No 9 September 2001

MITTS Launch Departmental research updates Departmental seminars Branch news New publications Conference Reviews Forthcoming conferences Next issue

Simulating Tax and Welfare Reforms – Launch of the Melbourne Institute Tax and Transfer Simulator (MITTS) model FaCS, in association with the Melbourne Institute of Applied Economic and Social Research, hosted the launch of the Melbourne Institute Tax and Transfer Simulator (MITTS) model on 23 August 2001. MITTS has been developed as a result of a major research partnership, started in 1999, between FaCS and the Melbourne Institute. MITTS is a behavioural microsimulation model of the Australian tax and social security system. It examines the effects of income tax and transfer payments policy changes on individuals and households in Australia, as well as giving a guide to the cost to government of the proposed policy change. A distinguishing feature of MITTS is that it models labour supply responses to changes in taxes and benefits. The simulator consists of two closely integrated models. First, a static model, MITTS-A, examines the effects of a specified change in the direct tax and transfer system, assuming that the labour supply, and hence pre-tax and transfer income, of each individual remains fixed. Secondly, a „behavioural‟ model, MITTS-B, allows for the effects of labour supply variations in response to changes in the tax and transfer system. The launch featured a presentation on MITTS by Professor Alan Duncan, a leading exponent of such modelling from the University of Nottingham and the Institute of Fiscal Studies (IFS) and a Professorial Fellow of the Melbourne Institute. In his presentation, Professor Duncan, who lead the programming of the model, replicated a simulation that formed the basis of the Melbourne Institute Working Paper (written jointly with Mark N. Harris), „Simulating the Behavioural Effects of Welfare Reforms among Sole Parents in Australia‟. Copies of the Melbourne Institute working paper, „Simulating the Behavioural Effects of Welfare Reforms among Sole Parents in Australia‟, as well as Professor Duncan‟s

FaCS Research News

Page 1 of 23

Powerpoint presentation, are available by contacting Paul Delaney, Research Strategies, Strategic Policy & Analysis on email paul.delaney@facs.gov.au The working paper can also be downloaded from the Melbourne Institute website at: www.ecom.unimelb.edu.au/iaesrwww/wp/2001wp.html Further information about the MITTS model may be obtained from Andrew Whitecross, Director, Incentives Policy, Strategic Policy & Analysis on email andrew.whitecross@facs.gov.au

The idea that Family Tax Benefit (often called “Kid‟s Money” by some indigenous customers) is portable is making an important difference to the lives of aboriginal and Torres Strait Islander children in a selection of remote and regional communities. The children are in the care of a group of people (mostly women) who have agreed to participate in a pilot for the Diverse Care Project. The Diverse Care Project has been examining the diversity of family structures, and the impact of family assistance payments on children within those structures. The first phase identified a number of instances in which formal administrative arrangements for paying family assistance did not fit well with the family structures of various groups. This often happens where children are raised in extended or non-nuclear family structures. These groups comprise some of the most disadvantaged within Australia‟s total family customer population. In general the approach being tested in the Extended Family Care (or Statement of Care) pilot means grandmothers and other relatives who share the care of children can receive financial and other contributions for their costs without making a claim for Family Tax Benefit. Early results from the pilot suggest the approach alleviates family disputes over Family Tax Benefit and reduces the burden of having to contact the Family Assistance Office following frequent “changes of care”. More importantly it responds to the circumstances and needs of children within extended family groups who frequently move from carer to carer. Participants in the pilot agree to operate an honour system in sharing Family Tax Benefit monies with other family members to make sure their children get the benefit of the payments as they move from one carer to another. Participants form “care groups” with other family members who look after their children. They are not required to notify the Family Assistance Office/Centrelink as long as someone in the nominated care group is caring for a child, and money or goods in lieu follow the child. For many indigenous pilot participants, the standard requirement of reporting changes of care whenever a child has moved to another carer is often impracticable. The preliminary evaluation findings also suggest that enforcement of arbitrary administrative procedures is

FaCS Research News

Page 2 of 23

often less effective than encouraging participants to take responsibility for ensuring that payments are actually applied to the costs of the children. Pilot sites are located at Yarrabah, Cairns and Cherbourg (Queensland), Nowra, Wreck Bay, Illawarra, inner city areas of Sydney (New South Wales) and Alice Springs (Northern Territory). A phased evaluation process of the first pilot sites has commenced. It comprises a survey of Centrelink staff involved in running the pilots, workshop consultations with those staff and a survey of responses from participant family groups. An evaluation report is expected in October 2001.

