Govt Releases Reform Proposals for Disability Employment Services

The federal government has released reform proposals for Australia’s disability employment services (DES) which are set to begin in 2018, calling for public feedback from people with disability, employment service providers and employers of people with disability.

The government has released a discussion paper, New Disability Employment Services From 2018, which outlines specific options for what a new model of DES could look like.

These areas include:

• improving participant choice and control over the services they receive
• generating greater competition between providers
• developing better incentives for providers to service all participants equally
• engaging employers to hire more people with disability.

The paper includes 20 discussion points with questions on what a new model of DES should look like and its design details.

The government said consultations would be supported by the establishment of a Disability Employment Reference Group, which would include representatives from peak bodies representing the interests of people with disability, employers and providers of disability employment services.

Minister for Social Services Christian Porter said potential options for reforms outlined in the discussion paper aimed to increase the number of people with disability finding and keeping a job.

“Only 53 per cent of people with disability are participating in work, compared with 83 per cent of people without disability,” Porter said.

“There are more than 180,000 people receiving DES services, but less than one-third of people who exit DES after a period of support are in work three months later and it is time to look at ways to reform the system to improve lives through greater levels of employment.”

In early 2015, the federal government established the Disability Employment Taskforce to undertake consultations with people with disability, their carers and families, disability advocates, DES providers, disability peak bodies and employers of people with disability to identify areas for reform.

Porter said the discussion paper builds on these findings with specific options aimed at improving employment outcomes for people with disability.

“The government invests around $800 million a year in the DES program and is seeking feedback on the proposals in this paper to inform the new model that will begin in March 2018,” he said.

The discussion paper said the proposed changes to the program were intended to create the circumstances in which more DES providers operate “at the level of current five-star performers to improve employment for people with disability”.

Some of the options being considered by the government include:

• increasing opportunities for successful providers to expand service provision to more DES participants by making it easier for new providers to enter the market and for existing providers to expand into new regions
• removing market share arrangements that prevent good providers from growing and prop up failing providers with guaranteed work
• introducing a new funding model with risk-adjusted outcome payments based on the likelihood of a DES participant achieving an employment outcome
• simplifying regulatory arrangements for providers by introducing a single contract for each provider
• reducing the number of Employment Service Areas so each covers a larger area and eliminating restrictions on participants so they can choose to attend a provider outside their area.

A shift towards more participant-directed service delivery is proposed for DES through:

• more choice for participants by relaxing restrictions on choosing a provider
• more say for participants over the services they receive, with funding following the participant when they choose to change provider
• better access to information to help participants choose, including more information about providers.

The paper said that underlying these changes would be a requirement for providers to accept any and all participants who choose to attend that provider.

“Generally, providers would not be able to refuse to take on a participant. This is aimed at ensuring providers do not seek to manage their caseload by only taking on job seekers that are relatively easy to place in work, while avoiding job seekers who are more difficult to place in work,” the paper said.

“It is expected there would be an exception to this for providers who specialise in assisting people with a particular kind of disability, or who face further barriers to work in addition to their disability. These providers would not be expected to take on people who are not from the group or groups in which they specialise, but would be expected to accept any and all DES participants who have the disability in which they specialise.”

Reforming fee payment is also part of the discussion.

“There is also no monitoring to determine what proportion of service fees are spent on addressing participant needs, nor any contractually mandated level of expenditure on participants. Their use is entirely at the discretion of the provider, which also needs to meet at least some of its own costs from the fees,” the paper said.

“Understandably, many participants are concerned about the lack of support from providers to help them in a way that the participant thinks will get them a job, such as funding a particular training course. DES providers are within their rights to decline to spend money according to a participant’s wishes, particularly if this money is unlikely to achieve an employment outcome.

“However, this experience can be demotivating for participants who may have a well-formed understanding of the jobs they want.”

The paper said one option considered to address this would be to introduce an element of individualised funding that gives participants more control to purchase what goods and services they think they need to get into the workforce.

“Under such an approach, when a participant starts in DES, a portion of their DES funding would be quarantined for their use in a separate account. The participant would receive information on their account, including how much money is in it and how to use it. Each participant would be able to determine how the quarantined funds are spent, so long as they are consistent with a set of guiding principles,” it said.

“In line with these principles, DES participants would be able to use the account to address their vocational and non-vocational barriers to employment. This could include safety clothing, like fluoro vests and steel capped boots, a driver’s or heavy truck license, petrol for their car or bus and train tickets so they can get to and from job interviews.”

As part of the suggested reform, money in the account could also be used to undertake training and skills development aimed at securing employment.

“Money in the account would not be intended to cover the normal day-to-day costs of participants, for example food and rent, nor is it to cover the normal costs of providers in delivering DES or the account,” the paper said.

Questions about this reform discussion process can be emailed to the department. Submissions close 5pm, 16 December 2016.