Julie Collins (Franklin, Australian Labor Party, Shadow Minister for Regional Development and Local Government) Share this | Link to this | Hansard source

The Social Security Legislation Amendment (Stronger Penalties for Serious Failures) Bill 2014 seeks to amend the changes that Labor made during our term in government, when we made changes to the former Liberal government's measures to ensure that job seekers who suffered a penalty for not actively seeking work or training were encouraged to re-engage and seek employment and training.

Under the current job seeker compliance provisions contained within the Social Security (Administration) Act 1999, job seekers receiving a participation payment—for example Newstart, youth allowance or parenting payment—may incur an eight-week nonpayment penalty for serious failures consisting of either their refusal of suitable work or persistent noncompliance with their participation obligations. These nonpayment penalties may be waived if the job seeker begins to comply with a serious failure requirement, such as work for the dole, job search training or undertaking more intensive job searches. The nonpayment period may also be waived if the job seeker does not have the capacity to comply with a serious failure requirement and would be in serious financial hardship if the nonpayment period was not ended. These waiver provisions are important as they encourage job seekers to re-engage in the process after noncompliance by allowing the nonpayment period to be ended if the job seeker re-engages with their participation obligations.

This stronger penalties for serious failures bill provides that job seekers who incur an eight-week nonpayment penalty for refusing suitable work will no longer be able to have the penalty waived at all. Job seekers who persistently fail to comply with participation obligations will only be allowed to have the penalty waived once using the same criteria during each period of continuous receipt of their participation payment. These changes will discourage re-engagement. As the government has confirmed, job seekers are not able to re-engage at all during the eight-week nonpayment period and their participation obligations will cease during this period. Even if a job seeker wanted to re-engage during the nonpayment period, this government has effectively prohibited them from doing so. This is at odds with the government's apparent intention to get people into work. It appears that this government is prepared to just give up on these job seekers, putting them in the too hard basket and imposing sanction after sanction rather than providing support, training and employment for them.

Many of these job seekers who are likely to have a penalty applied will already have been identified by Centrelink as having some vulnerability indicators—that is, they are likely to have a mental illness or be at risk of homelessness or have experienced a recent traumatic relationship or have some other vulnerability. These are very vulnerable job seekers that we are talking about. Indigenous job seekers are likely to be also represented among those penalised. Rather than providing further support for these already vulnerable and disadvantaged job seekers, this government wants to make them worse off by penalising them even more and making them suffer further financial hardship. Labor has some very serious concerns about this measure. The government is highlighting that it is intending to save $20 million over five years by introducing this measure. What it is actually doing is giving up on more than 6,500 job seekers each and every year for five years.

The Department of Human Services already has the ability to make a call on when to waive penalties and it already has the ability to use discretion with these job seekers. The Minister for Human Services in his second reading speech for this bill indicated that in the 2012-13 financial year the department decided to waive 68 per cent of the refusing a job cases and 73 per cent of cases of repeated noncompliance because job seekers undertook more intensive activity requirements instead. Isn't this what we want? We want people to re-engage and undertake activity. The numbers we are talking about here are very small—1,718 out of more than 600,000 people on Newstart and other payments have been deemed to have refused a suitable job. So it is a very small number of job seekers. We want these job seekers to re-engage, not to sit back and do nothing for eight weeks. This is how it should be—and this is the right balance between incentives and responsibilities, of both the government and the job seeker. Why would we prefer to have somebody on no payment for 8 weeks, rather than have job seekers more engaged? I really do not understand the government's, or the minister's, logic on this one.

The government has also confirmed its intention to amend the current Social Security (Administration) (Persistent Non-compliance) (DEEWR) Determination 2009 (No. 1). Indeed, the government tabled this new determination in the Senate just last week. This determination sets out what framework and obligations the Department of Human Services must take into account, when deciding whether to waive penalties and what constitutes penalties. With this social security determination, the government is seeking to make it harder for job seekers to argue that they had a reasonable excuse for turning down work, or for failing to comply with participation requirements. Labor is also very concerned by the exclusion, in this determination, of previously protected circumstances, such as where job seekers are homeless or have been recently imprisoned.

