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Publication: Australian Journal of Social Issues
Date published:
Language: English
PMID: 67745
ISSN: 01576321
Journal code: SJSS


The activation of people receiving welfare benefits has become a core policy objective of social welfare and labour market assistance in most OECD countries over the last two decades. Activation has entailed an attempt to transform employment assistance and social security systems to make them more employment-friendly through the development of explicit linkages between social protection policies, labour market participation and labour market programs (Barbier & Ludwig-Mayerhofer 2004; Van Oorschot 2004). This move from 'passive' to 'active' social policy, often under the policy rubric of 'welfare to work', has a common aspect of aiming to enhance economic efficiency and productivity through outcomes such as improved access to the labour market, development of job-related skills, and more efficient labour markets (Lodemel & Stafford 2002; OECD 1994).

However, in many countries the goals of activation have extended beyond economic outcomes to also include the achievement of social goals. Particularly in Europe, activation policy has been viewed as a key policy lever to reduce poverty and disadvantage (Adams Sc Thomas 2007; Scott 2006).

At the same time there has been a growing interest in the concept of social inclusion as an approach to understanding and responding to disadvantage (DaIy & Silver 2008; Levitas et al. 2007; Silver 1994). Social inclusion is a commonly stated goal of activation programs (Lodemel Sc Stafford 2002), and a move from passive to active welfare is also a key part of the social inclusion approach (DaIy & Silver 2008). In most countries the social inclusion approach also has had an underlying goal of supporting improved economic performance in a globalised economy, often with particular emphasis on the integration of disadvantaged groups into the market economy as a means to achieve this. However, despite some synergies between these approaches, in other respects it is not clear that they are always compatible.

This article explores the extent to which activation programs are central to the social inclusion approach in the United Kingdom, European Union (EU), and in Australia. The paper briefly reviews the concept of activation and its fit with social inclusion goals and programs with reference to examples. It then examines the evidence regarding the ability of activation programs to enhance social inclusion, before turning to policy implications and directions.

Employment and Social Inclusion

At a basic level the concept of social exclusion aims to build an understanding of disadvantage based on non-participation in customary activities of society, rather than on purely financial measures such as a level of income or expenditure. Elements that have been identified as characterising a social inclusion approach to policy include:

* Understanding disadvantage as multidimensional

* A broad understanding of participation

* Joined up or integrated policy responses (across problems, sectors, levels of government, and life transitions)

* A dynamic and long-term perspective

* Addressing processes of exclusion and systemic issues

* Using both universal and place based policy interventions

* Focusing on active participation and active welfare

* Involving service users and other stakeholders

* Rebalancing rights and responsibilities

* Developing human capital and capabilities

* A preventative and remedial focus (see variously: DaIy 2006; DaIy & Silver 2008; European Commission 2008; Jones & Smyth 1999; Muffels et al. 2002; Nicholson 2008; Saraceno 2002; Saunders 2003; Smyth 2008; UNDP 2006; Williams 2008)

However, in practice social exclusion approaches often have a strong focus on economic or material dimensions of exclusion, particularly unemployment and poverty. In many countries, there is a strong emphasis on moving long-term unemployed people into paid employment as a means to achieve inclusion as well as to enhance economic competitiveness.

The place of work in the social inclusion approach

Participation in paid work has received considerable attention within the social inclusion literature. Long-term unemployment has been recognised as an important cause of social exclusion and labour market exclusion has been identified as a dimension of social exclusion in itself (Gordon et. al 200O)(UNDP 2006). The United Nations Development Program has defined exclusion as being the interconnection and presence of employment deprivation (unemployment and non-participation in the labour market), and economic deprivation (poverty) and socio-cultural deprivation (social isolation) (UNDP 2006).

