Disability Employment Services Reform 2018

‘The labour force participation rates for people with disability have remained stagnant for the past 20 years, at around 53 per cent, compared to 83 per cent for people without disability’ (DES Reform 2018: Industry Information Paper, June 2017).

In one sense the quote above says it all: the disability employment sector is no longer making progress and needs urgent reform. I’d go further and say that ‘stagnant’ is just a polite way of saying that the participation rates positively stink!

However, it would be a mistake to overlook the past 20 years.

We cannot dismiss or deny the clear data on what works and doesn’t work in disability employment services. In fact, these past 20 years have told us much of what we need to know: how stagnation occurs, and what facilitates progress and growth.

The Industry Information Paper proposes four key changes to ‘be implemented to improve DES performance’. Let’s look at each one.

1.    Improving choice and control for participants:

This has to be informed choice, based upon actual delivered results and not the hubris of providers. Job seekers should have easy access to plain-English information on number of jobs found, average hours worked, average pay received, average length of employment. Currently, there is way too much room for unsupported claims.

2.   Generating greater competition and contestability between providers:

Competition is important. However, the disability employment ‘industry’ is pretty cutthroat already. This can drive distortions in practice that are not in job seekers’ interests. For example, big subsidies devalue workers and create positions that are not sustainable in the long term.

3.   Improving financial incentives for providers through a new risk-adjusted funding model designed to reward providers commensurate to the difficulty in placing the participant into sustainable employment:

This is not necessary. My not-for-profit organisation generates a healthy surplus that we plough back into advertising, while many simply take the money as either profit for shareholders or to prop up other arms of the business. I have concerns about the methods by which ‘difficulty’ would be determined and the effect on job seekers.

4.   Indexing DES payments to maintain their real value:

Since payments have not changed for many years indexation is probably a necessary component of the next contract.

The real question to be asked is: will the reforms create meaningful change and improve service outcomes for people with disability? The jury is out.

- Martin Wren

My book The Ten Demandments - how to improve disability employment services is available here.