Jane Prentice (Ryan, Liberal Party) Share this | Hansard source

As I said in my first speech in this place 5½ years ago, it is the individual who stands front and centre, and it is by empowering the individual that we will unlock the real potential of our society. Then, as now, I strongly believe that the role of government is to provide the environment to give individuals the opportunities to create and succeed, but not to unreasonably interfere or restrict the freedoms and rights of individuals. I believe in a hand up, not a handout. I believe that the best form of welfare is a job. Indeed, if there is a choice between a handout or a hand up—a choice between receiving a fish or being able to fish—I know that most Australians, especially those living and working in my part of Australia, would choose self-sufficiency.

The coalition believes the best form of welfare is a job. That is why this government is working so hard to get as many Australians into gainful employment as possible. It is why we are providing more pathways to get people back into study or work, rather than providing incentives for people to get stuck on set-and-forget welfare payments. However, while we all value our independence and autonomy, it is important that governments also recognise that some people do need some help. A generous public welfare system is something that is provided only by the good grace and hard work of Australian taxpayers, so the Australian government has a responsibility to ensure that our welfare system is efficient, effective and well targeted. It is meant to be a safety net, not a permanent taxpayer funded salary in lieu of a genuine welfare need or a job.

On this measure, it is worth reflecting on the experience of Benjamin Franklin, who in 1766—even before Captain Cook traversed the eastern coast of our great island continent—warned of an unintended social cost for an institutionalised public welfare system. He said at that time:

I think the best way of doing good to the poor, is not making them easy in poverty, but leading or driving them out of it. In my youth I travelled much, and I observed in different countries, that the more public provisions were made for the poor, the less they provided for themselves, and of course became poorer. And, on the contrary, the less was done for them, the more they did for themselves, and became richer.

Roll on 250 years and there are still some people who seemingly think Australia's welfare system should provide a sofa in front of a TV, a bar stool at the local pub, a comfortable bed, a nice house and even a publicly funded overseas holiday. Those who accumulate a welfare debt to the taxpayer for claiming and then spending public money—taxpayers' money—for which they were not lawfully entitled should be forced to pay back this debt. As the old saying goes: fool me once, shame on you; fool me twice, shame on me.

I welcome the Social Services Legislation Amendment (Enhanced Welfare Payment Integrity) Bill 2016, because it continues this government's focus on protecting the integrity of our welfare system so we can provide welfare for those who need it most—the most vulnerable. I thank the minister for bringing this bill forward. Ironically, when thinking about the key principle at the heart of good government in 21st century Australia, it is also difficult to better Franklin's guidance: failing to plan is planning to fail. Our mission must be to improve the lifetime wellbeing of people and families in Australia and not accept an imperfect welfare system that will attract individuals, whole families and communities in Australia to intergenerational welfare dependency.

The enhanced welfare payment integrity measures in this bill are estimated to achieve net underlying savings of $157.8 million over the forward estimates. However, I believe it is the way the legislation 'disincentivises' receipt of public welfare money under false pretence that will be most transformative, especially with regard to enhancing a welfare recipient's reciprocal responsibilities under this new social contract. The bill introduces the legislative amendments required for the 2015-16 Mid-Year Economic and Fiscal Outlook Enhanced Welfare Payment Integrity expended debt recovery measure. It includes two measures. First, amendments allow for the use of departure prohibition orders to prevent targeted social welfare debtors from leaving the country, as is the case for child support debtors. Second, amendments remove the current six-year limitation on the recovery of social welfare debt that would otherwise be non-recoverable, which aligns the treatment of social welfare debt with the recovery arrangements in place with other Commonwealth agencies.

At the end of June 2015 there were more than one million debts with a value of $3.04 billion. This is a significant amount of taxpayers' money that could have been better spent. It is worrying that welfare debts have increased by almost 10 per cent in value since June 2014. In effect, the current system has inadvertently created an illegitimate—albeit publicly funded—interest-free loan facility. It is the government's belief that all debts should be repaid. It is important to recognise that a debt arises only where a person receives a payment to which they were not entitled, such as failing to advise the department of a change in personal circumstances. Of this debt base, approximately $870 million is held by around 270,000 former recipients who do not make sufficient or regular payments. This works out to be an average interest-free debt to the taxpayers of Australia of about $3,220 for 270,000 former welfare recipients, whereas current recipients of social welfare who also have a social security or family assistance debt have their welfare payments reduced until their debts are paid. However, there is no similar arrangement in place to recover debts once a person no longer requires social welfare or family assistance payments.

If we ignore moderate changes now, worrying issues and concerns like a 10 per cent increase in the value of welfare debts will grow into even bigger problems and remedial action will get harder. Unlike Labor, we do not raise taxes to balance the budget or pay for higher spending. Higher taxes for higher spending are not a plan for jobs and growth. The way to fix the budget is to control spending and grow the economy.

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