Another concerning aspect of this bill, the Social Security Legislation Amendment (Stronger Penalties for Serious Failures) Bill 2014, is that more than 76 per cent of the failures we are talking about relate to young people who are under 30. When this bill is viewed in light of the government's proposed draconian measures regarding young people on Newstart, it begins to become clear that this bill is designed to further oppress job seekers and increase their desperation, by providing the potential to enforce further non-payment periods of income support—in addition to the six months that the government has already said that it would force our young unemployed people to wait before becoming eligible for any payment of income support whatsoever.

Whilst on no payments for six months, those opposite also want to force young job seekers to apply for 40 jobs a month—that is, 40 job applications each and every month, when they are receiving no money to live on. No money for food, no money for shelter, no money for phone calls—but apparently we are going to require job seekers to apply for 40 jobs a month over the six months. These same under-30 job seekers could then be forced back into another period of non-payment for a further six months, after receiving income support for six months while undertaking work-for-the-dole obligations. So the cycle could continue: six months with nothing, six months of Newstart or Youth Allowance, and then six months again with nothing—and round and round we go, if this job seeker is unable to obtain work or go into training.

Even after young job seekers have served out their six-month waiting period, they still cannot rely on a full six months of income support, because the eight-week non-payment periods—which will no longer be able to be waived under this bill—could be served when they are in receipt of their Newstart allowance. In fact, the department advised during senate estimates that the period for non-payment penalties could be up to 11 months without Newstart. What is worse is that the department has acknowledged that no evaluations have been done into whether or not these changes would even be successful. There has been no research done, and no evidence obtained, to indicate that these measures will result in better outcomes for job seekers. This begs the question: does this government even care about better outcomes for job seekers, or is this simply a savings measure? Why would the government utilise unproven methods for getting people into work, in place of ones that we know and have proven to get people to work?

Labor also opposes the government's plans to push young people under 24 from Newstart onto the—lower—Youth Allowance. This is a cut of $48 a week, or almost $2,500 a year, and another attack on young people. For those people shifted from Newstart to Youth Allowance, this represents an almost 20 per cent cut in support. If you compare that to someone who is earning $200,000 a year paying $400 per year in debt tax, that is a huge difference. The person on $200,000 a year is getting a meagre 0.2 per cent reduction in their income, while the young person is getting a reduction of 20 per cent. That is not fair. As a result of measures in the budget, young people will be paying 100 times more, as a proportion of their income, than the high-income earners.

There are more cruel changes to come, with the Abbott government overseeing the death of mutual obligation. What this government should be focusing on, of course, is creating new jobs—not burdening our young people with application requirements and participation requirements. Labor is not only concerned by changes to mutual obligation but also increasingly worried about the government's repeated attempts to increase penalties for jobs seekers, rather than focusing on job creation. We know that the government has tried to sneak in other penalties, under the Social Security Legislation Amendment (Increased Employment Participation) Bill, where it sought to impose a six-month non-payment period—for those who received a relocation payment and left their employment within six months—rather than the status quo of a twelve-week non-payment period. This government appears to be all about harsher punishment and penalties—not about creating jobs. Unemployed people should not be punished for being unemployed; they should be supported into work, training, and education for future work—which is what Labor was doing when we were in government. Unemployment is a serious social issue for those affected, but the best response is a job. Programs by government should be focused on job creation: on ensuring people have the right skills, the right training, and the right education for jobs now and for the jobs of the future. Governments should be continuing programs that worked—like Youth Connections and the Partnership Brokers Program, both of which have been cut in this budget. The government should not be introducing measures that are not proven to work and that could have an adverse outcome.

As I have said previously in this place, Labor focused on supporting people to finish their schooling, and to get the training and higher education they needed for well-paying jobs. We as a government considered a whole range of different policies to address the issues of unemployment. We did not instinctively revert to punitive measures. We improved the accessibility of training and employment services. Prior to the election, we announced changes to Job Services Australia. We introduced a system with the flexibility to match individual job seekers with available jobs. We prioritised resources for those in the greatest need. We were planning to include employers much further in job seekers and outcomes. As a result of all of our measures, we achieved significantly greater outcomes than the government before us and we improved outcomes by 90 per cent for the most disadvantaged job seekers.