The aspect that has received the most empirical attention is the relationship between unemployment or non-participation in the labour market and social exclusion (Adelman et al. 1999; Atkinson et al. 1998; Gallic 1999; Green 1997; Saraceno 2002; Saunders 2002). However, other research has also highlighted the need to also consider the exclusionary potential of certain types of low paid or low quality work (Atkinson et al. 1998; Bradley et al. 2003; European Commission 2001; Gallic & Paugam 2002).

Ruth Levitas's (2007) typology of social exclusion is particularly relevant in exploring the interaction of activation and social inclusion policies. She identifies three discourses of social inclusion the Social Integration Discourse (SID) the Moral Underclass Discourse (MUD) and the Redistributive Discourse (RED).

SID focuses on lack of participation in the labour market as the primary cause of exclusion and paid work as the primary means for social inclusion to be achieved, with activation programs seen as a key policy lever. However, the approach focuses narrowly on placement in paid work and ignores ways in which employment may not achieve inclusion, or even be a cause of exclusion, such as low pay. There is also little focus on improving the incomes or reducing exclusion faced by those not in paid work. Levitas et al. (2007) argue that SID has underpinned the social inclusion model in both the UK and the EU more broadly.

MUD emphasises the moral and cultural causes of poverty and focuses on the deficits of the disadvantaged and unemployed. This approach has links with activation programs primarily through paid work being seen as a means by which to discipline and re-socialise problem groups such as potentially criminal young men and single mothers. RED, on the other hand, views social exclusion as the result of a lack of material resources and hence providing improved income through redistribution is seen as a key means to achieving inclusion; however, despite the emphasis on income, disadvantage is seen in broader terms than simply financial poverty, recognising its dynamic and multidimensional nature. Due to the emphasis on income, activation programs have a less central role under RED.

Country evidence

The extent to which activation programs have had a central place within social inclusion agendas has varied across the countries and regions that have made use of the inclusion concept in social policy development and implementation. In the UK, the adoption of the social inclusion approach by the Blair Labour Government was strongly linked with boosting participation in employment. The 1994 Commission on Social Justice report argued for the move towards a social inclusion approach as a means to support the integration of disadvantaged groups into a flexible labour market and a dynamic knowledge based economy (Atkinson 2008). Following on from this, New Labour viewed activation policies as a key policy lever through which to achieve social inclusion and enhance both economic and social outcomes. A primary focus of New Labour's approach to combating social exclusion was the creation of employment and education opportunities for groups including workless households and single mothers (Perkins et al. 2004). Similarly a review of social inclusion initiatives targeting groups at high risk of exclusion in Canada found that the main policy response involved providing employment assistance (Gingrich 2008).

In the EU, DaIy and Silver (2008) suggest that the meaning of social inclusion within the Lisbon process has changed and become more employment focused over time. Between 2000 and 2004 the Lisbon process was construed in terms of implementing policies that would prevent the risks of social exclusion through the provision of access to employment, basic resources, goods and services and providing avenues for participation in public life. More recently the focus has become more centred on growth and jobs with a greater emphasis on promoting involvement in the labour market. The increased emphasis on activation has moved the emphasis of social inclusion from a concern with economic and social functioning to one of employment and the financial sustainability of benefit systems.

In Australia, the concept of social exclusion was embraced by the Australian Labor Party (ALP) government in the run up to the 2007 election through its Social Inclusion Agenda and formally adopted by the Rudd Government after its election win. The Australian Social Inclusion Board was created in May 2008, and charged with advising the government, consulting with the community and reporting on social inclusion in Australia (Commonwealth of Australia 2009). According to the Government, social inclusion is important due to its potential to improve the wellbeing of all by:

* eliminating the threats to security and harmony that arise from excluding groups in our society

* improving economic performance by allowing everyone to make a contribution

* enhancing pride in being a society which not only values fair treatment and opportunity, but actually works hard to achieve it (Commonwealth of Australia 2009: 1)

Having the opportunity to secure paid work is one of the key features of inclusion in the Labor Government's definition of social inclusion, and then Deputy Prime Minister (and Minister for Social Inclusion) Julia Gillard has spoken openly about social inclusion having a strong economic imperative that is linked closely with increasing participation in employment.

