Chris Hayes (Werriwa, Australian Labor Party) Share this | Hansard source

I rise today to support the Social Security Amendment (Liquid Assets Waiting Period) Bill 2009 in recognition of the extraordinary nature of the economic circumstances that we now live in. I invite all members of the House to turn their minds back to a little over six months ago. Go back to a week or two before Lehman Brothers fell over, back in September last year. Up to that point in time, we had rising interest rates. Interest rates were rising at that stage fundamentally to slow down what was considered then as an overheating economy. Within this six-month period, we have seen the direct opposite occur here. We are very much in uncharted waters.

This is very much a time when we are trying to put our shoulders to the wheel with a view to doing what is necessary and making those decisions that are necessary to accommodate these changed circumstances. We have seen only in the last couple of weeks the $42 billion infrastructure package, the building and schools package, as it was developed. There was $14.7 billion to go into schools and $28.2 billion to go into our local councils. Every member in this place—and I know the member for Gippsland is one of those members working hard in his electorate—has sought to use that money for doing infrastructure projects. It is only right that we not be hypocritical about this and that we do go and pursue these projects with a view to generating jobs in our electorates. This is a critical time for this to occur.

There was also a $2.7 billion project announced in relation to taxation benefits for small business people. I know from visiting chambers of commerce in my own local community that that is very significant for small businesses in my area. Indeed, it is significant for every small business operator out there to have financial relief on their purchases of assets. The package also incorporated $12.7 billion, paid out this week, for low- to middle-income earners. This is about keeping our retail industries going. It is about keeping those people who work in the shops and also those drivers who drive the product to shops. As a matter of fact, I have only just left a meeting with Tony Sheldon and Daniel Kicuroski, from the TWU. They are certainly concerned about a range of things and about making sure that this stimulus package actually hits areas that affect logistics and transport throughout this country—and it is only right that they are.

This bill is another in a set of steps. It is critical, but this is also something that delivers fairness for those who are going to be less fortunate, those who will physically lose their jobs. Let us make no bones about it in this place: we know that is going to occur. This is not about finger-pointing; this is just a matter of looking at the economics of it. I, like everybody else, systematically call our job placement organisations to see what the trends are. Let us face it: we all do that. We all know that it is getting difficult out there. This is why this bill has come to pass. We are going to see redundancies coming out there. We are taking these steps to try and reduce the impact that this global financial crisis will have on Australian jobs. That is why we are injecting this $42 billion to stimulate employment. But we know that there are going to be casualties out there, and we have to try to do something for those people.

This bill will help those who lose their jobs by enabling people to have quicker access to income support payments by lifting the liquid assets waiting period. It will reduce the extent to which these people, many unemployed for the first time, must expend and draw down on their liquid assets, such as their savings, before being entitled to income support. The liquid assets waiting period, as it is known, is a key factor used by Centrelink to assess the financial position of people applying for various income payments, whether it be Newstart, youth allowance, sickness allowance or Austudy. Liquid assets, according to Centrelink, include such assets as cash in hand, shares, debentures, term deposits and other available moneys that can be called upon at short notice. Under the existing rules, income payments will not be affected by the liquid assets if they are less than $2,500 for singles and $5,000 for couples.

As I said, we are going to see people experiencing unemployment for the first time. Certainly it is going to be an extraordinary situation for generation Y, once they start seeing the reality of that. It is because of that that we need to do something about this liquid assets waiting period. If we do not then people will have to wait for somewhere between one and 13 weeks before they can draw down on income support. This means that many people who lose their jobs will have to expire all of their savings and possibly wait up to 13 weeks for support. Having been unemployed myself for a period of time, I know what it is like looking for work and doing everything to secure a job while supporting a family. There are difficulties. These difficulties are hopefully going to be confined to these times. We cannot say that emphatically, but we are, let us face it, trying to be positive. We are trying to stimulate the economy, we are trying to move on, but we have to do something for those people who will be caught through this process.

The thresholds that were introduced by the previous government back in 1996-97 came in as a budgetary measure. They were criticised by the then Labor opposition. It was decided to reduce those thresholds. Through this bill, we are taking those thresholds back to where they were at the time the Howard government was elected in 1996. This government is trying to undo the harm that occurred there. This is not seen as a budgetary measure, this is not just a measure where we can spend money; this is doing something genuine for those people who are going to fall through the cracks and find themselves—probably for the first time in their lives—unemployed, worried and wondering what the future is going to be. This is a time that they are going to need support. We criticised what John Howard did back then. There is a litany of Labor speeches that were given to that effect. But let us not dwell on the past. What we have to do is get back to the pre-1997 thresholds and establish some fairness and some decency in the way we treat people who unfortunately find themselves redundant due to this economic position that we now find ourselves in.

Not only is this measure fair, but it is also necessary to provide additional support to job seekers because of these extraordinary circumstances. It is not surprising that those on the other side of the House have various views in relation to this. I know they have taken a very clear view when it comes to the stimulus package itself. This is a time when we should be putting politics aside. We are not walking to an election in the next five minutes—it is not like Queensland here. Quite frankly, the economic position that we have, which has been thrust on the world within six months, and the severity that this economic impact has had globally, require all people in all parties to work together to help resolve this situation. This notion that one side can disengage and blame the other side for pursuing a debt strategy is like fiddling while Rome burns. This is the time when we want people in public office to muscle up, to be counted, to do something for their electorates. As I said, I do not want to embarrass the fellow, the member for Gippsland. I know the minister for infrastructure and local government has cited a number of his letters, but I only put it in this debate to show that the reality is that, despite the way he chose to vote with his party, he really knows in his heart of hearts that this is a good strategy, this is something that is beneficial for his people over there and he is to be commended for that. He can wear the embarrassment: he has shaved his head, so I imagine he can wear any embarrassment.

I will wrap up quickly on this matter. One of the other really perverse aspects of the legacy of the Howard regime is that we formerly included the insurance policies of people in assessing their liquid assets. Like the former speaker, the member for Deakin, at one time I too had to cash in my insurance policies to do something that was necessary for a family commitment. That is not something that people take on lightly. Fortunately, a lot of people have superannuation these days and choose to take out income support or some life insurance through their superannuation, but not everyone does. To have a situation where we would include life insurance in an assessment of their assets to determine how long they need to wait for financial support is absolutely ridiculous. Firstly, the cash-in rate is very low. Once you do that, the likelihood of again taking out life insurance, particularly if you have aged in the process—which most people do—is going to be very hard and very costly. We should not single out for special treatment those people who take out life insurance to protect their families, as is the case in the current legislation. This piece of legislation seeks to remedy that. I will not take any more of the chamber’s time. I do support this legislation. I think this is something that is overdue, and it was an election commitment. If those on the other side are genuine, they would be supporting this piece of legislation.

See this speech in context