The worst of American ideas has somehow crept into the Australian labour landscape, audit's perniciously worked its way up to Canberra to the point where they've turned the utterly useless 'Work-for-the-Dole' scheme in to an 'PaTH Internship' programme. This lousy idea is in fact the centrepiece of Malcolm Turnbull's re-election campaign.
It really is a nutty programme because it pays employers $1000 to have an intern around, and then pays the same employe $10,000 when they hire that sam intern. As part of an incentive for the long term unemployed who will become the said intern, their $263 per week money will rise to a mere $364 a week in exchange for 25hours a week of work. This is why you're seeing the figure $4 an hour.
Now it turns out the legal advice is that this can't actually be legal given our laws.
The $840 million program forms a central plank of the Turnbull government's jobs and growth package.It features generous $1000 incentive payments to employers in the intern phase and $10,000 employer payments in the hire phase, raising concerns of a perverse incentive for employers to churn through interns.
But if the legal advice is correct, the program is not legally sound in its current form and would necessitate changes to the Fair Work Act, or have its subsidies increased to meet minimum wage rates, adding hundreds of millions to its cost.
Illustration: Ron Tandberg
While concerns of exploitation and systemic abuse have been raised by unions and the group Interns Australia, the advice from the firm Maurice Blackburn is the first authoritative argument that it is technically illegal.
The ACTU argues it "would require new legislation to legalise a second-class category of $4-per-hour workers and remove those employees' basic rights under the Fair Work Act".
It says fixing the problem to bring interns's pay up to the legal minimum would "blow out" the cost of the PaTH program by $478 million.
It's interesting how the Federal government can't seem to do basic maths in figuring out how the incentives line up.
- If you're an unethical company, you employ the intern for the required X weeks of free labour and cash in the $1000.
- The free labour at 25hours is let's say worth the minimum $20.00/hr to round it off = 500/week x12weeks = $6000.
- Then you employ the intern and collect the $10,000.
- If you then sack the person within the first 6months of employment, preferably the first month, there's no recourse for unfair dismissal by the employee so at worst you're going to pay a month of low wages so subtract $2500 from the $17000= $15000 free money from the government.
In exchange for gifting companies $15000, the unemployed person who goes through the 12week internship and then 1month of employment then gets the $2500+12 weeks of 100 dollars =$3700 (minus PAYG on the $2500). If you consider how much more employable the unemployed person is at the end of the cycle - not much - then it's eminently clear that the system favours the unethical employer 4times more than the intern/worker ... Unless of course this is exactly what the Coalition government wants to do - gift free money to companies under the guise of trying to help the unemployed in which case I don't think we've ever seen a conservative government so cynical.
If there really is $12200 cash to throw around for every unemployed person, there must be a better way of spending it than that. For a start they could hire the same person for 3months directly and give them a government job with real government job experience.
The Dishonesty Of Governments About Employment
I just want to go over that last bit again. The Liberals and Nationals always say they want smaller government, less taxation. They say this because it appeals to the notion that governments don't do anything well and so any money given to them would be less inefficient in the economy. This construction masks a greater greed motive whereby if a government business or venture actually is any good, they're the same people who want that same service privatised - and of course that means ripping off form the government the bits that actually work and then leaving behind the bits that are less efficient and then blaming the leftover bits for being inefficient. This construction only serves those who construct the argument - a true hallmark of an ideologically loads argument.
The government can - and probably should - employ more people to do more things. Especially in the context where aggregate demand is flagging so badly and the RBA is reaching near the Zero-bound, which means the private sector can't seem to generate the jobs or profits to power aggregate demand. Governments of both ALP and LNP hues have overseen growing globalisation which has resulted in an overall growth at the expense of giving up secondary industry. You won't hear it from the ALP but basically globalisation has worked its magic in reducing unionised jobs in this country, so it's not like they aren't party to the problem of structural unemployment.
What is really galling about all this is that unemployment isn't a uniform 5.7% across the country. There are pockets where plenty of people are unemployed, and int those places the government runs these work-for-the-dole schemes far less whole-heartedly than they do in major cities and their suburbs. The administration of Centrelink in such places is effectively a work-for-the-dole scheme; that is to say, working as a Centrelink officer in those regions is an elaborate work-for-the-dole scheme given that there isn work outside of that job.
At the centre of all this is the grand delusion that everybody has to be working in a way that maximises productivity and profitability all the time. Yet the physical reality of space and materials and capital and people demonstrate this is patently impossible.
I know. It's a weird thing to say but it needs to be said that how we conceive of work in the industrial world was driven by the development of capitalism. The history of labour movements and unions and such come out of the need to humanise this demand and many countries on the planet have found different balancing points to do with what work is in our waking hours. All this stuff of commuting and schlepping and touring and driving and desk-jockeying and lifting and filing and doing stuff for your pay cheque, came about out of industrialisation. And as we head increasingly into a post-industrialised world, it's well worth asking if this schema of 'work', and the 'work ethic' that bolsters the entire culture of it, is sustainable or frankly, meaningful.
And if the employed people situation looks somewhat untenable, then the ranks of the unemployed look even less tenable.
We can't distribute work evenly now.
We can't grow work readily now without significantly high education and training - which costs money. Money which the Coalition Government doesn't exactly want to spend.
We can't encourage employers to hire people they don't need without gifting them money - which is in fact simply less effective than giving that money to the people that need it.
Not to mention the obvious fact that we can't just shoot/exterminate unemployed people.
The thing is, it's the government's job to think about this stuff and figure out what to do. The fact that our election is mired in the same kinds of conversations we've had since at least 2004 suggests we've not advanced in the least bit while the world has moved in to a more precarious period, and we do need to start thinking about all these things. Both our major parties really need to reassess what the hell we're talking about when we say 'work' and how that 'work' is being rewarded.
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