"My reason for adopting such an approach is simple: at a time when Australia needs more skilled people and has an ageing population, we simply can't afford to have one in ten or more of our people out of the workforce due to unemployment, low skills or the effects of chronic poverty. Social inclusion is an economic imperative (Gillard 2007: 1)."


"A key aspect of Labor's social inclusion agenda will be a focus on a broad participation agenda that tackles the core reasons for Australians not participating in the workforce (Gillard & Wong 2007)."

More broadly, it has been suggested that the Agenda will be able to replace 'a welfarist approach to helping the underprivileged with one of investing in them and their communities to bring them into the mainstream market economy'fGillard 2007, p.l). The use of such investment language also implies a focus on achieving a return through paid employment in the market economy.

Similarly, a member of the Australian Social Inclusion Board has noted that the strong focus on economic performance is being increasingly tied to labour market participation: 'We are at a time when our demographic trends mean that lifting workforce participation levels is becoming critical to economic performance (Nicholson 2008: 1).

Consistent with Levitas' Social Integration Discourse, in addition to the goal of increasing participation in paid work being a key rational for the adoption of a social inclusion approach in Australia, paid employment is also seen as being an important path to social inclusion. Julia Gillard has noted that 'full-time employment is the most effective weapon to guard against poverty and disadvantage' (Gillard 2007: 3) and workforce participation is seen as providing a broad range of benefits to individuals and communities:

Workforce participation is a foundation of social inclusion; it creates opportunities for financial independence and personal fulfilment. Labor believes that as well as being good for individuals, increasing workforce participation benefits local communities, regions and the broader economy. Communities are more prosperous and cohesive when those who can work, are working (Gillard & Wong 2007).

However, the need for other policy initiatives outside of welfare to work is also acknowledged by the government. This includes recognition of barriers that prevent participation such as poverty; poor education; drug or alcohol dependence; inadequate access to housing; disability; chronic ill health; or mental illness (Stephens 2008a; Stephens 2008b). Similarly, the framework outlined by the Social Inclusion Board identifies the need for attention to the provision of resources in the individual (e.g. health, skills, social networks), family (e.g. housing, family health, home environment) and community (e.g. infrastructure, transport, environment) domains (Commonwealth of Australia 2009).

Activation and Inclusion

The primary means by which the social inclusion approach aims to move people into employment is through activating welfare to work programs. However, although social inclusion is a commonly cited goal of activation programs there are key differences between the two approaches that suggest they will not necessarily lead to the same policy objectives or interventions.

Activation policies

The concept of activation originated Sweden and other Nordic countries from in the 1930s where it became a key policy instrument to achieve full-employment and provide social security (Johansson 2001). Benefits were extensive and generous but carried a range of qualifying criteria such as participating in active labour market programs and actively looking for work (Johansson 2001). Activation in this context aimed to overcome labour market adjustment problems and increase flexibility whilst protecting the needs of workers (Barbier 2003).

Activation has existed in its more contemporary form since the 1980s and was a response to the rise in the number of income support recipients in the late 70s and early 80s, an increased drive for flexibility, and the change in the economic paradigm (Barbier & Ludwig-Mayerhofer 2004; Johansson 2001). In 1994 the OECDs Jobs Study asserted that ? progressive shift of resources is needed from passive income support to active measures' (OECD 1994: 36). These, it was argued, could improve access to the labour market, develop job related skills, and promote more efficient labour markets as well as strengthening the link between the growth of aggregate demand, job creation and the supply of qualified labour. Active measures were also seen as being able to assist in controlling inflation by improving the ability of disadvantaged job seekers to compete for jobs (OECD 1994).

