense. It’s just that very few of them have worked.

And over the years whether or not a program works has had little correlation with whether or not it gets government funding. As a result, we’ve been admiring this particular problem for a very long time.

Today we talk about the problem of Indigenous unemployment and the gap between Indigenous and non-Indigenous employment participation. But up until the 1970s there wasn’t a really a gap at all.

Employment participation is one of the few areas where the position of Indigenous people was actually better 50 years ago. Before the 1970s almost all Indigenous people worked, many in primary industries in remote regions. The gap wasn’t in participation; it was in wages. Indigenous people worked for a pittance, for tea and damper or in return for being able to live on their own lands.

Big changes to economic participation by Indigenous people occurred in the late 1960s and early 1970s after changes to laws and government policy and the flow on effects from those.

First, Indigenous people started to receive equal pay. This happened through a combination of changes to laws and industrial decisions and it happened over a period of over a decade. The problem is that many Indigenous people lost their jobs soon after winning equal pay.

A well-known example was the Aboriginal stockmen at Wave Hill in the Kimberley winning equal pay in 1968. This was a significant win for them but the station owners promptly sacked them.

This happened all over the place. Indigenous people working in the pastoral and agricultural industries didn’t actually get equal pay. They lost their jobs and in many cases were kicked off their lands. The station owners lost their cheap source of labour and weren’t willing or able to pay them full wages. This meant Indigenous people were forced into the towns where they could not get work.

Even as late as 1982, Indigenous employees at the Queensland Department of Aboriginal and Islander Affairs were paid less than other people performing the same kinds of work. In August 1982 Queensland Cabinet under Joh Bjelke-Petersen approved payment of award wages to Indigenous employees in the Department. However, a week later the Queensland Treasurer approved mass retrenchments in the Department’s workforce, increased charges for community services and – disgracefully – the use of money from the Aboriginal Welfare Fund to pay Department wages.

The second thing started to happen in the late 1960s was that Indigenous people gained the right to receive government welfare. This meant that those who lost their jobs became full time welfare recipients living away from their traditional lands on the fringes of cities and towns, in the former missions or other settlements. There they received housing and other services and welfare payments without having to do anything in return.

Indigenous elders coined the expression “sit-down money” to describe this situation. These people had worked hard all their lives and found it demoralising and insulting to lose their jobs and to be deemed unable to make a valued contribution.

Now I don’t agree for one second that Indigenous people should have continued to be denied equal pay. I don’t subscribe to the view that paying Aboriginal people equal wages was an unreasonable burden on pastoralists or the practice was somehow justified because some pastoralists treated the Indigenous workers well and took care of them.

For many years the pastoral and agricultural industries profited off the back of unpaid or underpaid Indigenous labour. Indeed, many of those stations might have failed without Indigenous workers. When this kind of thing happens today we call it “modern slavery” and it has no place in our country.

But there was no attempt to manage the transition in a way that would keep Indigenous people in work. And I doubt that the union movement behind the fight for equal pay would have tolerated transitional or flexible arrangements anyway. There were pastoralists who genuinely couldn’t afford the sudden cost of paying Indigenous workers. Governments simply figured the welfare system would cushion the blow. It was another example of Indigenous people getting screwed over by a combination of ill-will, disregard, good intentions and circumstance.

The upshot is we now have whole Indigenous communities totally reliant on government assistance or government jobs with inter-generational welfare dependence and chronic long-term unemployment. The tenacity and drive that once characterised Indigenous people has been buried under the weight of government dependence and good intentions.

Today we talk about the need to transition Indigenous people from welfare to work. But we forget that 40 years ago socially progressive governments (both Labor and Liberal) transitioned Indigenous people – and many other Australians – from work to welfare.

All under the guise of enlightened, progressive policies.

I believe this is the main reason we as a nation have been furiously admiring this problem for so long. Solving the problem means confronting these mistakes. And the key mistake we need to confront is a welfare system that discourages working and sometimes even makes working unaffordable.