I reiterate what I have said before in this place. When we were in government, Labor helped over 1.6 million people secure jobs across the employment services portfolio. Our employment services system was recognised by the OECD as playing a central role in keeping unemployment low in the wake of the global financial crisis. During the GFC, Labor provided support to the economy to maintain jobs, saving an estimated 200,000 jobs.

Labor recognises that punitive measures designed to force people into employment will not work where there are no jobs available. Driving jobs growth should be the role of government. You cannot punish job seekers for not obtaining employment when there is a lack of jobs to be obtained.

Australians deserve a government that will fight for jobs, create jobs and support workers and job seekers. In office, we responded with assistance to maintain manufacturing jobs in Australia. We also provided additional support for workers who lost their jobs and were affected by this downturn in the manufacturing industry. We provided retraining and Job Services stream 3 as additional support for people who had lost their jobs. This is what governments should do. We did this because we believe that unemployed people should not be stigmatised but should be supported. We know that many people fall on hard times through no fault of their own, and it is the obligation of a responsible government to provide safety nets when this occurs. We should not be ostracising people for failing to obtain work and we should not be forcing them to survive in poverty.

This government is further alienating vulnerable people by ensuring that they never receive opportunities. They are doing this by not only taking away vulnerable people's rights to affordable higher education which will lead to greater employment prospects but also restricting the avenues for training to find work and ceasing programs that were proven to get people into work. They are also eroding payments under Newstart and leaving people without even a right to exist with their dignity. In government, Labor supported, assisted and encouraged people to find work.

We do not agree with the measures in this bill. We believe that the measures in this bill are punitive, we believe that they are unreasonable and we believe that they are unfair. There is no evidence that any of these measures would work. They put job seekers who have been penalised and who have lost their payment and want to re-engage into a position where they cannot.

This bill goes a step too far. It removes the discretion Centrelink currently has to waive penalties for vulnerable Australians. So in the best interests of those vulnerable jobs seekers who may be adversely affected by these measures, Labor will be opposing this bill.

David Gillespie (Lyne, National Party) Share this | Link to this | Hansard source

I rise to support this bill, which amends the Social Security (Administration) Act 1999 to introduce a stronger compliance framework for job seekers. The need to do this is a reflection of the undesirable and unintended consequences of having some sections of our communities become welfare dependent and even welfare expectant. While welfare is a privilege that the Australian economy can support and the Australian people are prepared to support, there need to be some parameters that stop people easily defaulting rather than working.

In my area, I commonly see the problems associated with long-term unemployment. The aim of our changes is to encourage people to get out of that rut in life under reasonable circumstances. In too many places around the nation, you can see the societal problems that come with long-term unemployed people. This bill will mean that the job seekers who incur a penalty for refusing or failing to commence work without good reason—and that is the most important part: when it is without good reason—will no longer be able to have the penalty waived.

Under the current job seeker compliance provisions, in division 3A of part 3 of the Social Security (Administration) Act, job seekers who are receiving a participation payment may incur an eight-week non-payment penalty for serious failures—that is, the refusal of suitable work or consistent noncompliance with their participation obligations. That participation payment includes Newstart allowance and, for some people, youth allowance, parenting payment and special benefit.

Currently, such a non-payment penalty can be waived if the job seeker begins to comply with a serious failure requirement—namely that they go on Work for the Dole, they go back on JobSearch training or they undertake more serious job searches. The non-payment period may also be waived if the job seeker does not have the capacity to comply with such a requirement and would be in serious financial hardship if the non-payment period was not ended. Schedule 1 would strengthen the job seeker compliance framework by providing that job seekers who incur an eight-week non-payment penalty for refusing suitable work will no longer have that penalty waived. Job seekers who consistently fail to comply with participation obligations will only be able to have the penalty waived once—and then only if they begin to comply with a serious failure requirement.