Since this time most OECD countries, including Australia, have introduced active labour market policies, although generally in a manner consistent with each country's ideological and institutional history (Kvist 2000). The rationale for the use of activation has been to enhance economic efficiency and productivity, linked to varying degrees with the attainment of social goals.

At a practical level activation programs can include job search and training programs or requirements; work for benefit programs; subsidised work placements; education or vocational training; publicly created jobs; and social activation (Lodemel &c Stafford 2002).

Like social inclusion, the activation discourse aims to increase participation in employment; however where the social inclusion approach would pay attention to supporting participation in other life domains, the activation approach would generally view employment as the sole goal, with little emphasis on broader participation outcomes. Similarly, the activation approach would tend to be focused narrowly on interventions directly related to employability, where a social inclusion based employment program would recognise and address multi-faceted disadvantaged through joined up policy responses. Further differences may also be present in the social inclusion approach's emphasis on sustainable employment in decent work, rather than simply the movement of individuals into paid employment, and the emphasis placed on addressing processes and causes of exclusion.

Activation types

Potential differences between the activation and social inclusion approaches are also be affected by the range of activation variants that have been implemented across countries. Barbier and Ludwig-Mayerhofer (2004) identify two ideal types of activation- the liberal type and the universalistic type. The liberal type focuses on enhancing individual relationships with the labour market, which are then assumed to achieve social equity and efficiency at a macro level. Employment and social policies under these systems have a limited role primarily focusing on encouraging individuals to seek work, providing information and simple job matching services and short-term vocational training. Tax credits and in-work benefits are widely used. Activation measures aim to encourage employment participation over the life cycle and encourage people to take any job available. Having a conventional paid job is the normal way of assessing protection from risk and this is used to reduce the reliance on social assistance.

By contrast the universalistic type provides comprehensive services to all citizens, guarantees relatively high standards of living for those on benefits and the low paid. There is less emphasis on simply reconnecting individuals to the market and social policy maintains an emphasis on enhancing well-being. Activation is applied to citizens in a relatively egalitarian manner and attempts to achieve a balance between individual and social demands, in a labour market with good quality jobs.

The liberal type of activation has been suggested to have clear limits to its ability to achieve social inclusion beyond simple labour market attachment. However, the universalistic approach has greater potential to support broader social inclusion through a broader participation focus and consideration of in-work exclusion, and of the needs of those outside the workforce (Barbier & Ludwig-Mayerhofer 2004).

Evidence of Inclusion/Exclusion in Activation Approaches

Employment focused inclusion

Although social inclusion is a commonly cited goal of activation programs, it is generally based on a narrow definition equating inclusion with paid work. This involves an assumption that unemployment causes exclusion, that paid work leads to inclusion and that unpaid work alone will not achieve inclusion (McLaughlin 2005). It is generally a top-down, paternalistic perspective that sees paid work as the primary route to reintegration into society (Halvorsen & Jensen 2004; Van Berkel 2000b).

Van Berkel (2000a) describes this strong employment focus as being: labour market centred, with other methods of promoting inclusion being ignored; deterministic, in viewing paid work as being necessary for inclusion in other life domains; and based on an objective concept of inclusion or exclusion that operates from an outsiders perspective.

The 'labourist' outlook has been identified by some as a substantial impediment in achieving genuine inclusion for participants in welfare to work programs (Dean et al. 2005; Van Berkel 200Oa). Indeed as van Berkel (200Ob: 15) comments:

"Most current inclusion policies or activating social policies are, in fact, employment policies, aiming at increasing people's employability and at stimulating their labour-market integration. Increasing economic independence and decreasing social benefits dependence, rather than promoting social inclusion in a wider sense..."

Problems with the labourist approach to inclusion are that it ignores the potential for inclusion through other forms of participation, including non-paid work and caring; places too much emphasis on placement in employment without recognising the influence of job characteristics on inclusion; and is based on an implicit or explicit assumption that work will lead to increased participation in other life domains (Van Berkel 2002).