From time to time people approach me to talk about education or employment initiatives that have been successful in developing countries and ask for advice on how to roll out those initiatives in Australia’s Indigenous communities.

What I tell them is that program templates from developing countries may not work in Australia because Australia has a welfare system whereas most developing economies don’t.

One reason many emerging economies of the world have experienced rapid economic growth is because wages and the cost of living are low, there is limited, if any, welfare and a significant proportion of people live in extreme poverty – which is defined as living on $1.25 per day. All of these factors create intense – even desperate – drive. People have nothing to lose and everything to gain.

Not even the poorest people in Australia live anywhere near extreme poverty. Australia has a generous welfare safety net and is a modern developed nation.

The insidious reality is that the generosity of Australia’s welfare system and the absence of extreme poverty make it harder to put the poorest Australians on a path to prosperity. And the only way to do it is to reform the welfare system.

Any talk about welfare reform or moving people off welfare usually triggers an outcry from social progressives about unfairness and hurting the most vulnerable. Bill Shorten this year described this government’s modest welfare reforms as an “attack on welfare”. He claimed it “distorts the domestic destiny of hundreds of thousands of Australian families”.

But imagine we replace the word “welfare” with the word “poverty”. What if we talked about a government engaged in “poverty reform” or wanting to “move people out of poverty”? Would we describe this as unfair or as hurting the most vulnerable? Would we describe the government as mounting an “attack on poverty” or as “distorting the domestic destiny of Australian families”?

Long term welfare dependency is not virtuous. It is nothing more than state-sponsored poverty. And it’s the worst kind of poverty. It’s poverty with nothing to keep people busy. It’s poverty with no motivation. It’s poverty where a person’s natural instincts to survive and aspire are dampened. It’s poverty where people begin to think there is no other option. Long term welfare dependency sucks the life out of people.

Many Indigenous communities are examples of what happens when welfare is accepted as a long term way of life, with sometimes whole communities totally reliant on government assistance, inter-generational welfare dependence and chronic long-term unemployment.

The impact of this goes far beyond people’s immediate living conditions. We see worse health, higher suicide rates, greater abuse and violence, illiteracy and innumeracy and low to non-existent schooling.

This is by no means limited to Indigenous communities. It’s a growing problem amongst non-Indigenous Australians too. It is also a chronic problem in many European countries and in the UK. In many ways it’s the face of the modern Western welfare system.

People who oppose welfare reform often say we need to treat welfare-recipients with dignity. Of course we do. But allowing people to languish on welfare and dismissing them as being unable to work is not treating them with dignity. I support getting people off welfare because I want to see people lifted out of poverty. What can be more dignifying than that?

Welfare was created to help people who’ve fallen on hard times to get back on their feet. Not to keep people in hard times.

If you lose your job welfare is supposed to sustain you until you get a new job. Getting a new job is the important part – not the part to be ignored.

If you become disabled, welfare is supposed to sustain you until you can resume a functioning life which includes working. That may mean retraining in a different line of work. I find it bizarre that we have laws against disability discrimination on the one hand but accept people living long term on a disability pension on the other. Let’s stop disability discrimination by helping people get off the disability pension and into a job.

There are over 800,000 people in Australia on the Disability Support Payment. Eight hundred thousand people. That’s 1 adult for every 28 men, women and children. That’s 800,000 Australians with a disability who unable to work, or be retrained for work, for at least 15 hours a week because of their impairment.

If 1 in 28 people can’t work for as few as 15 hours per week because of an impairment, then Australia either has an illness and injury epidemic of massive proportions or a huge problem of disability discrimination in the workforce. Or perhaps we’re not trying hard enough to get people off the disability pension.

Most people with disabilities can work. In fact, they make great employees. People with disabilities have lower levels of absenteeism and use less sick leave, have low employee turnover, high loyalty and retention and comparable productivity to able-bodied employees.

