Labour-market regulations and welfare programs are significant features of Australia’s economic and social fabric. Many have been introduced with the laudable objective of ensuring at least minimal income levels for all Australians. Unfortunately, these regulations and programs frequently have unintended side effects that reduce the incentives and opportunities for people to look after themselves and improve their living standards. In extreme cases, these disincentives can be such that in the long run the well-being of people with low and underdeveloped labour skills may be reduced.