Placement in employment may fail to result in inclusion for a range of other reasons such as support being withdrawn to quickly after placement; placements turning out to be inadequate; lack of scope for career mobility or skill development; or placements being temporary and not achieving sustainable inclusion (Perkins &c Scutella 2008; Van Berkel 2002). The focus on placement in work can also divert attention away from the need for adequate income, something often not provided by part-time, temporary and low-paid employment into which disadvantaged job seekers are likely to be placed.

The focus on simply increasing employment participation of disadvantaged groups can be seen as a 'weak' version of social inclusion, where solutions are based on modifying excluded people's characteristics and facilitating integration into the dominant society. Alternatively under a 'stronger' version of social inclusion unemployed individuals would be recognised as capable actors and emphasis would also be placed on systemic causes of exclusion, those who are doing the excluding and the power relations between them (Martin 2004). Although activation programs alone are limited in the extent to which they are able to address structural causes of exclusion they can be implemented as an integrated part of a broader social inclusion agenda. In the UK, for example, the New Deals were implemented as part of a broader package of reforms including working tax credits and a strengthening of employment protection (Perkins et al. 2004).

The work first approach

The 'work first' approach is a common activation type typical of the liberal approach. The model focuses on active measures such as assisted job search, mandatory 'workfare' programs, short-term work preparation, and threat of benefit withdrawal to push people into work as quickly as possible (Peck 8c Theodore 200Oa). Work first programs generally offer high levels of pressure but only low cost and minimum service interventions. They are often based on a deficit model of the unemployed, and assume the initial transition into employment will act as a stepping stone to further career progression despite significant evidence to the contrary (Richardson 2003). As White (2001) notes, the primary aim of this approach is not to reduce poverty or social exclusion, but instead to reduce dependence on welfare.

The work first approach has proven to be relatively successful with less disadvantaged job seekers, but there are a number of aspects of the approach that mean it is unlikely to enhance social inclusion of more disadvantaged job seekers facing greater barriers. These include:

* A narrow focus on economic outcomes

* Lack of focus on non-vocational barriers

* Lack of emphasis on skill development

* No consideration of job quality

* No emphasis or support for employment advancement (Perkins & Scutella 2007; Theodore & Peck 2001).

The work first approach was adopted in Australia after the election of the Howard Government in 1996, when it replaced the Scandinavian inspired Working Nation activation programs, implemented by the previous Keating government, with the Job Network. The Job Network approach was based on low levels of investment in assisting job seekers to overcome barriers to employment, a reduced focus on education and training, and the use of a more punitive and coercive approach through the introduction of Mutual Obligation (Carney & Ramia 2002). Broader welfare to work policy framed unemployment primarily in terms of individual and behavioural deficits (Mendes 2000) rather than structural factors such as a lack of jobs.

Although the Job Network was reasonably successful in moving less disadvantaged job seekers into employment it did not achieve good outcomes with more disadvantaged job seekers (Perkins 2007).

Some authors (Carney 2006; O'Donnell 2000; Peck &c Theodore 200Ob) argue that the work first model can be socially regressive when coupled with a deregulated labour market, as was pursued by the Howard Government: 'Welfare-to-work programs of this kind not only exploit the conditions found in contingent job markets, they also contribute to the regulation and reproduction of these job markets, most obviously by constituting a continuously job-ready, 'forced' labour supply for the lower end of the labour market'(Peck & Theodore 200Ob: 123). Under such conditions activation programs would have a role in causing further exclusion by supporting the creation of poor quality employment, and propelling those at the lower end of the labour market into these jobs, which have a high risk of exclusion.

Individual Placement and Support

The Individual Placement and Support (IPS) model has been used with groups of unemployed people with mental health and other severe personal barriers in the US and Europe, and is a good example of an activation model that has the potential for a high level of compatibility with a social inclusion approach. The IPS approach recognises the complex ongoing support needs of people with a mental illness as well as other barriers such as substance abuse, homelessness, and contact with the criminal justice system (Lawlor & Perkins 2009) and addresses these in tandem with vocational needs to achieve competitive employment outcomes (Shaheen et al. 2003).