I will use a baseball analogy. If someone is under Work for the Dole or JobSearch and then they find a job and they do not take it they may have a valid reason such as that they are mentally ill or physically ill. They might get a job as a bricklayer but have heart disease or be riddled with arthritis or have some other problem that means they cannot do it. But, if they are physically fit and well and they refuse the job, they have to wear the penalty. It is okay to get out of it once but, at the moment, it is possible to have two strikes, three strikes and further recurring strikes. It can become a merry-go-round where you go on the JobSearch pathway and do all the searching and then if you get a job and you choose to not comply—that is, you do not take up the job—you can go back to the beginning again and go round and round again perpetually looking for a job.

The best thing we can do for those people is get them into employment. In fact, the best form of welfare is a permanent job. The best help for people who are getting depressed from being chronically unemployed is to give them dignity and a job. Unfortunately, there are some citizens in the system who think they can be perpetually looking for a job and knocking back offers when they are given them. So the intent of this bill goes to fairness and equity. The key principle is that the best thing for anyone is to get a job and, when one is offered, they should take it.

There are thousands of hardworking Australians who go to work every day, week in and week out, and pay taxes. They work weekend shiftwork. They earn money to support their families, homes and lifestyles. They also support the social welfare system that our nation is proud of. But they do not want to support people who are offered a chance to get out of that system and do not take it up without a reasonable, fair and understandable situation or excuse to explain it.

Many of us work for over a month to support one person on welfare for a day. As the number of workers drops, the burden on taxpayers rises. This initiative is trying to get those people who are taking advantage of the nation's generosity into work. Seventy per cent of the people on unemployment who get the chance for a job take it up. One of the observations is that 11 per cent of the people on unemployment have had four or five serious failures in one year. That means that for over half the year they have a penalty put against them and then they just get out of it by saying, 'I will go on JobSearch or Work for the Dole rather than taking a job.' That is what this legislation is aimed at.

In developing this bill, the government has considered the principles of the right to social security, the right to an adequate standard of living and the right to work. A job would not be considered suitable if the person lacks the skills to do that work. That is quite reasonable. No-one is going to be penalise you for that. If the only job in your town is for a rocket scientist but you did not get a good education, you would not be expected to take that job. But if they are going to teach you a skill you do not have and are there is training for it and you are fit and healthy, you will be expected to take it up. If you have a medical condition, as I have mentioned before, that is aggravated by the job or you have serious mental problems, no-one is going to see that as a failure.

As I mentioned, 70 per cent of people follow what is expected by the nation—and that is that you take a job when you are offered it. But, for that 11 per cent who seem to go round and round again, time is up. It is not one strike and you are out, but it is two strikes and you are out. It is not perpetual—three strikes, four strikes and five strikes—and you just go back to the beginning again. This bill will provide a strong deterrent for that behaviour and it will encourage job seekers to accept suitable employment. The bill will not impact on job seekers who cannot get work despite their best efforts but will target those who refuse an offer of suitable work without a reasonable excuse. I find this quite reasonable and I support the bill.

Brendan O'Connor (Gorton, Australian Labor Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

I rise to oppose the Social Security Legislation Amendment (Stronger Penalties for Serious Failures) Bill 2014. I do so because I and, indeed, Labor are opposed to the cruel and unfair measures that are contained within this bill. I listened to the member for Lyne talk about why he supports the bill and I have to say that he does not seem to understand the true social impact and also the economic impact that this bill will have if enacted.

Let's be clear here. The bill seeks to include changes to compliance provisions that will impose an eight-week non-payment penalty for failures on people which will prevent them from re-engaging in the job-seeking process. When I was Minister for Employment participation from 2007 until mid-2009 the first thing I did as minister was abolish the bureaucratic and badly constructed Job Network. We dedicated the resources to those job seekers who were most disadvantaged. We created four streams. The third and fourth streams were the most disadvantaged job seekers, people who had vocational and non-vocational barriers to employment and needed support of a vocational and non-vocational kind from employment providers, training providers and others.

