Craig Emerson (Rankin, Australian Labor Party, Shadow Minister for Service Economy, Small Business and Independent Contractors) Share this | Hansard source

The Employment and Workplace Relations Legislation Amendment (Welfare to Work and Vocational Rehabilitation Services) Bill 2006 rectifies a number of mistakes and in the process makes some grave new errors. I think it is a reflection of a government that is tired and has lost its way. I will explain that remark by reference to the policy contained in this legislation, the pensioner education supplement. I want to concentrate my remarks today on that supplement.

There are parts of this legislation that we support because they rectify past mistakes, and it is certainly worth doing that. But the fact is that a most remarkable, callous, even brutal, measure has managed to pass through the federal cabinet, obviously with barely a whisper. Indeed, the second reading speech, which runs for all of six paragraphs, shows us the contempt with which the government is treating this parliament. Through this legislation the government seeks to deny disability support pensioners who are in the transitional phase, as the government implements its Welfare to Work measures, access to the pensioner education supplement. You would think that the second reading speech at least would provide a defence or an explanation as to what the government is doing. There is no mention of it. There is no mention of any kind of rationale for this policy of denying a group of disability support pensioners access to the pensioner education supplement. So I thought we should have a look at the explanatory memorandum. That does make reference to it:

Items 21 and 28 make it clear that people who claim DSP between 11 May 2005 and 30 June 2006 who were qualified for the pensioner education supplement and who move to newstart or youth allowance, will only be able to continue to access the pensioner education supplement, if they no longer qualified for DSP as a result of their first DSP review after 1 July 2006

As clear as mud! But at the heart of this policy is a callous decision made by the Howard cabinet to deny the pensioner education supplement to a category of disability support pensioners. We ask: why? Why would you do that? Is this just a gratuitous measure, or would it save the Commonwealth a lot of money? If it would in fact save the Commonwealth a lot of money it would be worth considering whether there are net benefits. At least there would be some benefit in saving the Commonwealth money. But I had a look for the financial impact not only of this measure relating to the pensioner education supplement but of the various other measures that are provided for in this legislation, and the explanatory memorandum does explain the financial impact. It says:

The financial impact of the Bill is minimal.

So why do it? Why didn’t anyone in the cabinet room say to the Prime Minister, as the chair of the cabinet: ‘Why are we doing this? There are no financial implications for the Commonwealth that are worth mentioning, that are even worth attaching a dollar amount to, and yet we’re going to do it—we’re going to take away the pensioner education supplement for a category of disability support pensioners.’

That is what I mean when I talk about the arrogance of this government and the fact that it has passed its use-by date. It should have been the case that at least a couple of cabinet ministers would have read the submission properly, would have read the intent of it and would have raised that simple question: ‘Prime Minister, why are we doing this? If it’s not really going to save the Commonwealth any money, why are we denying the pensioner education supplement to a category of disability support pensioners?’ Obviously the question was never asked. If it had been, surely they would at least have gone to the effort in a six-paragraph second reading speech to explain it. They do not.

Let me make this clear: Labor supports encouraging and assisting people to move from welfare to work. Labor supports the principle of self-reliance, of being able to get a job and hold down a job, which contributes to the self-esteem of Australians. We support individual freedom and self-reliance. With that in mind, we have argued consistently in opposition for meaningful measures to assist that transition from welfare to work. We support reward for effort. We also support the concept of mutual obligation.

The government pretends to the Australian people that the concept of mutual obligation is all its own, as if it were never a principle that guided the policy development of previous Labor governments. But it did. It was a Labor government that activity tested the unemployment benefit, that said to the unemployed: ‘If the Commonwealth is to give financial support to the unemployed then there is an obligation on the unemployed to do something in return—most particularly, to search for a job actively and meaningfully.’ In so many areas Labor applied that principle of mutual obligation. So there is nothing new in that principle. But you do need to support people so they are able to satisfy their end of the bargain—that is, to genuinely seek to move from welfare to work.

The truth of the matter is that those Australians who remain unemployed, and especially those who have been unemployed for a long period of time, have deficiencies, if you like, that are preventing them from successfully entering the labour market. The deficiencies that many of them suffer are related to their education levels and the skills that they possess or, more particularly, that they do not possess. Most jobs nowadays require a post-school qualification. In this parliament over the past four or five years there has been a vigorous debate between the coalition and Labor on the value of an education. The Prime Minister has said repeatedly that one of the great mistakes of the 1970s and 1980s was Labor’s obsession with lifting the proportion of young people who completed high school. Well, Labor did have an obsession with lifting the proportion of young people completing high school and was able to carry that obsession through to actual results.

In 1982, 36 per cent of young Australians went on to their last year of high school. That is called the year 12 retention rate. By 1996 that figure had more than doubled to around 75 per cent. Over the 13-year period of the previous Labor government, policies were consciously put in place designed to lift the proportion of young people going on to their final year of high school and completing it. The Prime Minister says that was a grave mistake. He is on the record as saying he does not know why Labor was so obsessed with lifting the proportion of young people finishing high school. That proportion has barely increased under the coalition government. And that is not an accident because it is active government policy, led by a Prime Minister who does not believe in the value of completing high school.

