What you need to know about jobseekers’ insurance
The Government’s jobseekers insurance scheme will cost $12.8 billion to fund, which is higher than the $12 billion in the previous year, and will increase costs for the states.
The cost to the Commonwealth Treasury is forecast to be $3.3 billion.
The Government said it would be a significant increase on the $3 billion that the states paid in last year’s Budget.
It is expected to increase the cost of unemployment insurance by around 30 per cent over the next three years.
In a statement, the Commonwealth Government said that its “long-term economic plan” included a return to more targeted unemployment insurance schemes for some jobseekers.
“The Coalition Government is committed to providing a fair, effective and sustainable unemployment insurance scheme that meets the needs of jobseekers,” the statement said.
It added that the Government was “continuing to develop a broader package of policies and services for jobseekers”.
The Jobseekers’ Compensation Authority is a state government agency.
It was created in 2010 to administer the State Unemployment Insurance scheme and its compensation to jobseekers, the most basic form of benefit.
Its chief executive, Michael O’Brien, said the organisation was “extremely disappointed” with the Government’s decision to cancel the scheme.
“It is not fair for jobseeker families to be subsidised by the Commonwealth, and I think that is a fair assessment,” he said.
Mr O’Brian said the scheme was “not the most efficient way of delivering our national unemployment insurance, but we do have the technology to do it”.
The Government has said it will scrap the Jobseekers Compensation Authority and replace it with a new body called the Workplace Employment Security Agency (WESA).
It will be based in Sydney, and is expected within weeks to announce the details of the new body.
The government has also indicated that it will not be renewing the existing Jobseekers Insurance Scheme for the next four years, which was set to run from April 2018 to March 2021.
Mr Newman said the Government had “made good progress” in its promise to end the Job Seekers’ Compensation Scheme and to reduce costs.
But he said that there would be “many challenges ahead” with a number of issues to be resolved.
He said that the Coalition Government would work with states to achieve a “fair and equitable deal” with jobseekers and that the “policies and processes that have worked for the past 12 months are the best they can deliver”.
In his first budget, the Coalition promised to scrap the JCCA scheme, and to “restructure” the scheme to create an “equitable scheme”.
In its first budget as Prime Minister, the Government said there was a “strong case for abolishing the Jobseeker’s Compensation Authority”.
The announcement came a day after Mr Newman’s former treasurer, Ian Macfarlane, said he did not believe the Government could afford to maintain the JCFA.
He had previously said the cost to taxpayers of maintaining the scheme “could not be justified” by the current circumstances.
In its last budget, in February, the government announced it would reduce the JCCC’s funding to the States and Territories.
The current funding to NSW and Victoria will not last beyond 2022, and it will be reduced by $3 million in 2019-20 and 2019-2020.
In February, Mr Newman also announced that the WA Government would cut $2.2 billion from the current JCCC and that $5 billion would be spent on a new jobseekers compensation scheme in WA.
“These decisions will mean that the JCEA will have a significantly lower funding base over the coming years,” Mr Newman wrote.
The JCC is a national welfare scheme for job seekers who are looking for work.
The scheme provides a range of services to job seekers, including unemployment assistance and income support, and the State Government has set aside $20 billion over four years to support the scheme’s operating costs.
The program is funded through the Commonwealth’s payroll tax, and its cost is passed on to jobseachers.
In July, the federal government announced that it would no longer be supporting the JCB, but would provide the states with “equivalent funding”.
The Federal Government has also promised to reduce the rate of benefit payments by 30 per per cent in 2019, from $150 to $100 per fortnight.
The states and territories will also receive a $1.5 billion welfare payment, the first step towards eliminating the JCA.