As a young man I worked in the equivalent of Centrelink. One of my colleagues was a quadriplegic. A man came in with an appointment and was trying to explain why he couldn’t be expected to look for a job because he had a bad back. His case worker pointed over to our colleague in his wheelchair and said “See that man? He has a bad back.”

There will always be exceptions in the case of disability pensions where people need ongoing and long term assistance. But we should not let the exceptions dictate the rule. Deal with the exceptions as exceptions. The default position for people on the disability pension should be to move from welfare to work as soon as possible.

So when we talk about strategies for dealing with Indigenous unemployment – or any long term unemployment for that matter – we need to talk about welfare reform. Unemployment and long term welfare dependency are two sides of the same coin.

The Federal Government knows this. And that’s why its employment strategy is tied to its welfare reform strategy. We’ve already seen initial changes like those in the 2014 Budget. Over the longer term, the Forrest Review and the Final Report on the Review of Australia’s Welfare System headed by Patrick McClure AO will shape the detailed policies and reform.

The core principle underpinning all of these measures is that all Australians should be working, studying or training unless they have no capacity to do so.

This is a very simple and sound philosophy and one which ordinary, working Australians overwhelmingly understand and support. It’s how my parents brought me up. However, it raises the ire of the socially progressive Left, the bleeding hearts, large sections of the media and others who work in what I think of as the misery industry – those who live off the ongoing existence of people who need help. To these groups everything is complex and all solutions are unfair and/or destined to fail.

Take for example the changes touted this week to the Remote Jobs & Communities Program – or RJCP – which operates in 60 remote Indigenous communities. The RJCP was introduced by the previous government to replace a program known as the Community Development Employment Program – or CDEP.

CDEP was a glorified work for the dole scheme. It was introduced to replace unemployment benefits for Indigenous Australians living in remote communities. The intention of CDEP was for community members to participate in work activities and training by doing things to develop the community and culture in return for their welfare benefits which were also “topped up”. However, participants had to work for only a couple of days a week and many of the activities undertaken were of no real value or had no expectation of a real outcome.

I was not a supporter of CDEP. It masked the true levels of unemployment in remote communities, entrenched the idea that people could get something for nothing and fostered the pretence that people were doing real work when they weren’t. CDEP didn’t succeed in getting people from welfare to work. Actually CDEP entrenched welfare dependence.

The previous Labor Government replaced CDEP with RJCP under which a single provider is contracted in each region to help people into jobs and build stronger communities. RJCP was intended to provide a more integrated and flexible approach to employment and participation services and is supposed to engage Indigenous people in structured activities which are similar to work.

The Abbott Government’s view is that RJCP has failed. Yesterday, The Australian newspaper reported that a plan is being taken to Cabinet to bring in stricter work for the dole conditions for people who participate in the RJCP.

Under the changes as foreshadowed by The Australian, participants would need to engage in work-like activities for 50 hours per fortnight and job agencies would be responsible for creating work-for-the-dole programs for the unemployed people they manage. The idea is to get Indigenous people who have been dependent on welfare, in some cases all their lives, used to the concept of work, and things like getting up every day, getting ready and being on time.

Cue the cries of protest. I was surprised to hear Jobs Australia, the peak group representing non-profit job agencies, coming out as one of the critics. Its Chief Executive, David Thompson, immediately attacked the plan to require 50 hours a fortnight in work for the dole. The reasoning? It will be expensive and will not generate real and ongoing remote area jobs. Thompson said:

“Anyone familiar with employment services in remote Australia knows that it’s complex, there are no easy answers, no one-size fits all and no magic bullets. We need to have a better and closer look at the reasons for the current levels of employment outcomes being achieved — by talking with providers and communities — and to adjust the RJCP to tune and improve its performance. We’ve had over 30 years of trying all sorts of other solutions which didn’t work and this one — RJCP — needs to be given the chance it, and people in remote communities, need and deserve”.

This is an example of admiring the problem.

As it happens I am a person who’s familiar with employment services in remote Australia. And I don’t believe it’s all very complex. I believe there are some easy answers. People just need to have the courage to implement them.

