As the government weighs whether to extend single parental benefits to parents of children over the current age limit of eight in this week’s budget, new information has come to light about what happened when the rules were tightened in 2013.
When-Treasurer Peter Costello lowered the age limit from 16 in 2006, forcing single parents who hadn’t found work to pay (much lower) unemployment benefits, he said it would “help them with higher incomes and better participation in mainstream economic life”.
A few years later, when then Prime Minister Julia Gillard announced plans to remove a loophole that allowed some parents with children over the age of eight to continue receiving payments, her treasurer Wayne Swan said this would “reinforce the re-entry into would encourage the labor market”.
Has the closure improved or harmed lives?
Only recently available administrative data allow us to evaluate how single mothers fared after they lost payment when their children turned eight. Have they found work? Did they get higher incomes because they were put to work, or did their incomes fall?
Research that Bob Breunig and I conducted on the changes introduced in 2013 shows that the single mothers (they were overwhelmingly mothers) when taken together. lost income.
On the one hand, the change caused a significant minority (about a third) of single mothers to drop off income support and go to work, increasing their income.
On the other hand, it left the majority on income support and on lower incomes – an effect that overwhelmed higher incomes for those who left the payment and found jobs.
Multiple barriers to returning to work
What separates the majority (lower income) from the minority (higher income)? Although our particular dataset cannot identify features that distinguish them from each other, there are two likely explanations.
First, people who have been on social assistance benefits for a long time often face multiple barriers to returning to work, including illness and/or disability. For single mothers, this illness or disability can also apply to their children.
Second, there is something more harmful: domestic violence.
Conducted a personal safety survey shortly after the Gillard changes were found 60% of single mothers who had ever had a partner had experienced partner violence in their lifetime – an astonishingly high figure.
If domestic violence is at the root of single mothers’ welfare dependency (and it probably is), it doesn’t take rocket science to understand how difficult it is to get those mothers into work.
Single parents face greater financial constraints compared to dual-income households and greater constraints on their time, in terms of school pick-up and drop-off days, sick leave, and things like help with homework.
Domestic violence exacerbates these constraints, requiring more time and resources to find safe shelter, attend court hearings, and most importantly, as victims of trauma, take care of their own (and their children’s) mental and physical health .
The trauma caused by domestic violence can also be very difficult to escape when it is caused at every custodial hearing, divorce proceedings, non-custodial parental visits, or on the days when child support is due.
So what are the policy solutions?
First, the increase in employment, unaccompanied by an increase in income, appears to have taken place harmful effects on children. To the extent that mutual obligations lead to unstable and poorly paid jobs, they are counterproductive and detrimental.
Our research shows that additional mutual obligations did little to improve single mothers’ employment outcomes.
Second, individuals facing multiple barriers need tailored support that identifies and helps address multidimensional challenges.
The effect of domestic violence is difficult to determine
Scaling up individualized support can be challenging, which is where case management experiments at the local level can help. The new treasury evaluation unit are in a good position to ensure that this policy is designed to be evaluated and judged on its results.
Equally important, we need to be able to measure the impact of domestic violence on the economic security, employment and health outcomes of survivors and their children over time, as is done in countries such as Finland.
Read more: Already bad off, single parents took a dramatic turn during COVID. They educate our future adults
The datasets required for this in Australia already exist, but so far the government has not allowed the linking of longitudinal data on domestic violence and labor market outcomes.
Without the information that would result from compiling these datasets, Australia risks introducing policies, including those designed to help single mothers who are victims of domestic violence, without a means of evaluating their effectiveness.
Single mothers – whether employed or self-employed – are among the hardest working members of our society. They deserve better.