Yvette D'Ath (Petrie, Australian Labor Party) Share this | Hansard source

It is my pleasure to rise to speak in support of the Social Security Amendment (Parenting Payment Transitional Arrangement) Bill 2011. This bill is important to correct what has been referred to by the minister as an unintended consequence. We have heard the member for Menzies, who was the minister at the time that this transitional arrangement was brought in back in 2006, criticising the position that the government is now taking in relation to this bill. But the reality is that we are here today introducing this bill because there was a flaw in the way that this transitional arrangement was set up.

To set up a grandfathering arrangement generally means that you look at the entitlements being provided at the time and you protect those entitlements into the future for a period of time for that group of individuals that is receiving them. What grandfathering clauses are not meant to do is allow for those arrangements to indefinitely continue or, in effect, to expand those arrangements so that they not only protect those that were to be covered in the first place but in fact broaden their coverage, and that is what the changes back in 2006 did. The parenting payment transitional arrangements came in under Welfare to Work. The changes were in relation to the eligibility for parenting payment such that the recipients who claimed the payment from 1 July 2006 would cease to be eligible once their youngest child turned six if they were partnered or eight if they were single. Prior to these changes, eligibility for parenting payment ceased when the youngest child turned 16. So the purpose of the transitional arrangements was to identify those parents who were already in receipt of the parenting payment and to ensure that they, as recipients, continued to get that parenting payment until their youngest child turned 16. What that arrangement should have done is said 'until the child or children who existed at that point in time in 2006 turned 16', but it did not. It failed to put that clarity in the legislation at that time. It created a situation whereby not only the children who were born prior to 1 July 2006 but also children born post 1 July 2006 were included in this grandfathering clause; it applied to those children until they turned 16. And that is the case today. If those parents have another child today, then the grandfathering clause applies for 16 years from that child's birth. That is the problem that was created as a consequence of a flawed transitional arrangement established in 2006.

I appreciate the member for Menzies standing here in this chamber this evening and criticising the government for this measure, saying: 'This is not a Labor government policy. This is not about looking after parents and entitlements.' But the fact is the reason this bill is here is that the member for Menzies did not do his job properly in the first place. Basically, he introduced a flawed piece of legislation. So we are here today to rectify that problem in relation to the transitional arrangements and to ensure that those parents in receipt of the parenting payment who have a child post 1 July 2011 will receive exactly the same entitlement as every other parent getting the parenting payment—that is, they will get that entitlement until that child reaches the age of six if they are partnered or until the child reaches the age of eight if they are single. I fail to see any unfairness in a proposal that ensures that we bring in equality of entitlements for parents, and that is what this bill seeks to do.

It is very good to hear the member for Hasluck talking about the importance of incentives for businesses to ensure we are delivering skills and training and that we are moving away from reliance on welfare, because that is exactly what this Labor government's budget for 2011-12 did and that is what this bill before the House today does. This bill is the first stage of the income support payment reforms contained in the Building Australia's Future Workforce package. This is a package of incentives for parents to engage in the workforce and to reduce their dependency on welfare. It will provide families with a greater measure of financial security. This government is committing to building Australia's future workforce, ensuring we are training people and getting them ready for work. We are doing this through Skilling Australia's Future Workforce, providing $3 billion over six years. There will be reform of the training system, placing industry at the heart of the training effort. We will be ensuring apprenticeships that work for more Australians. There will be vocational education and training to meet the longer term needs of the economy. We will be building better skills for workforce participation. We are ensuring more participation, through rewards, opportunities and responsibilities. We are improving incentives in the tax system; investing so more young Australians are earning or learning; rewarding and supporting single parents to engage in work; supporting very long-term job seekers; providing more opportunities for people with disability; and taking a new approach to addressing entrenched disadvantage in targeted locations throughout the country.

Since the December quarter of 2007, Australia's GDP has risen 6½ per cent in real terms, while real GDPs in the euro area and Japan are yet to return to pre-crisis levels. During the global financial crisis, Australia was one of only three advanced economies not to enter recession. Australia's economy is expected to continue to strengthen over the medium term, driven by the resources boom, which will have flow-on effects for the rest of the economy.