For starters, we need to get away from this myth that there are no jobs in remote Indigenous communities. There are jobs to be done in remote communities like everywhere else. Teachers. Police. Health Services. Construction and repairs. Cleaning. Mechanical work. Waste management. The local store. There are community pools, airstrips, art centres, satellite dishes, generators, sewerage treatment plants, water tanks, air conditioners, cars, houses, roads and other infrastructure. There are also jobs in industries such as tourism, mining and agriculture and some of these jobs are currently being done by backpackers on short term visas.

If every remote Indigenous community did a stocktake of all the jobs that exist in the community and the other work that needs to be done then they may be surprised at how many jobs exist in remote communities. This is what the job agencies servicing those communities should be doing, instead of claiming there are no jobs. If there are no jobs then what is a job agency being paid to do there in the first place? The job agency should identify all the jobs that exist, who is doing them now and come up with a plan for how to get locals into those jobs.

It’s true that in many cases there aren’t enough jobs. But before you get to that problem you have a more pressing problem – which is that the jobs that do exist are being done by people from outside the community, often at huge expense flying in from far away. Or the work is simply not done at all – public buildings go uncleaned and unmaintained, rubbish and waste lies around uncollected, broken down cars are left to rust rather than being maintained and repaired.

If you started by filling the jobs that do exist with people from the community then you’d have made a huge start to building a real economy in that community.

So what is stopping locals from filling jobs in remote Indigenous communities? The number one problem is that people aren’t educated and job ready. Many people in those communities are illiterate or innumerate, kids grow up not attending school, and families with generations of sit-down money have developed an entrenched habit of not working.

There is only one solution for this. Get people job-ready and get them into work. Real work – not pretend jobs. That is what the job agencies and Government Engagement Coordinators in remote communities are supposed to be doing. Frankly, I think a lot of them aren’t up to the task.

* * *

When it comes to Indigenous employment we need to remember that a majority of Indigenous Australians live in or near major cities and large regional centres, not in remote areas. It’s true that Indigenous Australians represent a much higher percentage of remote populations but those areas have low populations to begin with.

Job-readiness is a problem for the long term unemployed in the large population areas too – for both Indigenous and non-Indigenous people. And those areas have plenty of jobs.

Job seekers and the unemployed are generally categorised into four categories. Category 1 is for the people like you and me who are skilled and job-ready and therefore easy to place without too much effort. Those in Category 4 are generally unskilled as well as having multiple, significant barriers to work entry – such as a lack of education, a significant disability, illiteracy, drug or alcohol problems, a criminal record, homelessness and/or family violence. People in Categories 3 and 4 require the most effort and investment up front to get them into work and staying in work.

Indigenous people are overrepresented in Categories 3 and 4. But employers are mostly used to hiring people in Categories 1 or 2. Those employers who are committed to Indigenous employment programs and who set aside jobs for Indigenous people can be ill-prepared for the challenge of hiring from Categories 3 and 4. Alternatively, they end up meeting their Indigenous hiring targets by hiring Indigenous people from Categories 1 and 2. These people would have found work without targets or assistance so this doesn’t help close the gap.

Employers committed to Indigenous employment need to go in with their eyes wide open. It does take effort, investment and a change in thinking initially. But the outcomes are incredibly rewarding for both the employer and the candidates. To succeed employers should work with the experts using proven models that work.

One example of a model that works is the Vocational Training and Education Centre – or VTEC – model which is based on the approach developed by Fortescue. VTECs have now been adopted by the Federal Government as the cornerstone of its Indigenous employment strategy. VTECs target people in Categories 3 and 4 and train candidates for a guaranteed job. Participants also receive intensive case management that addresses all the barriers to employment in each case-managed by an expert in dealing with those issues. Experience shows that once someone has stayed in a job for the first 6 months then they’ll most likely stay in the workforce for life. Up front effort is needed but it pays off in the end.