For further information
On the Diverse Care Project or the Extended Family Care pilot please contact Jo Page, Policy Development Section, Family and Children Branch, on 6212 9417. or email Jo.Page@facs.gov.au

FaCS Research News

Page 3 of 23

Activity Test Evaluation: Customer Survey
The Activity Test Evaluation Customer Survey report is the second report released as part of the Department of Family and Community Services‟ evaluation of the activity test.1 The first report, „Survey of Community Attitudes to Unemployed People of Workforce Age ‟ was featured in the December 2000 (no. 6) edition of FaCS Research News. The customer survey collected information on the awareness, attitudes and behaviour of unemployed Newstart Allowance and Youth Allowance customers in relation to the activity test. The survey found strong support for current activity test provisions, with respondents indicating that most activities assisted with job search and skills development. Research Background The survey was conducted by the Wallis Consulting Group. Three thousand Newstart Allowance and Youth Allowance customers were interviewed during July and August 2000. The survey questionnaire was based on qualitative research consisting of five focus groups in metropolitan and regional Victoria. Key Findings Awareness and Attitudes The survey revealed that customers had a high level of understanding of job search and administrative requirements of the activity test. 85% of the respondents spontaneously cited the need to „actively look for work‟ as a requirement of the activity test. The survey also included questions to measure support for the concept of mutual obligation. 49% of respondents agreed that „unemployed people should have to do more than just look for work in order to stay on benefits‟, while 82% of the respondents agreed that „jobseekers receiving unemployment payments should have to do activities that will improve their chances of finding work‟. 62% of the respondents felt that „people should have to do something of benefit to the community in return for their unemployment payment‟. There was widespread support for the existing penalty regime for non-compliance with the activity test. 78% of all respondents agreed that „jobseekers not meeting their activity test requirements without a „reasonable‟ explanation should have their payments reduced for a period of time‟. Out of the number who had actually been breached, 69% agreed with this statement. A small majority of 57% of respondents believed that the size of current penalty rates was „about right‟, while job seekers who had been breached were more likely (at 50%) than other job seekers (34%) to consider the breach provisions too harsh. Specific Job Search Provisions Jobseeker Diaries (JSDs)


The activity test is the set of requirements that unemployed people receiving Newstart or Youth Allowance need to fulfil in order to demonstrate that they are actively looking for work.

FaCS Research News

Page 4 of 23

Of those respondents who were required to complete a Jobseeker Diary, 88% stated that having to do so helped them keep track of the jobs they had applied for. 23% of respondents indicated that they were more active in their job search than they would otherwise have been. However, 36% agreed that „most of the jobs they applied for were unsuitable‟, implying a degree of „low commitment‟ job search. Employer Contact Certificates (ECCs) There were mixed perceptions of ECCs, possibly related to their use as a compliance measure. While 47% of respondents who were required to complete ECCs felt that this helped them to keep looking for work, 46% agreed that they would not ask an employer to fill in an ECC if they were applying for a job in which they were particularly interested. Mutual Obligation/Work for the Dole Respondents who had participated in Mutual Obligation and Work for the Dole had positive views of these activities. 85% of respondents felt that this participation helped them establish a work routine and 79% felt better about themselves as a result of the activity. 73% supported the value of the scheme by agreeing that they had gained useful skills by participating. Survey Outputs The survey findings will contribute to the overall body of research on which the final Activity Test Evaluation report will be based. They have also informed policy development relating to welfare reform and the rules simplification project. The results were presented to the Centre of Full Employment and Equity (CoFFEE) conference in Newcastle on 14 and 15 June 2001. A copy of the CoFFEE paper is available on the FaCs Internet website at http://www.facs.gov.au/internet/facsinternet.nsf/aboutfacs/programs/esp-facs_attitutes.htm

Further information
Please contact Fiona Sawyers, Labour Market Analysis Section, on (02) 6244 7796 or email fiona.sawyers@facs.gov.au.

FaCS Research News

Page 5 of 23

Customer Participation Survey: Participation among working age people with and without disability
This article examines the interrelationship between disability, receipt of income support and economic and social participation. In the survey context, „disability‟ was self-defined by respondents as a medical condition that limits or affects the activities an individual can do. Data from the 1998 Customer Participation Survey is used to provide:   a summary of the demographic and income support characteristics of the survey population and how they differed by disability status; and an overview of levels of participation in economic and social activities among working age income support recipients with and without disability.

Characteristics of the survey population Around 43 per cent of recipients reported having a disability and the balance said they did not. These proportions compare with 20 and 80 per cent, respectively, for the Australian population as a whole. The survey data show some stark differences in the survey population by disability status. The majority of people with disability were male (58 per cent), whereas the non-disabled group was predominantly female (63 per cent). The disabled group was considerably older on average than their non-disabled counterparts, with some 70 per cent aged over 40 and half aged over 50. By contrast, one third of people without disability were aged over 40. This is consistent with the fact that there is a positive correlation between a person‟s age and the presence of disability. The different age structures of the two groups are associated with other differences. People with disability were equally as likely to be partnered or single, whereas the majority of the non-disabled group (58 per cent) were single. The non-disabled group, however, was much more likely to be parents of children living at home (51 per cent, compared with 21 per cent of the disabled group). They were also more than three times as likely to be lone parents (one quarter, against 7 per cent). As expected, the majority of people with disability (54 per cent) received Disability Support Pension (DSP), whereas the most common payments received by the non-disabled group were Newstart Allowance (46 per cent) and Parenting Payment (41 per cent). This suggests that receipt of DSP is not a good proxy for the presence of disability among the income support population as a whole. The incidence of reported disability is particularly high (over 40 per cent) in a number of other payments directed primarily to older age groups (Wife Pension, Mature Age Allowance, Widow Allowance and Partner Allowance). And finally, people with disability were much more likely to have long payment durations. Some 58 per cent had been on income support for two years or more, with one in five recipients having received income support for six or more years. Among the non-disabled group, on the other hand, half had been on income support for less than one year.

