Almost half of all people using employment services in Australia received threats to suspend their payments in the last quarter, new data has revealed. The Department of Employment and Workplace Relations (DEWR) reported a 23% increase in payment suspension notices issued by Workforce Australia, with 618,000 issued from July to September 2025, up from 504,000 in the previous quarter.
Of these notices, 290,000 resulted in a temporary pause of payment, affecting nearly half of all employment services participants. First Nations people were disproportionately impacted, with 52% of those with a provider experiencing at least one suspension in the quarter. The suspensions occur under Centrelink's mutual obligations regime, which requires recipients to actively look for work.
Advocates have called for a pause in suspensions until the government ensures the targeted compliance framework (TCF) – the automated system that runs mutual obligations – is operating lawfully. The commonwealth ombudsman recently found that DEWR was not maintaining effective oversight of employment providers, with the majority of provider decisions being overturned. In an earlier report, the ombudsman found 964 jobseekers had their payments unlawfully cancelled between April 2022 and July 2024.
Kristin O'Connell, spokesperson for the Antipoverty Centre, described the numbers as 'shocking', noting that the government continues to allow penalties despite legal uncertainties. Just 11.7% of jobseekers found long-term employment through a job provider in the latest financial year, at a cost of $750m to taxpayers. The largest for-profit providers received $300m in outcome payments, regardless of whether clients found jobs independently.
Dr Cassandra Goldie, chief executive of the Australian Council of Social Services (Acoss), said the system was failing to meet its own employment targets and that provider decisions were often overturned. She called for an independent quality commission to ensure accountability. The ombudsman's report highlighted that about half of private provider decisions were overturned, but not before people lost vital financial support.
