Stewart McArthur (Corangamite, Liberal Party) Share this | Hansard source

I have listened very carefully to the member for Werriwa and I cannot fully understand the argument that he put forward except that he said that a number of Australians will be worse off. He had no argument against the Welfare to Work legislation that has been put forward by the government. I note his argument is in contradistinction to the former member for Werriwa, who was very strong on these issues and who wrote quite extensively about welfare to work. In fact, I think he would have agreed with the government’s position, unlike the current member for Werriwa. He ought to have a chat to Mr Latham about what the good, long-term future should be on the welfare to work issue.

I also note the presence of my good friend the member for Throsby and I will be interested in her point of view as she argues the case on behalf of the opposition. I am pleased to contribute to the debate on the Employment and Workplace Relations Legislation Amendment (Welfare to Work and Other Measures) (Consequential Amendments) Bill 2006. This is a bill providing consequential changes as a result of the introduction of the federal government’s important Welfare to Work policies that were passed through this parliament last year and which I spoke to on that occasion. The Welfare to Work policies are an important element of the Howard government’s strong plan to assist families and to keep our economy strong and our nation secure. The government’s Welfare to Work policies and our industrial relations reform are all part of a considered long-term plan to build a better Australia and provide enhanced opportunities for working families and for people who have the capacity to work but who are currently out of work.

In general terms, the Welfare to Work measures introduced by the government last year encourage and assist more people of working age to participate actively in the workforce. A couple of principles underline these measures. Firstly, people who have the capacity to work and are able to work should do so. That is different from the member for Werriwa who argued that 100,000 people would be disadvantaged. I think that nobody in Australia could argue with that first principle. Secondly, the best form of family income comes from having a job rather than welfare. I am sure the shadow minister for immigration at the table would agree with that because he has had a bit of first-hand experience of those situations. For people, having a job rather than being on welfare means more than receiving an income. By being meaningfully employed, a person gains an improved sense of self-worth and dignity from making a contribution to our society and undertaking an activity that is valued by an employer. People who are in employment also have greater control and security over their own life and are not reliant on government agencies. During my contribution to the Welfare to Work legislation debate last year I noted some statistics which highlight how vital it is for the government to act to assist people of working age on welfare into employment. Again, this is contrary to the view of the member for Werriwa, who was talking about those who were disadvantaged. We are actually trying to get people back into the workforce rather than letting them stay on welfare.

It is appropriate to reiterate these points. Australia’s welfare state has grown immensely over the last 40 years and without reform is fast approaching an unsustainable position. Even those opposite would agree with that—the member for Throsby would agree with that if she looked at the figures. You cannot continue to have the workers of Australia sustaining the welfare state as in the UK and other welfare nations. In June 2005, if you look at the figures, we had 705,000 working age Australians who were on disability support—I reiterate, 705,000. We had 630,000 working age Australians on parenting payments, of which there were 450,000 single parents and we had 500,000 working age Australians on unemployment benefits. We know that that is a very low figure, about 5.1 per cent of the population. If you look at the actual figures spent on disability, you see in 2004-05 spending on the disability support pension exceeded $10 billion. Governments of all colours and those opposite, when they eventually reach government—Mr Deputy Speaker Hatton, you might eventually be there; maybe when I have left the parliament—will have to look at this issue very carefully.

The total welfare budget for the current year, 2005-06, is $60 billion. The parliament needs to take a very careful look at this figure. The major challenge for our country is the fact that, in these prosperous economic times when unemployment is at the lowest level for a generation—as I mentioned before, a 5.1 per cent unemployment rate in April 2006—one in five people of working age is on welfare. Again, I wonder what the member for Throsby will say about that. A total of 2.6 million people out of 13.7 million Australians aged between 16 and 64 years are welfare dependent. That is a very disturbing figure for everyone in this parliament. It is disturbing that we would encourage this welfare dependency and the government is trying to make a change of attitude and approach to this very difficult problem.

