This report outlines key findings from a successful trial aimed at improving the uptake of wage subsidies through the use of behavioural economics.
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The trial was a partnership between the Department of Employment (now the Department of Education, Skills and Employment), the Behavioural Insights Team and the Workforce Australia provider Mission Providence and tested a variety of methods (or interventions) to increase uptake. The trial ran from July 2016 to October 2016.
The interventions were informed by key behavioural economics principles and were evaluated using a randomised control methodology. The interventions did not vary the overall financial parameters of the program and could be scalable at low cost. The changes focused on:
- using simpler and more accessible language in documentation provided to employers (e.g. the wage subsidy agreement, promotional flyers and correspondence);
- moving the wage subsidy agreement online;
- front-loading payment instalments; and
- giving staff access to a user-friendly payment calculator.
Feedback received during the trial fine-tuned the final design and implementation of the operational policy changes to wage subsidies announced in the 2016 Budget and implemented nationally on 1 January 2017.