FaCS Research News

Page 6 of 23

Participation overview Table 1 (page 8) summarises overall rates of participation in economic and social activities as well as rates of participation in specific activities during the survey fortnight, by disability status. Again, these data show significant differences in the rates of economic and social participation between people with and without disability. As might be expected, the non-disabled group had a high rate of economic participation, 34 percentage points higher than that of people with disability (72 against 38 per cent). People without disability were more likely to be undertaking every activity classified as economic participation (paid work, employment, job search and study). These data point to the salience of disability in affecting the capacity to participate economically. At the same time, while an individual‟s ability to participate in economic activities may be reduced by their disability, their economic non-participation is by no means inevitable. Participation in the social sphere of activity was also most prevalent among the non-disabled group. This was almost entirely due to their much higher engagement in childcare activity, consistent with the increased probability of having dependent children living at home. Although people with disability were slightly less likely to be involved in volunteer work, they were most active in the area of adult care (15 compared with 11 per cent).

FaCS Research News

Page 7 of 23

Table 1: Rates of participation in economic and social activities, workforce-age income support recipients, by disability status, July 1998 PARTICIPATION RATE (%) Disability Status PARTICIPATION CATEGORY (a) People With Disability People Without Disability All

ECONOMIC Economic, no social (b) Economic & social (b) TOTAL Activities Paid work Self-Employment Job search Study SOCIAL Social, no economic (b) Economic & social (b) TOTAL Activities Volunteer work Child care Adult care Sample size (N=) Weighted population (%)
17 34 15 879 21 57 11 19 47 12 2,015 14 3 26 7 26 7 49 15 21 5 39 11

19 19 38

28 44 72

24 33 57

34 19 53

24 44 68

28 33 61

1136 57



Notes: (a) Multiple activities for some recipients mean that the participation rates for individual activities sum to more than the overall participation rate. (b) For most individuals, includes household activities.

Summary To sum up, the survey data show stark differences in the characteristics of the survey populations as well as in the levels of economic and social participation among people with and without disability. People with disability were most likely to be men, over the age of 50, on DSP and to have received income support for two or more years. By contrast, the non-disabled group was

FaCS Research News

Page 8 of 23

most likely to be female, single, aged 25 to 39, have dependent children, be either on Newstart Allowance or Parenting Payment, and to have received income support for less than one year. An important finding is that almost half of income support recipients who report activity-limiting disability do not receive the main disability payment (DSP). These data also show that disability is associated with significantly reduced economic participation, but many people with disability remain economically active. The lower economic participation overall among people with disability may also reflect the fact that they were considerably older than their non-disabled counterparts.

Further information
FaCS Intranet Site under Data Map/Research/Research Data and Support/ Participation Research; or Val Pawagi, Strategic Policy and Analysis Branch, on (02) 6244 6827 or email valerie.pawagi@facs.gov.au.

Workforce Circumstances and Retirement Attitudes of Older Australians
In the March 2001 issue preliminary results were presented on some of the findings from the workforce circumstances and retirement attitudes of older Australians project. Further work utilising data from the survey has proceeded over the last six months. This includes: 1. A paper presented at the National Social Policy Conference (Competing Visions -University of New South Wales 4-6 July 2001). The paper compared those in employment with those not working and examined the role of income support payments in relation to observed patterns of employment, voluntary retirement and involuntary exclusion. The authors reported a wide gulf in the outcomes of different people in the 45 to Age Pension age group between those supporting themselves and those receiving income support payments. Most notable were the much better health outcomes and higher home ownership levels of those supporting themselves compared to those receiving income support payments. It was also found that of those not working income support recipients were more willing to work than those not receiving income support payments despite much higher rates of disability and other indicators of disadvantage such as outdated job skills and poor education. 2. The preparation of four fact sheets summarising the findings in relation to people with disabilities; workforce experiences of people aged 45 to 69 years; retirement attitudes and intentions; and work and retirement for mature age women. The fact sheets will assist readers to understand the reasons older workers stopped working, the problems they had getting back to work and why they retired when they did. They also provide valuable information on the retirement intentions and plans of older Australians as well as providing information on the experiences of those who are already retired. These issues are particularly relevant given that the first of the baby boom generation are reaching the age of 55 this year.

FaCS Research News

Page 9 of 23

Some of the main findings included:  90 per cent of people with disabilities stated they would prefer to still be working;  77 per cent of people not in work saw their age as a definite barrier to getting a job  Around a half of the people surveyed preferred to retire before the age of 65;  86 per cent of people on income support expected government benefits in retirement, compared to 43% of those who were self-sufficient;  36 per cent of women in the 45-69 age group receive a social security payment; and  41 per cent of women working wished to retire before they turn 60.