Unless checked, such a high level of welfare dependence will have lasting impacts on future generations. Already it is estimated there are 700,000 children growing up in homes where neither parent is in employment. There is a risk in such families that a culture of not working could be created and handed down from one generation to the next. Members in the parliament are aware of that particular scenario. We do have families of three and four generations who have not had a working person in their living families.

In the interests of equity for all Australians, it is vital that the government acts to break the chain of intergenerational poverty and unemployment and to encourage people back into the workforce. It is in this context that the government has acted positively to assist people who have the capacity to work to move out of welfare and into meaningful employment through our Welfare to Work provisions. In particular, the government’s Welfare to Work legislation will address the situation of people who are on the disability support pension—and there are now more people on the disability support pension than there are people on the unemployment benefit. Once people get on the disability support pension, they could stay on the pension for life, irrespective of their ability to work. The most common problems reported by disability support pension claimants are bad backs, feeling stressed and like problems such as musculoskeletal ailments. If you look at the figures, I think it is 34 per cent of recipients who have these hard to diagnose psychological and psychiatric difficulties.

As an active local member in Corangamite, I have visited the local Centrelink office and have inspected some of the forms that disability support pension claimants must sign. Once the box is ticked for the disability support pension for a sore back or a psychological or psychiatric problem, it is very difficult for the administration of Centrelink to check on those individuals to see whether they might have some remedy for those ailments, such as the musculoskeletal—the technical word for a sore back—and to make a judgment as to whether this person has been restored to reasonable health. I think those opposite looked at those problems when they were in government some time ago. However, in many cases people who are on the DSP, especially at young ages, have a capacity to work and it is appropriate that, where this is the case, these people are encouraged to undertake some work. They are not being disadvantaged; they are just being encouraged both financially and by some of the tests to look for work.

The Welfare to Work measures also help encourage single parents on the parenting payment single and those parents on the parenting payment partnered to seek part-time work once their youngest child turns six years old. This is an important measure to help reintegrate into the workforce, in a considered way, those parents of children who are in schooling. These reforms the government has introduced, which were passed through the parliament last year, are important to help assist working age people back into the workforce, to break the cycle of intergenerational welfare dependence and to ensure the national welfare system remains sustainable going into the future. I emphasise the point to both sides of the parliament that the welfare system should be sustainable over time and that if a government does not address the problems of welfare they become almost impossible to fix. I think we have seen that situation arise in the United Kingdom.

The measures in this bill will extend eligibility for certain government benefits to persons not currently eligible to ensure that government payments for working age persons and full provisions of the Welfare to Work policy are consistently applied. Again, the administration of this is important. The minor changes introduced in this bill will cost the government a further $4.8 million over four years. The bill will allow parents who receive the parenting payment partnered who have a temporary incapacity exemption to gain access to the pharmaceutical allowance. In recognition of the impact of the death of a child on parents, the bill will also allow single parents who are receiving the Newstart allowance or youth allowance to continue to receive the same rate they were receiving before their child died for another 14 weeks after the death of the child. The government is trying very hard to accommodate some of the human problems that some of the people on these pensions encounter.

Another assistance measure extended in this bill is designed to help people with the costs associated with commencing employment by extending the employment entry payment. Income support recipients who have breached compliance with activity requirements—that is, people who are subject to a non-payment period—under this bill will still be eligible for the employment entry payment if they find and commence employment or increase the number of hours of employment during the non-payment period. This is a sign of the Howard government’s commitment to assisting people to make the transition from welfare to work. It is a relatively small point, but it does show that some of the changes that we have introduced in this bill before the parliament do assist people to make that sometimes difficult move from welfare, where they collect their money every two weeks, back into a job. That is sometimes quite difficult to achieve, and we are trying to make that transition as easy as possible.

Earlier in the week the Treasurer, Peter Costello, handed down the budget, which has been very well received, as all members understand, by commentators and by the community. The budget will help Australian families with the challenges they face in meeting household costs and planning for their future. The budget delivered personal income tax cuts, enhanced family assistance payments and substantial reform and simplification of our superannuation arrangements. The budget also funded important investment in national infrastructure, including roads and rail networks, which are so vitally important to facilitate the movement of freight around Australia. Efficient transport infrastructure helps our industry to be world competitive, encourages investment and jobs growth, and ultimately lowers transport costs and therefore helps to pay for the price of essential goods.