Workforce participation is around historical highs, at close to 66 per cent. Unemployment is forecast to fall to 4½ per cent by mid-2013, and it is estimated that close to 500,000 jobs will be created over the next two years. However, there are still some groups at risk of missing out on these opportunities. This bill, other bills currently being debated before the House and bills that will be introduced over the coming weeks and months will implement the 2011-12 budget commitments. They will see this government committing to more workforce participation and ensuring that people who have been long-term unemployed, people who are single parents, people who have disabilities, young people and people in areas of entrenched disadvantage are getting the opportunity to participate in the workforce and have the dignity of work. That is what this government is about. It is about trying to move people away from the reliance on welfare and giving them that opportunity.

Some of the initiatives that are part of the Building Australia's Future Workforce package are about providing skills for workforce participation. This government is investing $263 million to help people attain the basic skills, such as reading, writing and numeracy, needed to participate in the workforce. If we want to move people out of the welfare system and back into work, we have to invest in the basic skills that those people need, especially if they have been long-term unemployed, especially if they have been at home caring for young children and out of the workforce for many years. That is why we will commit $143 million to provide 30,000 additional commencements for job seekers in the Language, Literacy and Numeracy Program; $80 million for additional training places for single and teenage parents; $20 million to expand the Workplace English Language and Literacy program to support businesses who want to boost the core skills of their workers; and $20 million to maintain the number of places in the Australian Apprenticeships Access Program to ensure apprentices have the basic skills they need. These measures build on the $116 million investment in language, literacy and numeracy in the 2010-11 budget through the Skills for Sustainable Growth initiative.

I have talked about workforce participation. This government is spreading the benefits of workforce participation through the most recent budget and through bills such as this. We are doing this by: rewarding work through more timely tax assistance, improved income tests for single parents and young people, and incentives for employers who hire people with disability and the very long-term unemployed; providing new opportunities to get people into work through training, education, child care and improved employment services; introducing new requirements for the very long-term unemployed, disability support pension recipients, teenage parents, jobless families and young people; and taking new approaches to address entrenched disadvantage in targeted locations.

That is what this Labor government are doing. We are doing everything possible to ensure that we are getting workforce participation. At a time with low unemployment but a skills shortage and businesses screaming out for workers, we need to do everything possible to make sure that people are not left behind. That is what we seek to do.

Before we started debating the Social Security Amendment (Parenting Payment Transitional Arrangement) Bill, a number of my colleagues were speaking on some of the new tax law amendments in relation to the budget. They were talking about the low-income tax offset. That is another one of those improved incentives in the tax system to make it more attractive for people to move back into the workforce but not be disadvantaged by doing so. Importantly, this bill is very much about rewarding and supporting parents who want to re-engage in work. It is so important that we do this. There are new opportunities and responsibilities for single parents. It goes both ways. We will provide the opportunities, but there are also responsibilities that come with that. In order to encourage parents to get into work, the government will provide $179 million to reward part-time work by reforming the income test for single parents on Newstart allowance. Changing the taper rate from the current 50c or 60c in the dollar to 40c in the dollar from 1 January 2013 will let them keep up to an extra $3,900 of their income from part-time work each year. From 1 January 2013, the government will also gradually phase out grandfathering arrangements for parenting payment recipients with a youngest child aged 12 to 15, to make eligibility more consistent with the treatment of other parents. That is what we are talking about with the bill before the House today. It is about providing incentives at the same time as ensuring that we are moving people away from reliance on welfare. It is also about providing consistency and equality. If we want to get the system right, if we want to get the balance right, we need to make sure that arrangements such as grandfathering arrangements work the way they are intended to—that is, they have a certain lifespan. Once that lifespan is up—and it should be a reasonable lifespan—those people move into a system, getting the same benefits as everyone else. They are not worse off, as the member for Menzies would have us believe. It is about equality. I fail to see how the member for Menzies can stand here and argue that. Parents who have a child after 1 July 2011 will still get the benefits of the transitional arrangements for all of their children who were born prior to 1 July 2011, if they were part of the transitional arrangements from the 2006 legislation. All of the children they have from 1 July will get the same benefits as those of every other parent out there. I think this bill is fair, and I commend it to the House.

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