EXPLAINER

How would Labor's cash incentive to get people vaccinated work?

Labor Leader Anthony Albanese wants to pay people to get the jab. Picture: Elesa Kurtz

Labor Leader Anthony Albanese wants to pay people to get the jab. Picture: Elesa Kurtz

Labor has proposed a $300 payment to persuade people to get fully vaccinated. The cash incentive would go to everybody who has had the two jabs by the beginning of December.

"This support would be a further incentive for Australians to be fully vaccinated and would deliver a much-needed shot in the arm for businesses and workers struggling from lockdowns made necessary by the Morrison government's failures with the vaccine rollout," Labor Leader Anthony Albanese said.

Is it a revolutionary idea?

Incentives are not new.

Parents who want to put their children into childcare already have to get those children vaccinated or lose tax benefits. Under "No Jab No Play, No Jab No Pay", parents of unvaccinated children don't get the Family Tax Benefit or financial help with child care fees. And childcare centres won't accept unvaccinated children anyway.

Governments have been putting plenty of money into people's pockets to stay employed and providing travel vouchers go on holiday. Why can't we pay people to get vaccinated?

Professor Anthony Scott

Victoria offers $250 to some people on benefits to shop for the best electricity and gas deal.

Some other countries offer cash to families when children attend school or get health check-ups. The research indicates that the health of the wider community improves, and not just that of the families directly getting the cash.

And in America

Incentives are rife. In New Jersey, under the "shot and a beer" program, those who get vaccinated against Covid get a free beer. President Joe Biden liked the idea: "That's right, get a shot and have a beer. Free beer for everyone 21 years and over to celebrate independence from the virus."


More conventionally, he announced free trips to and from vaccination sites.

In Ohio, there's a million dollar pot to be shared by five vaccinated Ohioans who win a lottery. No jab, no entry. West Virginia has also gone down the lottery enticement route.

And in New York, there's a ticket to the ball game, either the Yankees or the Mets.

Do incentives work?

When the vaccines appeared in Australia, there was little gain to getting a jab. Unvaccinated Australians seemed safe from infections compared with people in other countries.

"Why should people bother to get vaccinated now if they can't travel anyway until mid-2022 or later?" as Professor Anthony Scott of the Melbourne Institute of Applied Economic and Social Research put it.

"Governments have been putting plenty of money into people's pockets to stay employed and providing travel vouchers go on holiday. Why can't we pay people to get vaccinated?" he asked.


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By and large, cash incentives don't seem to change long-term behaviour (like losing weight) but they have some effect when it's a one-off action (like having a vaccination or going to a clinic for a check-up).

Professor Scott thinks incentives should be targeted. Younger people, from the late teens to mid-40s on this definition, are more hesitant about vaccination than older people so cash could be pushed their way in return for a couple of jabs.


The research indicates that Queensland has a higher rate of "hesitancy" than New South Wales, for example, so incentives might be better spent there (though the outcry from those missing out on the money would be clear to the slowest political spin doctor).

Professor Scott said that about ten per cent of the population were out-and-out resistant to being vaccinated but a further 15 per cent were merely hesitant and perhaps persuadable with cash.

The mechanism is already there via Services Australia or the tax system, he said. Those who have studied giving incentives for health actions say that the reward should come soon after the action.

Sticks or carrots?

Banning the unvaccinated from work or travel or a venue may be more effective than giving them an incentive to get the jab.

"We know that losing something has more of an impact on behaviour than gaining something, and penalties like this could increase vaccination rates amongst those who are hesitant," according to Professor Scott.

"Losing our freedom to travel, to go shopping, or go to restaurants is something we all experienced during lockdown and do not want to experience again."

Vaccinated Americans can now travel to Britain so that may change the calculation about having the jab among some Americans.

Israel introduced a "green pass" which proved the holder had been vaccinated. It let the holder into places like gyms, concerts, hotels, theatres, restaurants and bars.

Politics

Some academics say that targeted programs work best - give the money to those who are reluctant in order to nudge them over the line.

But the politics goes against that. Those who have already been vaccinated might shout that they had lost out by doing the right thing.


Should the rich get a $300 payment? Leave anybody out and there'll be a row. Include everyone and there'll be a row.

The cost would be around $6 billion. Could the money be better spent? Professor Scott points out that the true cost is hard to estimate and might well be lower than the headline figure: if the money resulted in a higher rate of vaccination which prevented a serious outbreak, and all the economic disruption of a lockdown, the money might still be well spent.

And even if it is a good idea economically, might it work against Labor politically? Good economics - or good health policy - doesn't always mean good politics.


If, for example, the party were trying to counter an image of being too free with taxpayers' money, would the suggestion of cash for jabs play badly in an election? Nobody knows the answer to that.

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This story How would Labor's cash incentive to get people vaccinated work? first appeared on The Canberra Times.