The economy is in good shape. That helps with this bill before the parliament. These reforms, the tough decisions of the past 10 years and the hard, disciplined work of the Howard government have allowed the Treasurer to deliver a budget this week which cuts tax, provides additional assistance to families and invests in infrastructure so that we are better prepared as a nation to meet the future challenges of an ageing population. Just as the government’s past reforms have allowed the delivery of a positive budget, so will the government’s Welfare to Work policies—in conjunction with other elements of the Howard government’s plan, such as our Work Choices industrial relations reforms—be important in helping the economy to continue to grow and to deliver more positive budgets next year and the year after that.

I take the opportunity while speaking on this bill to commend the Minister for Employment and Workplace Relations, my good friend and colleague the Hon. Kevin Andrews, not only for his work in drafting and guiding through this parliament the important reforms—such as Welfare to Work, which we are talking about now, and the Work Choices industrial relations reforms—but also for moving around Australia trying to prepare businesses to implement the reforms in the community to generate job opportunities for unemployed Australians.

Recently, the minister came to Geelong and Corangamite and spoke at the Workforce Tomorrow Industry and Employer breakfast. He was there demonstrating and arguing the case for these transitions for the new industrial relations changes, which I am sure the member for Throsby will embrace in her speech. She is very supportive of these changes. As she sees the light and understands the value and importance of these industrial relations changes, eventually she will understand the merit of the case. If she had been in Geelong, she would have understood the importance of these changes and the advocacy of the minister.

The minister told the meeting that labour market research conducted last year predicts that Australia will face a potential shortfall of 195,000 workers over the next five years. Even the member for Throsby would understand that if we are short of workers that is going to be a problem for industry and the workforce. The ageing population is expected to steadily apply a brake on the potential growth for all major occupational groups forecast to be adversely affected. This will happen even in Corangamite. The minister told the meeting that businesses across the Barwon region would be nearly 3,000 workers short by 2011. That is not far away and businesses will be suffering from not only the shortages of skills but also the actual availability of workers.

In this context Geelong’s employers were told they would face an increasingly limited labour supply and that businesses would need to focus more on the recruitment and retention of workers. Importantly, the point was emphasised that businesses will need to look to recruiting and training people from the Geelong region who would be encouraged to leave welfare and enter the workforce as a result of the government’s Welfare to Work reforms. We see on the ground in Corangamite and in Geelong that these important reforms will assist local businesses and assist people to go back into the workforce because they will be needed and they will be appreciated for their contribution.

The Minister for Employment and Workplace Relations told the meeting that there were 32,000 working age people in the Geelong region in December 2005 who were in receipt of allowances and pensions—more than one-fifth of the civilian working age population. Again, in my own home town, we have this large percentage of working age population who possibly can go back to work and are receiving allowances and pensions. If employers want to remain viable and competitive and want to continue to grow, they will have to look towards recruiting sole parents and disabled people who are on the disability support pension to meet their workforce needs.

I personally have been very supportive of the Karingal organisation. They have done a fantastic job with some of the local employers in the Geelong region in encouraging some of those people with some disability to go back into the workforce and to receive some payment for their activities. I commend Karingal and some of those companies which have done such a good job in encouraging those people to go back to work, although they are suffering some form of disability.

I commend this legislation. I commend the thrust of the Welfare to Work legislation that has been before the parliament, both on this occasion and on previous occasions. I think this measure and the philosophic thrust of the policy behind it is very important for both sides of the parliament. In the longer term for Australia we will be encouraging people who have some disability, who have some perceived difficulty, to do what they can to get back into the workforce, to reduce that welfare bill and to have an attitude of mind that here in Australia we will not have forever a ballooning welfare bill. I commend the bill, I commend the policy and I hope those opposite will support the broad thrust of the elements of this bill and the policy behind it.

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