Further information
Contact Glen McKinnon: (02) 6244 7212 for People With Disabilities; Harin Perera: (02) 6244 7649 for Workforce Experiences of People Aged 45 to 69 and Justin Marshall: (02) 6244 6224 for Retirement Attitudes and Intentions and Work and Retirement for Mature Age Women.

Welfare Reform Pilots
The Welfare Reform Pilots were developed in the context of the Interim Report of the Welfare Reform Reference Group, which called for the use of more experimental research to assist with the development of individually tailored and more flexible models of service delivery to the most disadvantaged income support recipients. The key objectives of the pilots are:  to collect information on participants‟ current activities, their goals for the future and the extent of the barriers that these people face in moving into employment or community related activities; and  to trial some interventions designed to assist the most disadvantaged welfare recipients to increase their economic and social participation. Three pilots comprise the Welfare Reform Pilots: 1. The Mature Age Participation Pilot focuses on older working age people without jobs which includes Newstart customers aged 50 and over; Mature Age, Widow and Partner allowees. 2. The Tailored Assistance for the Very Long Term Unemployed Pilot focuses on Newstart recipients with an income support duration of five years or more. 3. The Workless Families Pilot focuses on families with school aged children in which both parents are without work and workless parents of school aged children with repeated transitions between single and partnered status. Pilot design

FaCS Research News

Page 10 of 23

The three pilots used an experimental method with random assignment to assess the effectiveness of various strategies intended to increase participants‟ levels of social and economic participation. At the same interview, information was collected on the participants‟ social and economic activity levels, perceived barriers to participation, and their future goals and aspirations. Academics from the Social Policy Evaluation, Analysis and Research (SPEAR) centre at the Australian National University assisted with the design and development of the research method. AC Nielsen, a market research company, assisted with the development of the interview instrument and conducted phone interviews for all the control group participants and for the intervention group participants interviewed in the final phase. Michael Bittman from the Social Policy Research Centre, University of New South Wales, collaborated with AC Nielsen and FaCS in the development of an Activity Index to measure social and economic activity levels. Interviews were conducted in three phases Phase One for all intervention group participants involved an intensive face-to-face interview with specially trained Centrelink staff members. Customers discussed their circumstances and future goals in some depth. Depending upon their assigned stream, participants were offered referral information and/or a range of other assistance towards achieving some expressed goals. A Participation Plan was then drawn up with mutually agreed goals. Control group participants were asked about their previous work history and future goals and aspirations but were not provided with any assistance to access referral information or services and did not develop participation plans. Phase Two for the intervention group involved a shorter follow-up interview at Centrelink, generally with the same staff member who conducted the first interview, approximately eight weeks after the first interview. The interview focused on how the customer had progressed in relation to implementing their participation plan, particularly reviewing the outcome and/or take-up of any referrals made in Phase One. Control group participants were simply asked about their social and economic activity patterns since the first interview in order to assess if anything for them had changed. Phase Three interviews, for both intervention and control group participants, involved a shorter telephone interview conducted approximately six months after the first interview. AC Nielsen conducted all of these interviews which aimed to establish how participants have fared over a longer period and provide more information about their barriers and constraints.

FaCS Research News

Page 11 of 23

Analysis of Results Analysis of the descriptive data collected from the Pilots will be undertaken by FaCS and progressively released, as these become available in the later part of 2001. The Pilots will provide much detailed information not previously gathered on the respective customer groups involved. It is intended that this information on social and economic activity levels, future goals and aspirations, as well as perceived barriers, will assist with general policy development as well as provide specific input into the implementation of the Australian‟s Working Together package. FaCS has commissioned academics at SPEAR to undertake some of the more technical analysis related to the various interventions trialed in the experiment. The success of the intervention will be measured by changes in social and economic activity levels and the Activity Index will assist in this measurement. The Index may also have wider application as a means of measuring and comparing activity levels among income support recipients. The size and complexity of the data sets have required considerable amounts of time in „cleaning‟ and preparation of data files to make them ready for analysis by FaCS and the ANU. Although some results from FaCS‟ descriptive data analysis will be available during October, it is not expected that results on the intervention will be available before early 2002.

Further information
Marie Newey, Participation Policy Branch (02)6244 7451 email marie.newey@facs.gov.au or Chris Carlile, Participation Policy Branch (02) 6244 6426 email chris.carlile@facs.gov.au

The Household, Income and Labour Dynamics in Australia (HILDA) Survey: an update
Changes resulting from Wave 1 piloting The pilot testing process for Wave 1, described in Research News Issue 7, has been completed. Resultant improvements to the survey design and procedures included – a minor review of some questions, a shorter Person Questionnaire, inclusion of a Self-Completion Questionnaire for Wave 1 and, the provision of funding as cash incentives.

