Luke Hartsuyker (Cowper, National Party, Assistant Minister for Employment) Share this | Link to this | Hansard source

I move:

That this bill be now read a second time.

Today I introduce the Social Security Legislation Amendment (Stronger Penalties for Serious Failures) Bill 2014 to strengthen the job seeker compliance framework.

It has long been a feature of our welfare system that job seekers in receipt of income support are asked to do certain activities in return for that taxpayer-funded benefit.

This includes actively looking for work, undertaking activities to improve their job prospects and taking up a suitable job offer.

The coalition firmly believes in the importance of this mutual obligation.

Our recent budget contained a number of measures to strengthen the mutual obligation and job seeker compliance frameworks.

The bill I present today gives effect to the budget measure to tighten the rules for job seekers who refuse a job, or persistently fail to meet their requirements.

This bill will help to restore the integrity of our welfare system and ensure that available resources are used efficiently and effectively.

The coalition understands that most job seekers in receipt of income support do the right thing by the taxpayer.

Most job seekers want to work and make the effort to find and keep a job.

However, there are some job seekers who do not meet their mutual obligation requirements and are abusing the system.

The former Labor government encouraged this poor behaviour by weakening the rules regarding the application of penalties for serious failures.

Serious failures include refusing a job or persistent noncompliance in meeting participation requirements.

Currently, a non-payment period of eight weeks may be applied in cases of a serious failure.

However, the changes introduced by Labor allowed people to waive the penalties for a serious failure simply by doing additional activities such as more intensive job search.

In 2012-13, there were 1,718 serious failures for refusing a job and, of these, the penalty was waived in 68 per cent of cases.

In that same year, there were 25,286 serious failures for repeated noncompliance and of these, the penalty was waived in 73 per cent of cases.

And of those waived, nearly one-third were for a job seeker's second or third episode of noncompliance.

These penalties were waived not because the job seekers were vulnerable or the jobs were unsuitable, but simply because the job seeker elected to do an intensive activity instead.

The coalition believes that the changes introduced by Labor have undermined the integrity of the job seeker compliance system.

The ability to continually waive the penalty means that job seekers who commit a serious failure can avoid the financial consequences of their actions, and continue to receive income support, despite their poor behaviour.

This is not right.

It is important that there are stronger deterrents in our system for those job seekers who abuse the system.

As I said, most job seekers do the right thing but some job seekers deliberately choose to avoid their responsibilities.

This bill will ensure that the existing financial penalties for more serious failures are applied more rigorously and in keeping with community expectations.

The government does not believe it is appropriate for a job seeker to refuse a suitable job and remain on welfare.

Anyone in receipt of a taxpayer funded income support payment should be prepared to accept any legitimate, suitable work that they are capable of doing.

The bill will ensure that all job seekers who refuse an offer of suitable work—or fail to accept a suitable job—are required to serve their eight-week non-payment period.

Job seekers in these cases will not be permitted to have their penalty waived through participation in intensive activities.

It will remain the case that job seekers will not be forced to take work that is clearly beyond their work capacity and that their individual circumstances, such as homelessness, will still be taken into account.

Some job seekers also fail to meet expectations with regard to participating in activities designed to improve their job prospects, such as meeting with their employment service providers or participating in activities.

Where a person is persistently and wilfully non-compliant in meeting these requirements then a non-payment penalty of eight weeks may be applied.

Unfortunately, the changes introduced by Labor also allowed this penalty to be waived through participation in intensive activities.

This means that there is now no meaningful consequence for people who are repeatedly noncompliant.

The absence of a real financial penalty for this group of job seekers means that people have no real incentive to change their behaviour for the better.

This bill limits the number of times a job seeker may have the penalty for persistent noncompliance waived.

In the future, job seekers will only be allowed to have this penalty waived once through participation in an intensive activity.

This is consistent with the original intent of the waiver provisions, which was to encourage job seekers to re-engage with their employment service provider and resume their participation activities.

By limiting this waiver to one occasion only, job seekers will be provided with a clearer incentive to fully meet their participation requirements into the future.

Conclusion

The government knows that there is little tolerance in the broader community for job seekers who repeatedly flout the rules.

Stakeholders, including social welfare groups, have been clear in their dealings with me that resources must be directed to those job seekers who do the right thing.

There are simply not enough resources to allow money to be provided to those job seekers who are not prepared to help themselves.

The changes I have outlined today will save $20.5 million over five years.

This is money that is better spent on repairing Labor's budget mess and meeting other priorities.

The changes in this bill are only targeted at that cohort of job seekers who refuse a suitable job without reasonable grounds and those who are wilfully and persistently noncompliant.

Those job seekers who do the right thing have nothing to worry about.

I trust that that those opposite will support this bill.

After all, it was the member for Adelaide, as Minister for Employment Participation, who said:

'A strengthening of the compliance system will mean that more job seekers are actively engaging in work experience activities, in training and in participation programs, so that they can find and keep a decent job.'

This is exactly what our bill seeks to achieve: more job seekers meeting their mutual obligation requirements and moving from welfare to work.

This bill will assist the government to ensure the integrity of our income support system by ensuring that the penalties for serious failures are applied more rigorously.

The bill underscores this government's commitment to reinvigorating mutual obligation, consistent with taxpayer expectations.

Debate adjourned.