It provides intensive non-vocational and vocational support, that is highly integrated and delivered through separated practitioners, and utilises a carefully defined and tested model of employment assistance, in an environment that is highly work focused and views work as part of an individuals' broader recovery and reintegration into society.

However, despite the strong work focus and goal of rapid movement into work IPS differs substantially from regular 'work first' programs that provide minimal support and push people into the first available job. It addresses multiple dimensional disadvantage in an integrated way, is non-compulsive in providing participants with employment support when they choose, it has a strong focus on finding work that matches a person's preferences and capacities, and provides time unlimited support after placement (Bond 2004; Lawlor & Perkins 2009). However, its focus does not include broader systemic or structural causes of exclusion.

In a review of 12 randomised control studies working with individuals facing severe mental health problems, Drake et al. (2006) reported that nearly two-thirds of those people assigned to the IPS model attained competitive employment, compared with less than a third of those assigned to other vocational programs. Similar results have been obtained in many other studies, where IPS clients gained competitive employment faster, stayed longer in employment, worked more total hours and earned higher wages, than those in comparison programs (Bond 2004; Drake et al. 1999; Lucca et al. 2004; Shaheen et al. 2003)

Other impacts

At an operational level research has identified a range of issues affecting the ability of activation programs to support social inclusion. One of the greatest of these is the lack of attention to the quality of employment placements and sustainable inclusion. Studies in a number of countries have found that employment placements are often in short-term or poor quality/pay jobs in the secondary labour market that do not act as stepping stones to better quality work (Dean et al. 2005; Lightman et al. 2005; Van Berkel 2002; Van Oorschot &c Abrahamson 2003).

Poorly designed performance management and incentive systems can also encourage non-inclusionary outcomes. This can include the placement of job seekers in short-term jobs that will ensure a paid outcome for the provider, with the job seeker then returning to be placed (and provide a paid outcome) again; withholding support until a job seeker reaches a longer duration of unemployment and will provide a greater financial outcome payment; and working with job seekers that will be easiest to place, while providing the least support to those with the highest barriers and least chance of providing a paid outcome (Murray 2006; Perkins Sc Scutella 2008).

Although, social participation and outcomes are more difficult to measure, recognise and reward, these are likely to support social inclusion in a number of ways if effectively implemented. These include providing an incentive for providers to address non-vocational barriers; reducing the risk of providers 'parking' clients with little chance of moving in to work; and supporting a broad range of participation types. (Perkins 2008b).

In terms of employment placements, research in Europe, Australia and the US suggests that activation programs have often struggled to move highly disadvantaged and long-term unemployed back into employment (Bitler et al. 2008; Perkins 2007; Petrongolo 2009; Van Oorschot 2004). There is also some evidence of programs leading to further exclusion among those facing the greatest barriers (Mogstad & Pronzato 2009; Petrongolo 2009).

Looking at different types of activation programs across the EU, van Berkel (200Ob) found that these delivered mixed results when assessed in terms of their impact in enhancing social inclusion.

Paid work schemes were found to have some capacity to contribute to inclusion by providing financial independence; increased income; social contacts; and self-confidence. Although risks included the failure of these to act as stepping-stones into regular employment, program cycling and stigmatisation. Permanent schemes were found to have less inclusionary potential than temporary schemes. Unpaid work had some ability to enhance inclusion of participants but this was limited because of the lack of economic independence and income improvement offered. Unpaid work was also usually positioned as a last resort or at the bottom of the participation hierarchy in activation programs. Education and training could have a significant positive impact on inclusion, but this was highly dependent on the improvement in people's ability to find a suitable job after completion. However, it is also likely that participation in education and training may have positive effects on other life domains. Finally, the fit between the activity offered and the individual's needs and preferences was identified as an important factor affecting inclusion outcomes.

