Carrots or sticks? The Use of Incentives to Achieve Social Policy Goals in Australia

Abstract Using incentives to promote policy and program agendas has become an established strategy across various arenas of government intervention in Austrialia. A range of financial benefits such as tax rebates, concessions, refunds or discounts are widely used as inducements or ‘carrots’ to inerease compliance to government agendas. At the other end of the incentive speetrum, penalties such as inereased taxes, fines or social security benefit cuts are applied as ‘sticks’ to achieve policy directives. To date there has been little critical evalution of incentives used in social policy domains in Austrialia. In this paper we critically analyse ten initiaties in health and social policy which employed incentives to increase participation and compliance. Analysis revealed that incentives are highly targeted, centrally controlled and usually aimed at achieving short term or political goals rather than long term outcomes. Incentives are largely directed at changing individual behaviour and there are observed inequities in whether ‘carrots’ or ‘sticks’ are adoped in initiatives.