Federal Budget: $22M for jobs focused social enterprise

The Federal Budget represents a turning point for social enterprises in Australia after the government unveiled a new $21.9 million employment initiative that will see job-focused social enterprises funded to work directly with people with complex barriers, giving them the support they need to get back to work. 

Included in the Federal Budget as part of a $54 million commitment for a Paid Employment Pathways Package, the 'WorkFoundations’ program will support individuals back into employment through social enterprise and other suitable businesses.

It marks a pivotal moment for the social enterprise sector which has long been advocating for greater integration into the national employment services system.

White Box Enterprises CEO Luke Terry said it was fantastic to see the federal government recognising the role social enterprises play, and acknowledging the vital importance of the support these businesses provide to individuals who would otherwise be locked out of the workforce.

“This is major milestone for the sector,” Mr Terry said. “We know most mainstream employers aren’t equipped to provide the additional support needed to get long-term unemployed individuals engaged in meaningful work. But social enterprises are. They have a proven business model that creates jobs and contributes to Australia’s economy.

“Until now, they have been the missing piece in employment services. This announcement changes that. It takes us a step closer to being an integrated part of the employment system.”

There are currently more than 12,000 social enterprises in Australia, contributing an estimated annual value of $21.3 billion to the economy. These businesses provide jobs for more than 206,000 people, with about 58 per cent focused on employment services.

Work Integrated Social Enterprises (WISEs), also known as jobs-focused social enterprises, specifically focus on creating jobs for people shut out from mainstream work. They offer dedicated wraparound supports which differentiate them from other employers. But these support structures come at a significant cost.

Under the new program, which is set to run from 1 July 2025 to 30 June 2027, eligible businesses will be able to apply for funding to provide paid placements at full award wages with fully funded wraparound supports.

The initial phase of the program will allow businesses to build evidence-based reform.

It follows a five-year advocacy campaign led by White Box Enterprises, Social Enterprise Australia and others in the sector, for the inclusion of social enterprises in the employment ecosystem.

Mr Terry said data coming out of the existing Payment By Outcomes trial, the first federal government-funded trial paying WISEs for their employment outcomes, showed the potential of the model.

“Almost two years in, the success of this trial is now beyond question,” Mr Terry said.

“In the PBO3 Trial, social enterprises are significantly outperforming the DES system in employing and retaining individuals living with a disability who have been out of work for nine of the last 12 months.

“White Box Enterprises has been running this trial in partnership with the Department of Social Services with 132 placements. We anticipate this newly announced program will allow us to reach a much greater number of people facing barriers to work. That has the potential to have a huge impact on both the community and the economy.”

Mr Terry also thanked Minister for Employment and Workplace Relations Tony Burke for his longstanding support of the sector. 

“Minister Burke has shown he really understands the value of social enterprise and the difference it could make to the employment system if social enterprises were included,” Mr Terry said.

“We look forward to continuing to work with him and the federal government to explore how social enterprise can be activated as the employer of choice for individuals the system currently isn’t able to support.”

Read more about White Box's advocacy work for social enterprise under Innovate on our website.