Some of Australia’s outsourced employment service providers have effectively suspended the Centrelink payments of more than 90% of the jobseekers on their books, reports The Guardian. Jobseekers have their payments suspended as part of the mutual obligations regime, which is meant to ensure jobseekers are actively looking and preparing for work. If they do not fulfil activities such as job applications, training courses, interviews and meetings with job providers, their Centrelink payments are suspended.

As the government mulls the future of the employment services system after a critical parliamentary review, figures showed job agencies in the federal government’s flagship Workforce Australia program applied 282,830 payment suspensions in the final three months of 2023 across a total cohort of 622,315 jobseekers. While average rate of suspensions per jobseeker for all providers was 45%, the data shows some smaller providers, particularly those catering for Indigenous jobseekers, are applying payment suspensions at an alarming rate. Among the five job agencies with the highest per capita rate of payment suspensions, three are specialist providers for Indigenous jobseekers. The Department of Employment and Workplace Relations (Dewr) acknowledged clients who were homeless, ex-offenders or from First Nations (indigenous) communities were more likely to be affected by payment suspensions.

The main reasons for the payment suspensions were not attending a provider appointment (168,010 suspensions) followed by failing to meet a job search target (109,850 suspensions).

The Australian Unemployed Workers Union’s Jeremy Poxon said the system was full of errors. “Suspensions happen for all sorts of random reasons – because of tech glitches, admin error because participants simply can’t get their providers on the phone,” Poxon said.

A Dewr spokesperson said the department recognised there was “concern” over the rate of payment suspensions. The spokesperson said having mutual obligations and a compliance mechanism to check jobseekers are meeting them was an important part of people finding work. They said the department was working with specialist providers to make sure those at risk were placed in employment.