THE government is making a lot of noise about welfare payments.

It sent out new Social Services Minister Christian Porter to imply he is set to make grand changes. Mr Porter wants you to believe he will root out all Australia’s bludgers and promptly send them off, to dig holes or stack shelves with groceries, etc.

Many people believe that will reshape Australia.

But the dole bludger is a creature a bit like the Tasmanian Tiger. People claim they saw one, but their continued existence is largely a myth.

The government claims to be going on a Tasmanian Tiger hunt, and when it comes back, having shot all its bullets, we should ask who it was really shooting at.

The reality is that getting a job is very hard right now. Abundant jobs just aren’t out there, especially for younger and older Australians.

Australia has 800,000 people on Newstart payments (i.e. the dole), but for the vast majority it is not a long-term proposition.

Half of all unemployed people find a job within 10 weeks. More Australians receive Disability Support Pension, and far more get the aged pension. (Some people claim the Disability Support Pension is the new home of the bludger, but getting the payment and staying on it is actually perfectly consistent with actually being incapacitated).

The government claims the total lifetime cost of our welfare system is $4.7 trillion. But anyway, the majority of those trillions has nothing to do with dole bludgers, or what Joe Hockey calls “leaners”, or people on disability support.

The majority of it is people who worked their whole life, paid a great deal of tax, and now get the aged pension. The red bar in the graph below is the aged pension.

The green bar in the graph marked “B — IS Working Age” shows Income Support, which includes Newstart (the dole) alongside sickness allowance and various supports for people studying and working. It is not even in the top three.

ONCE IN A LIFETIME

The government’s big new trick is to add up the lifetime cost of welfare payments. It seems to be operating on the basis that if you get people off welfare now, you can keep them off welfare in the future too.

They seem to imply past welfare is the cause of future welfare. Is this the case?

If you look at the data, some of the people who were on welfare in the past do tend to be on welfare in the future. This chart shows what happens to 15-year-old females receiving parent payments. Very few of them move into group 10 — Previous Welfare recipient.

The PwC report the government is relying on says this:

“Particular groups of interest are young parents and young carers — although these do not represent large numbers of the population, they are at particular risk of remaining reliant on welfare.”

This case is a fine example of why you need to be careful interpreting data. What we have here is a confounding factor. What drives future welfare is not the payments. It is most likely the presence of a child to raise, not to mention the interruption to schooling that is likely to happen when you give birth age 15.

Take away that woman’s welfare and what do you get? I strongly doubt it is going to be a happy woman and a well-fed baby that goes on to thrive. America has tried this system and there poverty is entrenched.

Half of all Aussies have received a welfare payment at some point and some of them have got more than one. The other, luckier half might feel they are entitled to expect more. But I disagree.

As it happens, I’m in that lucky half. But while I have never got cash, the government has given me a huge amount of other things — many years of education, lots of free doctors visits and one lifesaving hospital trip, free use of lots of roads, etc, etc.

If I got on my high horse and said, well, the government never gave me anything I’d be a massive hypocrite.

Nobody likes the idea of people taking their taxes to bludge on the dole, so the government emphasises that. But so few people are really dole bludgers that that is not the point. What is most likely to happen is crimping payments that keep very vulnerable people out of the deepest poverty.

The government has said it is going to use pilot programs to try out changes it makes on a small scale first. We can only hope it honestly pays attention to the real effects of the changes.

Jason Murphy is an economist. He publishes the blog Thomas The Thinkengine. Follow Jason on Twitter @Jasemurphy