The problem more recently has been a fall in high school completion rates. When I highlighted this towards the end of last year, the Prime Minister said, ‘What are they going on about? Why are Labor concerned about this?’ Let us have a look at the international evidence. Let us have a look at the most recent report of the OECD, released towards the end of last year—OECD Education at a glance. That report makes it clear that completing high school is now the minimum standard for successful entry and participation in the labour market. That is a very big statement, based on reviewing evidence from all around the world. The new standard to be able to successfully enter and stay in the labour market is the completion of high school.

Not everyone had that opportunity in the past. Not everyone is able to do it now. Many young people do not feel cut out to complete high school. Many young people find that the way classes are arranged and the functioning of a school does not suit them and they cannot cope. That is why it is important that there are a range of different educational opportunities for young people who find it difficult to maintain an interest in years 11 and 12. That is why we have to have alternatives to mainstream high schools. It is an obligation on federal and state governments to ensure that there are alternatives to mainstream high school. My argument, therefore, is that we should be striving for every young person to complete high school or its equivalent through vocational education. Those opportunities do exist in part but there is not a comprehensive program around Australia to ensure that there is an array of alternative education opportunities for people who otherwise cannot cope with mainstream schooling.

That is why I am so angry at this measure. People who are on disability support pensions should be encouraged and supported when they want to improve their level of educational attainment to improve their skill levels. We are dealing here with a category of people who want to enter the labour market, who want to be successful and who are looking for a bit of support. It is not as if this pensioner education supplement gives them thousands and thousands of dollars a year. It is a small amount, yet the Prime Minister and his cabinet have said that they will deny that to a group of disability support pensioners. Why? Because they can and they want to. Labor is calling this government to account for that callous decision.

More than two million Australians, despite the very high levels of employment in this country, want to work or they want to work more hours. There is a lot of capacity there on the part of Australians to enter the labour market or to participate more heavily in it. That capacity will be enhanced if they have the necessary skills, and that is where the pensioner education supplement comes into play. Instead of supporting those people the government is relying heavily on migration. I support, and have always supported, a strong immigration program. Indeed, last year net overseas migration has outstripped natural increase as a source of population growth in this country. I think it is great that we have a strong immigration program. I oppose what the government has done in relation to extending the period of time before a migrant can apply for Australian citizenship from two to four years. I argue that we should be encouraging migrants to make a commitment to this country through a decision to become Australian citizens, not discouraging them through requiring a four-year period before they can apply.

But the truth of the matter is that immigration will not be the cure-all for our shortages of labour in this country. The reason is that in the 21st century there is very intense competition for skilled migrants and indeed for less skilled migrants between countries that are all the subject of population ageing. That includes most of the developed countries of the world. So we will not be able to rely on migration alone to deal with labour and skills shortages. Why not encourage those 2.3 million Australians who either want to work or want to work longer hours? That is what welfare to work should be all about; not just belting people but encouraging them.

This measure relating to the pensioner education supplement is no accident, because it is built on the same philosophy that the government has applied in its so-called Welfare to Work arrangements for sole parents. Let us understand what the government has done to sole parents. It is said that, when their youngest child turns eight, they will lose the sole parent pension and be put onto Newstart, which is $29 a week less. Furthermore, they will lose the pensioner education supplement because that applies to sole parent pension but does not apply to Newstart. In addition, the income-free area under Newstart is smaller than under the sole parent pension. If they do seek work and gain it, then they will lose more cents in the dollar for every dollar they earn compared with the sole parent pension.

So there are a whole range of disincentives put in place by this government in its so-called Welfare to Work measures for sole parents to move from welfare to work. Instead of providing incentives, the government is providing a big stick. The stick gets bigger and the carrot gets smaller. In denying those sole parents the pensioner education supplement, the government is making a conscious decision that it really does not want them, and does not want to encourage them, to develop the skills that are necessary these days to participate in the labour market. Quite a number of sole parents are young girls who have got pregnant at school and have had to leave school to have a baby. Wouldn’t you think the government would then say that there is a really strong imperative to ensure that those young women, after having their babies, are able to resume their education and be supported through the pensioner education supplement? No, the government says, ‘We’re not doing that; we’re going to make sure that you are not eligible for the pensioner education supplement.’

What is a rational response for a sole parent in these circumstances as their youngest child is approaching eight years of age? A rational response is to have another baby. That is the most sensible thing for many young women—not to seek to enter the workforce but to have another baby—because that puts the issue off for another eight years. That way they would not have to confront a cut in their income support payments of $29 a week. They would not have to confront losing much more of every dollar of income earned if they did enter the workforce. They would not have to confront the reality of a smaller income-free area than that which they were able to obtain under the sole parent pension.

That is why Labor describes these measures not as Welfare to Work but as welfare to welfare. The government, through its callous approach to sole parents and to disability support pensioners, is reducing incentives for them to move from welfare to work, and it is essentially because of the brutality of this measure in relation to the sole parent pension that Labor opposes the bill.

I will finish where I began: Labor supports reward for effort. Labor supports self-reliance. Labor supports the self-esteem that goes with getting a job. But, in making those commitments, Labor supports assisting people to move from welfare to work, not whacking them over the head with a big stick, which is what this government is doing—and it should be condemned for its brutality.

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