FaCS Research News

Page 12 of 23

Household selection and sample size The households for interview were randomly selected in 3 stages: First, the selection of 488 clusters across Australia. Then, the selection of 21-25 dwellings within each cluster and listing of all households within those dwellings. Finally, the selection of the households for interview. If the assumed response rate of 70% is achieved, the survey is expected to involve interviews with 7,800 households. As a full household response involves interviews with all members of the household aged 15 years or over and 2.1 persons per household are assumed, it is also expected the total number of achieved Wave 1 interviews could be 15,000. Wave 1 Fieldwork Interviewing for Wave 1 started in New South Wales on 26 August 2001, and will finish by 21 December 2001. There are 4 final survey instruments for Wave 1. A Household Form, Household Schedule, Person Schedule and Self Completion Questionnaire. These instruments, the interview showcards and the Wave 1 HILDA variable list are available electronically from the HILDA website. Discussion Papers and Technical Reports There are currently 4 discussion papers now available from the HILDA web page. These papers cover the survey design and plan (No. 1/00 - December 2000), the different methodologies of international panels (No. 2/01 - June 2001), possible file structures (No. 1/01 - March 2001), plus possible weighting and imputation strategies (No 3/01 – July 2001).

Further information
Enquiries about the HILDA Survey should be directed, in the first instance, to the HILDA website http://www.melbourneinstitute.com/hilda/ or to Professor Mark Wooden of the Melbourne Institute on (03) 8344 8882 or m.wooden@unimelb.edu.au. Enquiries about the email based HILDA User Group and comments about the Survey Instruments or survey procedures should also be directed to Professor Mark Wooden. Further enquiries about this survey should be directed to Karen Wilson, Helen Boden and Paula Chevalier, Longitudinal Data Section, Strategic Policy & Analysis Branch at email HILDA@facs.gov.au.

FaCS Research News

Page 13 of 23

The Longitudinal Survey of Australian Children (LSAC): an update
Tender process The final Request for Proposals to design and implement the Survey was released on 2 July 2001. Tenders closed in September 2001 and once a preferred tenderer is identified, contract negotiations will commence. It is hoped that contracts will be signed by December 2001. In addition, another half-day seminar was conducted co-jointly by the Department Family and Community Services and the Department of Health and Aged Care discussed the social determinants of child health and well-being. A review of this seminar is found in the following section.

Videos of the seminars are available from the Research Strategies section, Strategic Policy and Analysis Branch by calling (02) 6244 7624 or (02) 6244 5458
North American Social Experiments: Research Results & their Influence on Public Policy

Dr Gary Burtless from the Brookings Institution, recently conducted a seminar on the influence of social experiments on public policy, drawing on his experience in the United States and Canada. Dr Deborah Cobb-Clark from the Research School of Social Sciences, Australia National University provided comments based on her experiences conducting experimental research on social policy issues in Australia. Dr Burgess had a key role in conducting the first social experiments in the United States during the mid 1960s. It quickly became apparent that randomised trials could provide reliable information about the impact of policy intervention in a practical way. By comparing groups with similar characteristics, one group subject to the policy measure and the other not, the impact of other factors on observed outcomes could be allowed for and valuable information on the direction of causality between treatment and outcome could be measured accurately. Importantly, analysts were able to describe results in straightforward language, in contrast to non-experimental studies where research findings are often subject to many qualifications. This enabled policy makers to easily grasp the findings and significance of the experiment and to concentrate on the policy implications of the results in areas such as medical care, adult training and welfare policy. In addition, randomised trials could be conducted in a timely manner, ensuring the results were obtained while the issue was still on the policy agenda. Social experiments have become increasingly influential in the United States over the past three decades. They have on occasion overturned long-held assumptions about the benefits of particular policies. For instance, providing wage subsidies to long-term unemployed people enjoyed support across the political spectrum. However, a number of social experiments

FaCS Research News

Page 14 of 23

found that providing wage subsidies had a clearly detrimental impact on the employment prospects of people receiving them. As a result of the social experiments, the policy was quickly changed and replaced by more effective forms of employment assistance. Despite the advantages of social experiments, there are some very important issues associated with social science research that need to be considered. Ethically, it can seem unreasonable to prevent a control group from interventions that could potentially benefit them or to ask people to be involved in experimentation that could potentially hurt them. These concerns may be overstated, as many policy interventions are not currently available to all that would like them or need them. And, despite the best of intentions, some policy measures may not be of benefit to those subject to them. Although there appears to be an intrinsic unfairness in random assignment, it also needs to be remembered that the focus remains on benefits that outweigh costs. Potentially an intervention that may cause real harm is best confined to a small-scale trial from which the intervention can readily be withdrawn, rather than inflicting the harm unwittingly on a large population. It is often the case in medical research, that successful experiments may be quickly extended to larger groups without the long delays associated in traditional research and evaluation projects. The bottom line appears to be that, given a commitment to rigorous policy evaluation and in light of the limitations of alternative evaluation strategies, a compelling case can be made for the use of experimental trials in social policy research. The case for randomised field trials may be stronger in Australia than elsewhere. The national basis of much of Australia‟s social welfare system means that it is often not possible to compare the impact of different policies in different locations. Also, although a variety of econometric methods can be used to evaluate the effects of public policy, these methods are generally data intensive and the analysis of the impacts of policies over time often requires long term longitudinal data, which has until relatively recently, been lacking in Australia.

