Readers of the Australian Financial Review might have noticed over the past few weeks a number of articles on the subject of disability employment that make reference to AHRI.
Let me give you a brief background. Back in August AHRI joined with the Australian Disability Discrimination Commissioner, Graeme Innes, and the Employment and Workplace Relations Minister, Bill Shorten, in calling on the ASX Corporate Governance Council to recommend that ASX listed companies report annually on what their members are doing about employing Australians with a disability.
We did not call for hard-line quotas. Rather we asked the ASX Governance Council to do for disability employment what it’s done for gender equity. While our approach is merely a call for a ‘recommendation’ to report, we believe that such a light-touch intervention has the potential to change the game.
This is why: A recommendation to report means that publicly listed ASX companies need to state what they’ve done, if anything, by way of drafting policies, implementing practices or recruiting people from the disability employment cohort of the Australian population. There is no requirement to have done anything but there is a requirement to report on the basis of “if not, why not”. Boards would need to consider making the recommended action a KPI for the CEO, an action that would result in knock-on KPIs down the management line.
That would in turn bring about a significant change in company behaviour. At AHRI we have the benefit of member responses to surveys we conducted in 2008 and 2011 on this issue, so we have access to data that reveals most organisations are unaware of the imperatives that relate to disability and employment, and to put it crudely, most organisations don’t want to know and see no reason why the matter should bother them.
So what are those imperatives? And why should business bother with them?
I’d like to answer the first of those questions by stating that simply being a good corporate citizen is not one of the imperatives. I hasten to add that contributing positively to the society of which a business enterprise is part, is undoubtedly the right thing to do and may also be good for business. But it’s not the chief reason for AHRI’s involvement in the area.
The central issue that has driven our engagement goes back to 2004 when the Treasurer Peter Costello delivered a speech notable for one dominant theme: ‘welfare-to work’. Its pivotal message was that national prosperity was suffering from a productivity malaise, the genesis of which was a two-part problem. The first part was that a large proportion of the population who could be active participants in the workforce were not working. That contributed to a significant loss of potential revenue through uncollectable tax receipts. It also negatively affected total factor productivity and was harmful to the national economy. The second part was that a considerable number of those Australians, around 800,000 in round numbers, were drawing disability support pensions (DSPs) from the Australian welfare system. That number consisted of Australians who suffered from a permanent or temporary disability but were officially looking for work. In summary, the issue was identified by the then Treasurer as an economic problem that was deemed worthy of its own budget theme.
It’s now nine years after that Costello budget and 2013 is now almost upon us. So what‘s happened in the interim? The short answer is nothing. Australians who collect DSPs and are looking for work still number in the magnitude of 800,000+, significantly more than the 637,000 on unemployment benefits. Around $9.5 billion is spent by government on DSPs each year and billions more are spent on government-funded disability support services designed to get participants ‘job-ready’. In 2004 around 68,000 people enrolled in those services. At last count this year, 170,000 participated. That looks like success of sorts. But the test of success finally is moving people from DSPs into jobs, and that largely continues not to happen. So the stoppers are not government inactivity or lacklustre motivation of job-seekers. The stopper is employer engagement, a conclusion our research confirms. Through no fault of their own, employers with a few exceptions are either unaware of the issue or regard it as none of their business.
AHRI is of the view that it’s the business of everyone and in that we are in agreement with the likes of the Business Council of Australia and others, including former Future Fund chairman David Murray who drove the point home on the ABC’s 7.30 Report recently. Murray identified the two-part malaise I’ve just described and called it the slippery road on which Greece now sits. There may be a touch of overreach in that comparison but it’s an indication of the seriousness with which the matter appears to be viewed in some high-level business quarters.
We will persist in our approach to the ASX Corporate Governance Council and I will keep you posted.
I would also appreciate any feedback from readers.
Lyn Goodear is the chief executive officer of the Australian Human Resources Institute and a member of the Employment Participation Minister’s Disability Employment Services Reference Group.