09/05/2012 - 11:04

Simple solution to ending welfare cycle

09/05/2012 - 11:04


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More action is needed to provide meaningful work opportunities for indigenous Australians.

More action is needed to provide meaningful work opportunities for indigenous Australians.  

IN recognising Elders across Australia, past and present, and in particular, the Ngunawal and Ngambri people of this place, I want to draw your attention to a great elder of mine. He was known across his vast, red Yamaji lands as the senior lawman and his name in Yamaji was Elleewana. The son of a fine Scots man and a proud Australian black woman, he earned his name – Scotty Black. 

For more than 30 years, he was head stockman on Minderoo, my family’s sheep and cattle station. It was Scotty who taught me that Australian indigenous people could walk as easily in two worlds as any other people on earth. He was the equal of anyone I knew, and more often than not, better.

It was Scotty who, with my mum Judy, took me on my first muster when I was five years old, who taught me the deep respect I’ve always held for my elders, the camaraderie of friendship from people of all walks of life, and that it was never a matter of a person’s station in society, nor their colour, creed or language on which you judged a person. It was only a person’s values that had him or her stand as your friend. It was also Scotty who joined me to my family’s deep love for Aboriginal people.

So now, with the privilege of wealth and the ability to make a small difference, I am committed to honour the memory of Scotty Black, to combating the disparity between indigenous and non-indigenous Australians, to fight the welfare driven and thoroughly failed policies that have crushed the spirit of so many first Australians. 

Today, I see an Australia ever more determined to stop the squander of our precious wealth on the poison of welfare and to finally end the disparity that our indigenous brothers and sisters suffer. I have lost too many childhood friends like Scotty’s kids.

Their elders have always known that the solution is employment. That is only possible through training that leads to a job that, in turn, leads to dignity and self-respect. But too few have been listening. This is a life and death issue and people are dying because of this disparity every day. 

And while other Australians can choose, it is glaringly obvious to me that this is the biggest moral issue facing Australia. We no longer have the excuse that Australians don't wish to employ our first Australians. We now have the weapons: the companies wanting to employ Aboriginal people, the tens of thousands of jobs, and the attitudes of all Australians to end the disparity and not tolerate it for a moment further.

Let me be clear; this will not be achieved with the continuation of current policies, which the head of the Australian Employment Covenant, Rhonda Parker, recently described as ‘the roundabout of failure’. 

We can, we should, and we must destroy the disparity within our generation.

Let me explain. We now have: 

• 250,000 members of Generation-One, all of them demanding the government move from welfare to employment as the keystone of Indigenous policy, 

• 330 proud corporate members of the Covenant, companies representing their employees wishing to make their own personal contribution of working with and continuing the training of an Indigenous person. They range from the smallest to the largest of Australian employers. 

• And, we have more than 61,000 jobs committed to Aboriginal people. 

These unprecedented achievements were accomplished by the Covenant employers and GenerationOne members. They are offering to Aboriginal people a passport to an independent future. 

When the Australian Employment Covenant was signed by former prime minister Kevin Rudd in October 2008 it had three critical parts. The first was the promise of 50,000 job offers for indigenous people, the second was the indigenous people stepping up to take the training for those jobs and the critical third was the government providing job-specific training for these guaranteed jobs. 

It is the greatest disappointment to me that while the employers exceeded their commitment to roll out 50,000 job offers and while Aboriginal people, 10,000 of them, have taken these jobs, the government has failed to meet its obligation to the critical third of the covenant.

This concept is very simple: training directed by the employer for the employer because it is only the employer who will offer the jobs.

Last week, the government announced a new model for jobs for remote Australia. It was good news and an important step in the right direction. And the government also had some encouraging words about the success of our approach – the Vocational Training and Employment Centre model. But it has overcomplicated the pathway to ending disparity. The reform that this people, this country and this economy are waiting for is very, very simple. 