But we also, along with that, looked at the way in which we could ensure that people would comply with their obligations pursuant to social security legislation. We found that the notion of an irreversible eight-week penalty, even if the job seeker chose to then re-engage in that eight-week period, was not economically sound and not socially responsible. We found that—and let's remember that 76 per cent of the failures currently relate to people under 30—there was a high incidence of people being homeless or at risk of being homeless as a result of the eight-week penalty being imposed. The fact that there was no flexibility for government agencies to resume payment of any kind to those job seekers, if those job seekers chose to resume their activities pursuant to the obligations they had under the legislation, we found to be too inflexible and too harsh.

The whole point here is to ensure that we provide the environment in which people are useful in society, are productive, and get self-fulfilment from work. That of course increases their independence and their capacity to look after themselves. That has to be the priority of any government. If you have a policy that is so inflexible that instead of actually ensuring people resume or re-engage with their community—in this case, looking for, finding and undertaking work—then we have failed as a government. That is why we changed the penalty.

As minister, I kept an eight-week penalty provision for exceptional circumstances, or as a last resort. But let us remember this. Of the 26,879 serious non-compliance penalties applied last year, only 752, just over three per cent, were refusing a suitable job offer. As Labor has always said, we believe if you are offered a suitable job and there is no good reason not to take it, you must take it. You must take work if you want to be in receipt of income derived from the taxpayer. Of course you should. But many of these so-called serious non-compliance penalties were nothing to do with rejecting a job offer. For that reason, the idea that an eight-week penalty, without any capacity or discretion to reverse that if the person seeks to resume those activities, is too harsh and unfair and is not economically sound. It means effectively that rather than those people engaging and having the modest means by which to re-engage and look for and find work, they are more likely to be less able and less inclined to do that, and, ultimately, the cost to society is greater. The reason it is greater is that other agencies of government have to pick up the pieces as a result of people finding themselves, for example, without accommodation. For example, they may not be able to pay rent. They may find themselves on the street or precariously accommodated, which makes it difficult to find work, even if they have decided to disregard the government's offer to make some payment to them.

So it is not sensible to have this one size fits all approach. We also brought in a requirement that if there are breaches and people are not undertaking their obligations, then, provided the circumstances are right, there should be a suspension of income—a loss of income. But if they resume those obligations and activities, then that very modest income resumes. It is just like work. If you do not work you do not get paid. If you do not do the activities you do not get that modest income that might keep you from being homeless and falling into other very difficult circumstances.

That approach created a work culture in the mind of job seekers, many of whom had not even had a job before. It was to say, 'If you do not undertake these activities you will not receive that modest income.' So it was creating a culture of drawing a correlation between a form of payment and undertakings you must fulfil. It was also flexible enough to prevent the likelihood of a higher incidence of people being worse off because they had no means by which to look after themselves, or to dress accordingly for job interviews, or to pay for public transport to get to a job interview or to a Centrelink office or to a job provider.

These were the things we needed to do. If in that eight-week period a job seeker is genuinely wanting to re-engage—say, after a week of not doing so during which time they might lose that one week's income—by undergoing training and other activities, whether it is Work for the Dole or other programs, then I think it is incumbent on the government to give that young kid a second chance and make sure they do not find themselves at the mercy of having no support, which too many young people in our society do, particularly those who do not have much family support. They may have very little family support and very few role models. We do have to provide that support. We can be tough, but we should be flexible. We can be tough, we can send a message, but if they re-engage they should have a chance of getting that modest income. That was the reason I, as minister, created that change. I believe that is a more suitable change.

It is also important to look at the proposed legislation that will remove for six months any entitlements at all for persons under the age of 30. This is on top of that. We have a situation where the government has proposed this to save, for budget purposes, about $1 billion. People under the age of 30, even if they are looking for work—each day, every day, every week and every month for six months—will not receive one cent of support from the Commonwealth and are supposed to make ends meet. Some people will be able to do so, because they can rely on their families I am glad to say. It might be hard for their families, who are struggling, but they will be able to rely on them. Others will not be so lucky to find any form of support as they look for work, but receive nothing. Let us be very clear here. This is the death of the mutual obligation. Mutual obligation, or reciprocal obligation, as it was first called, under Working Nation, during the Keating years, said this: you will get a modest form of income provided you are looking for work and engaging in activities.