Population Ageing

A highly popular seminar on Population Ageing was held on 24 August. There were two speakers. Dr Natalie Jackson from the University of Tasmania presented material from her forthcoming publication “The policy-maker‟s guide to ageing: Key concepts and issues” (FaCS Policy Research Paper No. 13). Chris Richardson from Access Economics focused on some of the economic implications of an ageing population in Australia. Dr Jackson started off by describing how in the 1960‟s Australia had a “Young” Age Structure with the median age being around 18 or 19. Australia presently has a median age of 35 and by 2020 it will be 40. This is a reversal of the pyramid shaped population distribution that has been representative of Australia in the past. These changes in age structure reflect our progress through a ”Demographic Transition”, from zero population growth caused by high birth and death rates (which cancel each other out) to zero population growth caused by low birth rates and death rates (which cancel each other out). This involved a middle phase where the population increased in size and the young population changed to an old population. Dr Jackson went on to describe the regional differences that are occurring with demographic transition around the world. She also highlighted the difficulty of replacing an ageing

FaCS Research News

Page 15 of 23

population with migrants. A prominent example is Italy. To maintain the current population level, the Italians would have to increase their present migrant uptake of 6,000 per year to 251,000 migrants per year. To maintain the current ratio of working age to elderly, the Italians would have to increase their migration rate to 2.3 million people per year. The same problem of replacing an ageing population with an unfeasible and inordinately large amount of migrants exists for many other developed countries. Dr Jackson also described regional and racial differences in population profiles within Australia. Canberra has a youthful bulge in its pyramid shaped distribution caused by having three universities. Tasmania, on the other hand, experiences a substantial exodus of its youth and has a population profile resembling an apple core. Racial differences within Australia include the indigenous Australians who have a median population age of 20 compared to post war emigrants who have a median age of 50. Dr Natalie Jackson finished off by pointing out some of the economic implications of an ageing population. Of particular concern is the “Fertility Taxation Spiral”. Simply described, the Fertility Taxation Spiral suggests that as fertility decreases and the proportion of elderly increases, governments are forced to increase taxation. This encourages increased female participation in the labour force compounding the falling fertility problem and so the cycle continues. Chris Richardson‟s presentation focused on the economic effects of an ageing population. Presently, the average woman retires from full-time work at the age of 48 with the average man retiring at the age of 58. The peak in the baby boomer cohort is currently aged 55. This puts us on the cusp of a major demographic impact on the economy because an ageing population will affect who companies employ, how fast the economy grows and what customers will be buying in coming decades. Who companies employ will be influenced by the effect an ageing population has on employment levels. The working age population presently grows by 170,000 a year. However, as the baby boomers retire it will slow to just 125,000 over the entire decade of the 2020s. An important way of reducing the impact of a retiring ageing population on the economy is to extend the working life of the older employees. Research has shown that many mature workers provide high levels of work quality, productivity, loyalty, work ethic and lower job turnover and absenteeism. Many older workers also have valuable experience not able be acquired through training. According to Chris, a 10% increase in the participation rate of 55 to 70 years will result in an increase of 4% to the annual GDP. He believes that there is a substantial link between retirement age and economic growth and that a change in the mindset of Australians is required to stop the premature retirement of the older workforce. The spending patterns of the mature consumers are very different to the general population and will have an increasing and differential impact on growth rates of different sectors of the economy in the years to come. Currently, over 55s account for only 21% of the population but they own 39% of household wealth and receive 25% of disposable income. Their spending will increase by 61% over the next decade. As a consequence, we can expect a drop in demand for family and educational related items and a large increase in demand for health related items and services. Revenue from the GST will increase broadly in line with

FaCS Research News

Page 16 of 23

consumer spending, however most health related services are excluded from the GST, and their increasing significance will dampen GST revenues.
Social Determinants of Child Health and Well-being: Research and Policy Challenges

During 2001, the Longitudinal Data Section has hosted several international speakers with expertise of relevance to Longitudinal Survey of Australian Children (LSAC). In separate visits in January and May, Satya Brink and Allen Zeesman, from the Canadian Longitudinal Survey of Children and Youth (NLSCY), presented papers and gave advice to the LSAC team. In late September, the section hosted a visit from Professor Heather Joshi from the Centre for Longitudinal Studies, Institute of Education, University of London. Professor Joshi spent time with LSAC team to offer advice for developing the Survey. Her visit also allowed the Department to host a half-day seminar jointly with the Department of Health and Aged Care. Professor Joshi described „The Birth‟ of the United Kingdom Millennium Cohort Study of Children. The program, under the banner of the “Social Determinants of Child Health and Well-being: Research and Policy Challenges”, also included Dr David (Dan) Offord from the Canadian Centre for Studies of Children at Risk, who was visiting Canberra as a guest of the Department of Health and Aged Care. The seminar provided an opportunity for the two Departments to discuss the challenges of creating a cross-portfolio agenda for prevention and early intervention strategies in the early years. James Jordan, then Assistant Secretary, Strategic Policy and Analysis Branch, FaCS and Dr Judy Straton, Senior Medical Adviser, National Centre for Disease Control, DHAC spoke about initiatives and issues of interest to their respective Departments. The program concluded with a panel session, including Heather Joshi, Dan Offord, James Jordan and Lee Emerson from FaCS, Judy Straton, Emeritus Professor Jacqueline Goodnow (Macquarie University), and Barbara Wellesley (Good Beginnings Australia), on „The challenges of developing and implementing evidence-based social policy‟. Over one hundred people, including officers from FaCS, DHAC, DETYA, PM&C and AG‟s, academics and state/territory government representatives, attended this very successful event.