My strong recommendation to the government is that not one more dollar be spent on indigenous training – including Job Service Agencies (JSA) and Indigenous Employment Programs (IEP) – unless attached to a real job commitment by a participating employer.

Now, I do not want to detract from the hard work of ministers Macklin, Shorten and Collins, nor that of the hundreds of companies providing jobs to indigenous people. Many of the 10,000-plus placements by the covenant employers were supported by IEP assistance at a cost of more than $130 million.

Along with the story of success that comes with the announcement of 10,500 people moving into employment, a tale of frustration for employers and indigenous job seekers is told. Employers report that for every one job filled, two go unfilled due to a lack of available, job-ready indigenous applicants. 

The jobs are there – AEC employers are doing a fine job of converting their commitments into real jobs. But one key point must be foremost in the minds of would-be reformers – the employers created the jobs and employers designed the training for the indigenous workers. There was no training for training’s sake, and none of this money was wasted.

Now that we have the jobs waiting, the employer-driven, job-specific training becomes urgent. Any training not attached to a guaranteed job risks joining the long record of billions of dollars wasted by consecutive governments. And we all know that billions of dollars have been wasted.

Let me repeat: No government money for programs that are not connected to jobs. We have in our hands the policy power to refuse to continue training for training’s sake and we must use it.

The covenant employers achieve over a 70 per cent retention rate at six months with indigenous staff, while the government’s JSA system achieves only a 45 per cent retention rate at three months. The unacceptable JSA roundabout of failure for indigenous job seekers must stop. 

I am proud of the company that I founded, proud of the employment opportunities that it has created, proud of the wealth it is creating for Australians and especially proud that my company runs training programs for Aboriginal people which train them to be job-ready and guarantees a job once they successfully complete that course.

We didn’t invent employer-directed job-specific training, and we certainly haven’t perfected it. However we have unleashed the power of training for the most disadvantaged and delight in watching them flourish in their new careers.

We call it Vocational Training Employment Centres. The VTEC matches trained employees to jobs. Now we need 25 VTECs across the nation to operate as pipelines to employment to abolish the disparity.

FMG employs more than 350 Aboriginal people – over 10 per cent of our total workforce. They do real jobs with considerable career prospects. If we add on the additional 550 people employed on our projects with our contractors, we have 900 Aboriginal people working on Fortescue operations and projects.

That figure represents a quarter of our total workforce. More than 1,000 men and women have been through Fortescue’s indigenous training program and the vast majority is now gainfully employed.

And that isn’t the end of the matter. We place Aboriginal trained workers with Aboriginal contractors. Fortescue is also committed to building business capacity giving them the opportunity to create more jobs. We have a target of achieving $1 billion of contracts to Aboriginal-owned businesses by the end of 2013 and we have already awarded over $350 million. 

We have proven the impact of the VTEC approach. There is no reason willing employers should wait years to benefit from an improved, streamlined process to prepare indigenous job-seekers who add value to their employer from their first day at work. 

Our underlying premise is that mining welfare should not replace or compound government welfare because it perpetuates a vicious cycle of poverty and dependence.

I will personally commit to the success of any VTEC the government supports to meet its AEC training covenant, and if invited, travel to and coach each and every one of them. 

We have an opportunity without precedent to end the indigenous disparity. Companies across Australia, like Fortescue, are crafting employer-driven, job-ready training programs. They are experiencing unparalleled success in placing and retaining Aboriginal employees who add value from their first day at work. 

But without adequate leadership, the pull and poison of welfare and the refusal to abandon failed programs threatens our progress. Billions of dollars could be saved and additional billions could be generated as welfare recipients become taxpayers. 

My very strong recommendation to the government is that no more indigenous training and related expenditure including JSAs and IEPs is funded, unless attached to a real job commitment by a participating employer. The social benefits of employment are immeasurable. Missing this opportunity would be unforgivable.

• This is an edited version of FMG non-executive chairman Andrew Forrest’s address to the National Press Club in Canberra last week. 


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