The Howard government did the same—reinforced that principle, called it mutual obligation and said that you receive an unemployment benefit provided you are fulfilling your obligations. That is the 'mutual' part of mutual obligation. You do one thing; we provide some support to you, provided you undertake those things that must be done. This government has torn up the principles of mutual obligation and said, 'We don't care if you look for jobs every day.' In fact, they are forcing job seekers to look for 40 jobs a month and yet receive nothing for six months as a result of the proposal. I have to raise that, whilst it is not strictly a provision of this bill, because it is directly connected to these matters. I will now go to what could happen if these provisions were enacted.

A person under the age of 30 who is not in a job or in a learning institution receives no support for six months, even if they are looking for work. But if they are unfortunate enough to have a noncompliance breach that is deemed to be of a serious nature, they could have almost nine months without any support. If anyone had told me before the election that if this government were elected it would ensure that people under the age of 30 looking for work would receive no support from the government for up to nine months—certainly six months, which is automatic—then, even for this government, I would have said that that would be unlikely. Even for this Prime Minister and this Treasurer I would have said that it would be unlikely. Unfortunately, they surprised even me in proposing these initiatives. These initiatives are very, very harsh.

The government like to say that the reason they have had to bring about this change is to mend the budget. They have said it is a fiscal decision that they are making. If you are earning $200,000 a year for a temporary period you will be paying $400, because you are only taxed at two per cent on anything over $180,000. On the other hand, if you are turning 24 next year and you were hoping to get Newstart, you will see a reduction of about $2½ thousand in going from Newstart to youth allowance. So a person who is on about $12,000, going from Newstart to youth allowance, is going to lose 20 per cent of their income. Someone on $200,000 will lose $400. This is supposedly the government spreading the burden. It is a 0.2 per cent reduction in income for a person on $200,000 and a 20 per cent reduction for somebody on Newstart reverting to youth allowance. It is a hundredfold difference between the person on a very low income and person on $200,000. That is supposed to be fair. What a warped sense of fairness this government must have if it has the cheek to pretend that people are all sharing the burden in the same way. It is bad enough that there is almost a 20 per cent cut for 24-year-olds moving to youth allowance, but there is also a six-month waiting period. The bill before us in this place is just another nasty approach to helping young people, because it is primarily young people who will be found to have made breaches.

What really annoys the opposition, what quite frankly appals the opposition, is that it does not even allow for people to say: 'Okay, I understand why I lost some income. I want to undergo training. I want to get into the activities as outlined.' The eight weeks is irreversible. Let us think about how difficult it would be for a young person without the support of family to live for two months without a cent to their name, after, in some cases—if the government has its way—having lived six months without any support at all.

This bill cannot be supported by Labor. There is already in place a very flexible and effective means to ensure the system works. We would argue that the government should continue that and that it should withdraw this bill.

Melissa Price (Durack, Liberal Party) Share this | Link to this | Hansard source

Australians are very fortunate to live in a country where their government provides key welfare services to support those who are unable to provide for themselves. We have a welfare system that is dedicated to providing a helping hand through financial funding measures. The Department of Human Services is responsible for providing every Australian man, woman and child with access to significant services that we all should be thankful for. This includes services such as Medicare, Centrelink and child support. We are indeed a fortunate country. However, there are regrettably some who will abuse the system that was created for the good of the people.

The Social Security Legislation Amendment (Stronger Penalties for Serious Failures) Bill 2014 aims to strengthen the compliance framework for job seekers who receive taxpayer-funded income support through services such as Newstart allowance and, for other people, youth allowance, parenting payment or special benefit payments. To receive financial help via one of these payment methods, job seekers are expected to actively look for work, undertake activities to improve their job prospects and take up a suitable job offer.

From what I have heard from those on other side in this debate, we all agree that jobs are the answer. But unfortunately the Abbott government has found that a significant number of job seekers are taking serious advantage of our welfare system. They are taking advantage of penalty waivers that were introduced by the former government to avoid contributing to the Australian economy and our society by undertaking a suitable employment opportunity. Government cannot afford to be a cash cow for those who simply will not take steps to work. We all need to contribute to Australia's economy and our nation's future growth.