Conditionality and sanctions

Changes in eligibility for social assistance have also impacted on the capacity of activation policies to achieve inclusion goals. In Europe, unemployment insurance became more difficult to access in almost all countries over the 90s, and there was a trend towards reduced generosity and stronger obligations (Kvist 2000). Similar changes have been seen in the US under the welfare changes brought about by the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA, Pub.L. 104-193, 110 Stat. 2105) and in Australia under the Howard Government's implementation of Mutual Obligation in welfare policy, although these have been relaxed since the election of the Rudd Government (ACOSS 2008; Perkins 2008c). A related change has been an increase in the use and severity of sanctions across most OECD countries (Barbier &c Ludwig-Mayerhofer 2004). There is strong evidence that the most vulnerable job seekers will find it difficult to meet more onerous activation requirements, leading to sanctioning and a high likelihood of further exclusion (Perkins 2007).

Policy Implications

Although welfare to work programs appear to have had mixed success in achieving social inclusion outcomes, and in some cases appear to contribute to exclusion, based on the analysis above a range of policy implications can be identified which, if taken into account, might improve the ability of such initiatives to support inclusion. These relate to the operation of programs themselves and the need for integration within a broader social inclusion policy framework.

Program implications

Factors that are likely to enhance the inclusionary potential of activation programs include:

* Using a broad definition of participation that extends beyond simply participation in employment and does not equate inclusion with participation in paid work (Van Berkel 2002);

* Using enabling policies that aim to overcome both financial hardship and promote participation (Van Berkel 2002);

* Recognising the multidimensional nature of individuals' problems and responding with multidisciplinary interventions including better integration with services such as mental health, housing, drug and alcohol etc. (European Commission 2008; Evers 2007; Perkins 2008a);

* A more proactive focus including the creation of learning opportunities within jobs and outside of them (Raveaud 2002) (European Commission 2008; Perkins &c Scutella 2008);

* Greater emphasis on the quality of the employment offer and its fit with an individual's preferences, capabilities, barriers and other types of participation (such as caring or study);

* A longer term focus that aims to support sustainable employment outcomes as well as career development and advancement (Perkins &c Scutella 2008);

* Carefully developed social participation measures ensuring that payment and performance management systems provide adequate incentive for providers to look beyond employment placements (Perkins 2008b);

* Use of a lenient compliance system (Perkins 2008a).

Australia seems to have heeded some of these lessons. The Rudd Government replaced the Job Network and a number of a smaller employment programs including PSP and JPET with the Job Services Australia system on July 1 2009. This new system has been implemented as part of the Government's Social Inclusion Agenda, and includes a number of changes to activation policy, such as a redirection of investment towards the most disadvantaged (although overall investment has not increased) and an increased focus on skill development and accredited training (Commonwealth of Australia 2008). Assistance is provided in four streams with those facing the greatest barriers being assisted in Stream 4. Stream 4 aims to assist individuals to increase both economic and social participation and recognises both economic and social outcomes. Economic outcomes are paid directly and a quantifiable social outcomes measure is under development, but is not expected be ready for use until 2012. In the mean time participation in work experience and providing an additional 6-months assistance are being used as proxy measures for social outcomes (DEEWR 2009), neither of which are likely to be adequate. Mutual Obligation has been retained; however the punitive nature of the system has been significantly reduced (Perkins 2008c). Although there is not yet sufficient evidence to draw conclusions, Stream 4 appears to have a greater capacity to support social inclusion than existed under the previous system.

The Rudd Government has also endeavoured to wind back some of the deregulatory labour market reforms of the Howard era with the enactment of the Fair Work Act 2009 (Cth). However, it will be some time before we know whether this legislation will lead to an increase in job quality or greater compatibility between labour supply and demand.