Following the departure of James Jordan, David Hazlehurst will join the branch in November 2001. The Strategic Policy and Analysis (SP&A Branch will continue operating under the joint management of Serena Wilson and David Hazelhurst.) The SP&A Branch would like to take this opportunity to thank James Jordan for his leadership and especially his role in initiating and developing a number of strategically important longitudinal data investments of the department. These include the FaCS Longitudinal (administrative) Data Set and the Household, Income and Labour Dynamics in Australia (HILDA) Survey. James also played a pivotal role in developing a partnership with the Melbourne Institute to the develop the Melbourne Institute Tax and Transfer Simulator (MITTS). James has moved to work as branch head in the Information and Research Branch in the Department of Health and Aged Care.

FaCS Research News

Page 17 of 23

David Hazlehurst joins the branch in November 2001. Prior to that David was Director of the Child Care Benefit and Policy Strategies sections in FaCS. He has also worked for the Department of Immigration and Multicultural Affairs and the Department of Prime Minister and Cabinet. The branch congratulates David on his promotion to Assistant Secretary and look forward to working with him.

Policy Research Paper Series

The following Policy Research Papers have recently been released and can be obtained from the Research Strategies Section, Strategic Policy and Analysis Branch on (02) 6244 7624 No 12 How do income recipients engage with the labour market? Paul Flatau and Mike Dockery The interaction between income support recipients and the labour market (1995-1999) is the key focus of this research. In the first part, the structure of income tests facing pensioners and beneficiaries are described and how these tests impact on the labour market incentives for income support recipients is discussed. By analysing the take up of part time employment options it was concluded that the exit rate from income support to non-support is greater for income support recipients who are employed at a given point of time. This provides support to the theory that part time employment provides a potentially important stepping stone to employment with sufficient pay to enable the individual to exit the income support system. No 13 The policy-maker’s guide to ageing: key concepts and issues Natalie Jackson The author provides a compendium of concepts and scopes the enormous implications arising from what it refers to as one of humanity‟s greatest achievements: the demographic transition. This phenomenon is characterised by the fall from high to low fertility and mortality in the developed world has resulted in a shift from youthful age structures as well as expansive growth to ageing and stationary or declining populations. The implications of the shift to existing social, economic, political and cultural structures are profound and provide enormous challenges to the policy-making community that must respond. No 14 The dynamics of participating in Parenting Payment (Single) and the Sole Parent Pension Garry F. Barrett Various summary statistics describe the demographic composition of the caseload and the lengths of time that lone parent families spent on the Parenting Payment (Single) (PPS)/Sole Parent Pension (SPP) in the period June 1995-June1999.

FaCS Research News

Page 18 of 23

Sole mothers who were relatively younger or older and with younger children had lower exit rates from PPS. There was also evidence that lone parents in public housing had longer stays on PPS, particularly in NSW and ACT. Although the unemployment rate was not significantly associated with the length of stay on PPS, it was found that lone parents with some job attachment had much shorter stays on PPS. The recipients were characterised as short-term recipients, long-term continuous recipients and those that cycled on and off the program in multiple episodes of PPS receipt (25%). The average length of stay on PPS was 55 weeks.

National Social Policy Conference 2001

The Social Policy Research Centre (SPRC), based at the University of New South Wales, hosted the 7th biennial National Social Policy Conference in July. The conference‟s theme Competing Visions - focused attention on different aspects of current inequalities in Australian society. Keynote and plenary sessions took up this theme in both theoretical and practical terms. Professor Anna Yeatman from Macquarie University presented a paper dealing with social citizenship and the tension between principles of freedom and individual self-determination in contemporary welfare states. Don Weatherburn, Director of the New South Wales Bureau of Crime Statistics and Research argued against the perceived wisdom of a direct link between crime and unemployment or poverty. Professor of Political Economy at Harvard University, David Ellwood, spoke on the topical subject of US welfare reform and its apparent success there, tempered by patterns of growing income inequality and potentially negative effects in a less advantageous economic situation to that experienced over the last three years. Forum sessions involved spokespeople from the three main political parties, including the Minister for Family and Community Services, Amanda Vanstone. Other forum sessions focused on the problematic notions of community, social capital and entrepreneurialism, spatial inequality, autonomy and dependency in indigenous communities, and the concept of participation used in welfare reform discussion. FaCS contributed a number of papers related to the different social policy areas of the portfolio. John Landt and Ralph Nicholls presented „More or Less Active: Experiences of Older Workers and Retirees‟. Jenny Bourne spoke about „ Issues in Service Delivery‟, focusing on the department‟s new partnership approach with community and other agencies in delivering services. Phil Brown, Anne McConnell and Rebecca Muldoon presented findings from the Youth Allowance Longitudinal Survey, concentrating on social and economic participation by allowees in education, training and work activities. Organisers were pleased with the outcomes from the conference, despite lower attendance figures, which was attributed to an increase in registration fees. FaCS has had a long association with the SPRC and the conference, previously providing direct funding to the Centre and, more recently, as one of three contracted providers of

FaCS Research News

Page 19 of 23

high-quality social policy research services to the department. Copies of papers are available from the SPRC web site or direct from their authors.

