Kelvin Thomson (Wills, Australian Labor Party, Shadow Minister for Public Accountability and Human Services) Share this | Hansard source

I do not intend to speak at any great length on the Financial Framework Legislation Amendment Bill (No. 2) 2005, but I want to say a couple of things. The first is to support the remarks just made by the member for Melbourne concerning the issues of accident compensation and compensation for injured workers. I think everything the member for Melbourne has said about the unsatisfactory nature of the present system is correct. There is something of a lottery if you are injured. If you can show that someone—whether it is your employer, a council or an education department—is responsible for your injury then you can on occasion receive very large and generous compensation for the injury or the illness. But, on the other hand, if you cannot show that it was somebody else’s fault, and that somebody has deep pockets, you are put in the position of dependence on the disability support pension and in many cases that is inadequate.

I can remember in years gone by that a particularly unsatisfactory feature of the existing regime was that payouts were almost universally by way of lump sums, and frequently people who received these lump sums for very substantial injuries had them managed by others and found that they had become lost, stolen or mismanaged and turned into nothing. I can remember when I was shadow Assistant Treasurer and had some responsibilities in the area of insurance pursuing this issue. There was a case in Geelong where a young man had very serious injuries as a result of negligence by a hospital and had received a payout in the order of $7 million. Unfortunately, his Geelong accountant had taken something like $6 million of that $7 million and got rid of it at the Crown Casino. He was, of course, charged with theft et cetera. But it was a very unsatisfactory example of the way in which the lump sums could disappear or be maladministered. I and others at that time put pressure on the government for a change to the taxation legislation to encourage people to take these settlements by way of periodic payments rather than lump sums. I am pleased that the government, under some duress, acted in that direction and that we now have a situation where it is easier to have your compensation payment made by way of periodic payment rather than lump sum.

One of the interesting postscripts on that Geelong case was that this young man’s injuries were so severe that within about 12 months of my visiting him he passed away. The truth is that, had the theft not occurred, that $7 million would have been an excessive amount of compensation; it would have been a windfall to the family. So there are people on one side of the existing legal arrangements who can get quite generous compensation and people on the other side of the arrangements who lose out in the lottery, receive very little compensation and are put in very serious positions as a result of workplace injuries, transport injuries and other injuries.

There are schedules in this bill which refer to the government’s welfare to work changes. I only wish to speak briefly on these matters. Not having had the opportunity, due to other commitments, to speak in the House on welfare to work issues previously, I want to take this opportunity to express my concern that the government is essentially, with these changes which are soon to come into effect, moving people from one welfare payment to a lower welfare payment. Sole parents in future, when their child turns eight, will be dumped onto the dole. The problem is that you actually lose more of every dollar you earn when you are on the dole than on the current payment. That does not act as an incentive to go out into the workforce and earn more money; that acts as a disincentive. I believe that people with a disability will be even worse off. They are currently on the disability support pension. In future, if they are assessed by someone in the department as being able to work 15 hours a week, they also will be dumped onto the dole and thereby take a significant cut in their income. You have got to ask the question: if the government seriously believed that this was a good idea, why wouldn’t they be doing it to the existing 700,000 disability support pensioners?

I note that one of the Liberal MPs from Western Australia, the member for Pearce, Judi Moylan, has stated that there will be extremely adverse results for single parents and people on disability pensions. I think she is quite correct in her assessment of this. It is a shame that the government has not taken more notice of her. I want to put on the record my concern that this precisely will be the outcome of the government’s proposed changes. I am all in favour of mutual obligation and reciprocal obligations, but I believe that the way in which the government is approaching these welfare to work issues will simply result in reduced payments for people who are in that unfortunate situation.

Schedule 4 of the bill relates to the Job Network. I want to point out to the House that we have had an Auditor-General’s report on the Job Network tabled in parliament in June last year, which found that the levels of contact between Job Network members and jobseekers rarely met contractual obligations; that the assessment of jobseekers’ needs, a contractual obligation, was limited; and that customisation of jobseekers’ Job Search plans was very limited. The Howard government’s failure to ensure contractual obligations are met has had a very bad impact on those who are having the most difficulty finding work. The report gives some indication as to why it is that long-term unemployment has increased by 60 per cent over the past five years. The report found that the department lacks clear objectives and performance indicators relating to service standards, and indeed this seems to explain why complaints about the Job Network to the employment department’s customer service line have doubled in recent times. It is true that the Auditor-General’s report raises serious concerns about the Job Network’s capacity to manage the implementation of the so-called welfare to work package. In other respects I associate myself with the remarks made by the member for Melbourne.

See this speech in context