Improved integration

In addition to optimising the operation of activation programs internally, there is also a need to recognise the limits these face in working with individuals rather than overcoming structural causes of exclusion. While activation policies have an important place in reducing social exclusion, these need be part of a larger integrated approach.

In particular, welfare to work programs will always operate within a broader labour market environment shaped by labour market regulation and institutions that play an fundamental role in determining the inclusionary potential for employment overall. In this regard activation policies need to be integrated with labour market policies that facilitate the creation of what is described by EU as an 'inclusive labour market'. This involves the provision of decent wages and conditions, but also extends to other rights such as the right for parents or carers to request part-time work thus supporting opportunities for combining work, learning and caring (Raveaud 2002).

The recognition of the need for activation policies to be integrated with labour market policies, but also broader social policies, is recognised in the recent EU development of the concept of 'active inclusion'. This attempts to achieve a holistic approach across three core areas: minimum income schemes, access to basic services, and financial and non-financial activation. This approach aims to provide income support at a level to enable a dignified life, with links to the labour market via employment assistance and training, and better access to enabling social services. The approach has an employment goal but also aims to ensure that those who can't work are able to live with dignity and contribute to society (Peters 2007). Similarly, the Brotherhood of St Laurence has called for the adoption of a model of social inclusion in Australia that integrates activation policies with policies related to wages and working conditions, transfers and taxation, and social services (Perkins 2008d).

Although, the new Job Services Australia has included activation programs within a Social Inclusion Agenda, it is not yet clear that this has led to greater integration between social and labour market policies and regulation in reducing exclusion.


Participation in paid work has an important place within the social inclusion discourse as a dimension of participation in its own right and as a mechanism to reduce exclusion. However, in practice social inclusion agendas such as Australia's seem to prioritise paid work over other forms of participation and view paid work as the sole path to inclusion, in line with Levitas' Social Integration Discourse. This risks losing core elements of the social inclusion approach including the multi-dimensional perspective, emphasis on joined up policy responses and dynamic outlook.

As a result of the emphasis on paid employment, activation programs have become a key social inclusion policy response with the aim of boosting employment participation of those at risk of exclusion. However, although some synergies exist between the social inclusion and activation discourses in other respects they may not always be compatible.

Evidence suggest that activation programs do not always support social inclusion of those at risk and that in some cases they may contribute to further exclusion, although the impact is highly dependent on the particular activation variant. The ability of activation programs to better support social inclusion can be improved through changes such as:

* using a broad definition of participation

* ensuring policies focus on both income and participation

* recognising the multidimensional nature of problems and responding with multidisciplinary interventions

* a long-term focus that supports sustainable employment outcomes as well as career development and advancement

* a greater emphasis on the quality of the employment placement and match with individual capacities and preferences

* the use of effective social participation measures

* a lenient compliance system

The potential for activation programs to support social inclusion will also be closely linked with the broader labour market context, and the extent to which this supports the creation of jobs with good wages and conditions at the lower end of the labour market. Integration with a broader social inclusion agenda in other policy areas such as social services and the tax and transfer system is also essential. Adequate services in areas such as physical and mental health, housing, transport, education and training, and life long learning are particularly important in supporting economic and social participation amongst highly disadvantaged unemployed people. As Paugam (1995: 71) argues, the social inclusion approach requires 'a simultaneous and dynamic attack on the weaknesses of the education system, on the failings of professional training, on the voids of employment and housing policies and on the excessive social disparities'. It remains to be seen whether the Australian Social Inclusion Agenda and related policies can meet this challenge.


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Author affiliation:

Daniel Perlons is a Senior Policy Advisor in the Victorian Department of Health. Before taking up this position, Daniel worked as a Research and Policy Manager in the Research and Policy Centre of Brotherhood of St Laurence. His work has focused on Australian and international employment programs to assist job seekers facing personal barriers, and the conceptual underpinnings of activation and social inclusion policies. His work has been published in refereed journals, book chapters, and organisational and government reports.

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