Hunters and Gatherers: The Collection, Provision and Sharing Information to Communities

8th Annual ATSILIRN Conference Two Day Conference: Thursday 1 – Friday 2 November 2001 Tradewinds Esplanade Cairns Each year a conference is held by the Aboriginal and Torres Strait Islander Library and Resource Network with the major aim of raising awareness of current issues facing information professionals and of current projects in this field. The 2001 papers will be presented in the key areas of access policies, indigenous research, archives, special collections, native title and oral history. Further Information: http://home.vicnet.net.au/~atsilirn/ Email: ilu@siq.qld.gov.au
Examining Aspirations, Income, Health and IT Issues Affecting Older Australians

COTA National Congress 2001 Three Day Conference Sunday11 – Tuesday13 November 2001 Old Parliament House Canberra This third Council on Ageing National Congress will feature a series and concurrent sessions to deal with issues that are at the core of the expectations of older Australians in the new millennium. The Congress will bring together policy makers, service providers, academics and others to discuss key issues of adequate income, good health and services, increasing access to information technology and policy responses to existing and emerging issues. For Information: E-mail: ozacom@ozacom.com.au Phone: 1800 814 611
Life Course Perspectives on Health and Wellbeing

Two Day Conference: Monday 19 and Tuesday 20 November 2001 One Day Workshop: Wednesday 21 November 2001 School of Public Health

FaCS Research News

Page 20 of 23

Queensland University of Technology Brisbane This two day conference and one day workshop considers emerging evidence on life course influences on later life health outcomes from a range of Australian and International studies including population-wide surveys, longitudinal research and intervention studies. The program will highlight innovative approaches to life course research, and consider the articulation between policy makers and service providers and the activities of the research community.

Further Information: www.hlth.qut.edu.au/ph/courses/ihss
The Challenges of Aboriginal and Torres Strait Islander Research: Does Aboriginal and Torres Strait and Islander Research contribute to Quality of Life?

Two Day Workshop: Wednesday 21 November – Thursday November 2001 School of Public Health Queensland University of Technology Brisbane The purpose of this two day workshop is to broaden the understanding of Aboriginal and Torres Strait Islander research methodologies from a number of perspectives including cultural studies, education and health. As more Aboriginal and Torres Strait Islander academics and communities are becoming involved in research, are the universal methodologies that are currently practised enhance the quality of life in communities? Further Information: www.hlth.qut.edu.au/ph/courses/ihss

FaCS Research News

Page 21 of 23

Family Strengths Conference

2-5 December 2001 The University of Newcastle Callaghan, NSW This three day comprehensive conference and workshop program will provide a wealth of information and opportunity to participate in areas relating to family strengths. The exciting program will focus on areas such as using research, developing policies for supporting families and communities, how to strengthen the extended family, social capital, family resilience, adolescent health outcomes, the elderly, recognising family strength, stepfamilies, partnerships between family and community, people with disabilities, among many other topics. Further information: www.newcastle.edu.au/department/fac

TASA 2001 Conference

3 day Conference Thursday 13 December – Saturday 15 September 2001 Faculty of Education University of Sydney Sydney The conference will cover a wide range of streams over the three days. Some of the areas include sociological theory and the sociology of the life cycle (family, youth and ageing), urban sociology and community responses, class and inequality and sociological research methods. There will also be workshop sessions on areas relating to disability, inequality, globalisation and longitudinal studies. There will also be a Health Sociology Day on the Wednesday 12 December 2001, prior to the conference. For information: http://www.edfac.usyd.edu.au/project/tasa2001/
Persons, Processes and Places: Research on Families, Workplaces and Communities

7-9 February 2002 Hyatt Regency Hotel San Francisco California This is an academic conference sponsored the Business and Professional Women‟s Foundation, the Centre for families at Purdue University and the Alfred P Sloane Foundation. The conference will feature research on relationships between work conditions and family life. Special attention will be paid to developmental and relationship processes and to the roles played by communities. Further information: www.bc.edu/wfnetwork

FaCS Research News

Page 22 of 23

Purdue University West Lafayett

IN 47907 -1267

Parenting Payment Intervention Pilot: an update Heading Deadline for articles and research updates: 5 December 2001

ISSN: 1442-7524 Research Strategies Section Strategic Policy and Analysis Branch Department of Family and Community Services Box 7788 Canberra Mail Centre ACT 2610 Internet: http://www.facs.gov.au Editorial enquiries: Phone: (02) 6244 Fax: (02) 6244 7020 Email: research.newsletter@facs.gov.au

FaCS Research News

Page 23 of 23

To top