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The concept of the ‘social investment state’ refocuses attention on the productive function of social policy eclipsed for some time by the emphasis on its social protection or compensation roles. Here we distinguish between different social investment strategies, the Nordic ‘heavy’ and the Liberal ‘light’, with particular reference to the inclusive growth approach adopted in Australia. In 2007, social democrats in Australia returned to government with a clear mandate to reject the labour market deregulation and other neoliberal policies of its predecessor, and to tackle entrenched social and economic disadvantage in Australian society. For the last five years, social investment and inclusive growth has been at the centre of the Australian social policy agenda. Against this background, the article examines and critically assesses the (re)turn to ‘social investment’ thinking in Australia during Labor's term in office (2007–13). Analysis focuses not just on what was actually achieved, but also on the constraining role of prevailing economic and political circumstances and on the processes that were used to drive social investment reform. In many ways, the article goes some way to exposing ongoing tensions surrounding the distinctiveness of ‘social investment’ strategies pursued by leftist parties within the (neo)liberal state.

This study examined the quality of life of single mothers making the mandatory transition from welfare to work. The Australian government purported that the benefits of making this transition would include higher incomes, better social participation, and improved wellbeing. It is currently unknown, however, how single mothers currently engaged in welfare to work programs evaluate their quality of life. Quality of life scores for 334 single mothers engaged in welfare to work in Australia were compared with normative data. Participants reported significantly lower quality of life scores than the general population for all quality of life domains, highlighting the need to carefully examine welfare to work policies to ensure they promote participants' quality of life.