Bill Shorten (Maribyrnong, Australian Labor Party, Parliamentary Secretary for Disabilities and Children's Services) Share this | Hansard source

I rise today to support the Social Security Legislation Amendment (Employment Services Reform) Bill 2008. I am rising to support a balance between fairness and effectiveness, between empowering job seekers to participate in the workforce and making sure they do. The unlamented previous Liberal government presided over a compliance regime which did not have balance. It was harsh, it was counterproductive and it failed to bring down noncompliance in the workforce. It was a system that was not working, and we are proposing a better system—one that motivates job seekers to actually go out and look for work; one that looks into individual situations and provides help where it is needed.

Under the current regime, where there is an eight-week non-payment penalty, the job seeker is not required to have any contact with Centrelink or their employment service provider for that entire period. Given this, job seekers are not going to very eagerly look for work in that period. Why should they? There is too little deterrence in the early stages of noncompliance and too much later. Job seekers can miss up to a fortnight’s participation before any action is taken. Then, after three failures, they get hit with an irreversible eight-week non-payment period. The previous government went too far. But that is not news; they always went too far.

Let us examine the figures. In 2006-07 there were around 16,000 eight-week non-payment penalties applied. In 2007-08 this doubled to around 32,000 eight-week non-payment penalties. This was the opposite, I believe, of what was logically intended. There should have been fewer numbers each year because more job seekers will participate. I believe that these figures highlight the imbalance in the existing arrangements and the heavy-handedness of the punishments attached thereto.

An effective compliance system should result in fewer breaches because it encourages job seekers to meet their requirements and obtain employment. And it is just not working. This ‘penalise first’ approach prevents employment services from using their judgement to analyse a person’s circumstances. We acknowledge, and those of us who have a union background especially understand, there are occasions when things can get out of control: you have not paid the rent, you have been evicted and you are on the street on a winter’s night in a city far from where you grew up. No governmental process should leave a vulnerable person without food or shelter or multiply personal hardship the way the current system does.

We have heard through the employment services review that stopping payment for eight weeks places job seekers at great risk of disconnection, personal crisis and homelessness, and we heard it with no surprise. The flow-on effect of this is felt not only by the individual but by their families, their friends and the welfare groups that they turn to for support. I believe it also costs the broader community in tax through the health, welfare and justice systems. The Welfare Rights Network told us:

The relationship between this—

eight-week non-payment—

penalty and major dislocation, including homelessness, relationship breakdown, increased mental stress, illness, violence and crime is both categorical and direct.

Homelessness Australia told us about research from the University of New South Wales Social Policy Research Centre which found that up to 20 per cent of people who underwent an eight-week breach lost their accommodation or were forced to move to less appropriate housing.

With this measure this government is restoring the balance. Australians believe that if you are on taxpayer funded income support then you should work hard to find work; you should look all over. We are encouraging job seekers to find work and also giving them the means to be more work-ready. But there should also be appropriate penalties when people unreasonably fail to do what they said they would, which is look hard. Job seekers who do not look for work will be required to do so. As part of instilling a work culture in the new employment services, the ‘no-show, no-pay’ penalty will apply. It is just like it is with a job: if you do not turn up and you do not have a reasonable excuse then you will not be paid.

Noncompliance will have an immediate financial impact. There will be no waiting until the third strike before handing out unfair punishment, a double whammy, as it were, to the recipient. The size of the penalty under our idea will grow with the length of time that the job seeker plays hooky from their reasonable obligations. The new system will retain the current approach if you fail to attend an appointment or if you do not reasonably look for work. Job seekers can avoid a penalty by reconnecting with their provider or by meeting a further job search requirement. If they fail to do so, they will incur a penalty for the time they have been in absentia. This measure, we believe, will encourage participation and re-engagement.

Most job seekers are doing the right thing. But, like all Australians, the Rudd government will not put up with those who behave unreasonably. We are keeping the eight-week non-payment penalty for wilful and persistent noncompliance, but there will not be an automatic escalation in the severity of the penalty. One of the big differences between the current misguided system and the new system is that we will ask people why they are not complying. You are not automatically guilty until proven innocent with our reforms. We respect, we understand and we comprehend the fact that some job seekers face circumstances beyond their control which prevent them from meeting their obligations.

It seems that the previous government, as was their wont, painted every job seeker with the one brush, as a dole bludger. We will find out if a person has a good reason for not turning up, for not complying. If they do not, we will encourage them after the penalty to take responsibility and re-engage in the system. If they do have a good reason then their payment will be reinstated. This is in stark contrast to the current system, where they never have to look for work, where once penalised they are discouraged from looking for work—work which could improve their lives and provide much needed opportunity.

Our new system is tough but fair. It has a stronger safety net for vulnerable job seekers and a more powerful encouragement for the inattentive and the lackadaisical to get into the habit of work. It is a new compliance system for the new employment service system, an employment service system that focuses on the most disadvantaged job seekers, that provides 253,000 opportunities for training over five years through the productivity places program and that focuses on ensuring that job seekers will have the skills employers need. The Rudd government believes that those people on welfare who can work should work but it will not unfairly penalise those who cannot. I commend this measure to the House.

Debate (on motion by Ms Neal) adjourned.

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