GenerationOne, which is a partner of this event and of which I used to be the CEO, works with employers to fill the more than 60,000 guaranteed jobs which Australian employers have committed for Indigenous Australians. GenerationOne was founded by Fortescue Chairman, Andrew Forrest and works according to the same principles as VTECs – training for a guaranteed job with intensive and holistic case management.

When it comes to remote Australia we need to think about it more expansively. The VTEC model is relevant for the large industries operating in remote areas such as mining and agriculture or for corporates like Banks that have a footprint in these areas. However, those industries and employers alone aren’t the solution to remote employment.

Nearly three quarters of people in remote Australia – black, white or brindle – are contractors, operating small businesses, partnerships or micro-enterprises. Job agencies and others charged with getting people into work need to be able to assist people to become self-employed. That means they need to be able to assist people to do things like get an ABN and handle GST paperwork and get skills in business management and accounting.

Of course, the most important factor of all in Indigenous employment strategies is education. Without education, people aren’t capable of doing the jobs that already exist. When people say “there are no jobs in remote communities” what they are really saying is “there are no job-ready people in remote communities”. If you ever wonder why there are large groups of unemployed people in urban centres but at the same time employers complaining they can’t find workers it’s because the unemployed people aren’t job-ready for the available jobs. Look below the surface and you’ll find communities with low school attendance, lack of education, and high levels of illiteracy and innumeracy.

When children go through the first 16 years of their life without an effective education you end up with adults who are unemployed despite there being available work. That can only change by ensuring that all children go to school every day and that they get a proper education when they get there.

This is obviously a big priority in the Indigenous communities where the schooling resembles the education system of centuries ago – voluntary, piecemeal and ineffective. The Federal Government has made a big push on school attendance this year and that is to be applauded. It angers me that initiatives like the Remote School Attendance Strategy are met with cynicism and criticism from those people who say everything is complex and all solutions are unfair and/or destined to fail. Governments need to have the courage and determination to push past this.

Long term unemployment, chronic welfare dependence and lack of education aren’t limited to remote communities or to Indigenous people. These problems exist even in suburban Sydney. And it may surprise you to hear that half of all people living in Tasmania aged 15 to 74 are functionally illiterate and more than half are functionally innumerate. There are communities in Tasmania where you see problems of high truancy and children unable to read or write that sound very similar to the problems in remote Indigenous communities.

We’re dealing with a social problem, not a geographical or cultural one.

That’s why welfare reform and tackling education failures need to be across the board – not just for Indigenous people or Indigenous communities. The Forrest Review recommended that cashless welfare apply to everyone, Indigenous and non-Indigenous alike. This is the right approach. We should not single out Indigenous people in welfare and income management.

The Prime Minister’s Indigenous Advisory Council, which I chair, has consistently recommended that all initiatives to improve Indigenous employment and education should apply to everyone – be they cashless welfare, work for the dole, school attendance strategies, welfare quarantining for non-attendance at school and anything else.

* * *

In the past few weeks in the wake of Gough Whitlam’s death, a lot of people have looked misty-eyed back to the 1970s at the great socially progressive reforms intended to make us a better nation. It’s not the 1970s any more. The world has changed and is continuing to change at an ever increasing pace. We need every Australian working and contributing to society at their full capacity. We need a highly skilled, technical, educated and mobile workforce.

Those who defend the modern welfare system which entrenches people in poverty; those who are nostalgic about the enlightened policies of the past; those who attack solutions for getting kids to school or moving people from welfare to work as being complex, unfair and/or destined to fail – those people are not progressive. They are living in the past.

They should heed the words of another 1970s icon:

“Your old road is rapidly agin’.
Please get out of the new one
If you can’t lend your hand
For the times they are a-changin’.”

The most socially progressive reform that governments can deliver today is to get every welfare recipient off welfare and into a real job, to get every child to school every day and to ensure that every Australian has the education and skills to thrive in the modern, global economy.

Let’s stop admiring the problems and get on with the solutions.


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