Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1694232415439.pdf (Australia)
Social protection and the future of work – key points • Changes in the nature of work and labour markets potentially pose new challenges to the social protection systems of high-income countries, particularly those relying on contributory social insurance systems.

These systems are based to varying degrees on workers satisfying contribution conditions that require or assume full-time engagement in paid work for the majority of years that individuals are of labour force age.
• As temporary work and changing employment contracts become more prevalent, the assumption of full-time, permanent formal employment threatens to become less common, potentially undermining welfare state finances as well as the social protection of workers and their families.

• • In Australia, the government social security system, community services and public health insurance is not based on contributory social insurance principles but is financed from general government revenue.
This does not necessarily mean that we do not face similar challenges.

In particular, in Australia many forms of social protection have been associated with conditions of employment, including a relatively high minimum wage, paid sick leave (also now available for care responsibilities), paid holiday leave, paid parental leave, workers compensation and – more recently - superannuation.
Changes in employment conditions could potentially undermine these provisions, with implications either for the security of households or costs to government, because of “risk-shifting”.

• While the Australian social security system does not require explicit contributions, spending requires appropriate tax levels to be financed.

If changes in future work patterns undermine adequate revenue collection, social protection may be put at risk.
• A further difference from most other OECD countries is that the Australian social security system is highly income-tested.

The administration of income-testing becomes much more complicated if patterns of work become irregular or other circumstances, such as multiple job holding become common.
• The main risk to employment conditions commonly discussed is changes in automation, robotics and AI with projections that this could lead to the loss of between 10% and 50% of current jobs over the next two to three decades.

• Digital platform jobs also potentially undermine employment conditions and wages but are currently a very small proportion of employment – 1-2% in Europe and the USA.
• Australia has already experienced very significant changes to work patterns over the last forty years, and we currently have one of the highest levels of part-time employment in the OECD, the highest level of underemployment in the OECD and what appears to be the highest level of non-permanent employment in the OECD.

• A well-known option for dealing with these changes is the introduction of some form of Universal Basic Income or Unconditional Basic Income.
I am not in favour of this approach, but argue that there are a range of more realistic options that could be considered including improving the adequacy of payments for people of working age, adapting income tests to be more appropriate to changing work conditions, significantly modifying the liquid assets test waiting period, and reducing benefit conditionality.
• More research and Australian data is needed on within year changes in employment conditions and earnings to identify this aspect of income volatility.

Senate Select Committee on the Future of Work and WorkersSubmission 155 - Attachment 1