There are of course those who need government support as they are unable to gain or hold employment for various reasons, such as medical constraints. The government understands this and I support that. That is why we have significant welfare practices in place to lend a helping hand and give support to those who need it most. However, those that are able to gain and hold a job but are simply unwilling to do so should not receive this same government support.

Under the former Labor government we saw many cash splashes made without any thought to the consequences. Who could forget Labor's $900 stimulus payments, which saw more than 16,000 payments—totalling around $14 million; all borrowed money—being sent to taxpayers living overseas? If this was not bad enough, Labor's policy blunder also allowed more than 21,000 payments—totalling more than $18 million; again, more borrowed money—to be made to deceased taxpayers. That is why the Abbott government introduced legislation to repeal the Tax Bonus for Working Australians Act—to ensure these payments ceased.

The consequences of the former government's weakening of rules regarding the application of penalties for serious failures to comply with the rules for job seekers to receive taxpayer funded payments are also clear. In 2012-13 there were 1,718 serious failures for refusing a job, of which the penalty was waived in 68 per cent of cases. If that was not bad enough, in the same year there were 25,286 serious failures for repeated noncompliance, and of these the penalty was waived in 73 per cent of cases. Is it any wonder these supposed job seekers did not comply with the rules under the former government? Why would they, when rules were brushed aside and they were able to continue receiving payments from the government for doing nothing.

This is not just absurd, it is a shocking reflection on Australia's welfare system. It is shocking because it is taking money away from those Australians who truly need it and putting it in the pockets of those who do not have a reasonable excuse not to work. The Abbott government's move to strengthen compliance measures for job seekers should be commended by all who stand in this place. When we think about the distribution of funding by government, we in this place must think first and foremost about who this funding is intended to benefit and then determine whether this is being achieved in practice. In its current form, the Social Security (Administration) Act 1999 is not achieving its objectives, and when objectives are not being met, amendments need to be made. The bill before the House today will achieve this. It will introduce a more rigorous approach to the application of penalties to job seekers who refuse a job offer, including failing to commence the job, or who are persistently non-compliant. By strengthening the eight-week non-payment penalty for noncompliance, the government will be sending a clear message that the days of handouts are over.

We will achieve this by implementing new measures that ensure those job seekers who refuse or fail to commence work without good reason are no longer able to have the penalty waived under any circumstances. Instead, they will be required to serve the eight-week penalty in full. Previously, job seekers could have the penalty waived through engaging in an alternative activity such as intensive JobSearch training. By passing this bill, those in this place will also ensure that those who are persistently and wilfully non-compliant, such as repeatedly failing to attend appointments with their employment service providers, may only have the non-payment penalty waived once while in receipt of an activity tested income support payment. By tightening these rules the government will administer estimated net savings to a total of some $20 million by 2017-18—money that, instead of being spent on those who refuse to gain employment, will be spent on those who need it most and who do the right thing by government and every Australian taxpayer.

Brendan O'Connor (Gorton, Australian Labor Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

97 per cent do not refuse!

Melissa Price (Durack, Liberal Party) Share this | Link to this | Hansard source

Okay, you had your go. Now it is my turn. At 31 December 2013, around 11 per cent of job seekers had been reported for noncompliance three or more times during the last 12 months. This accounted for 71 per cent of all noncompliance reports. This clearly depicts the need to implement stronger deterrents, particularly for those job seekers who take advantage of Australian taxpayers by repeatedly failing to comply with the guidelines of income support payments. These people should not be allowed to refuse a suitable job offer and to continue receiving welfare payments from the government. The only way to improve this bad behaviour is to ensure there are financial consequences for noncompliers, rather than simply letting them get away with not working, through the former government's penalty waiver system. The introduction of waiver provisions by the former government in 2009 has had a significant negative effect on the provision of this service, with 644 penalties applied for refusing work in 2008-09 compared with 1,718 in 2012-13. These are people who have been assessed and deemed capable of working, but are simply refusing to do so.

It is important to note that checks and balances will be applied by the Department of Human Services when determining whether a job seeker has failed to comply with income payment requirements. The department will continue to be required to talk to the job seeker, the job seeker's employment service provider and the employer who offered the work before imposing an eight-week serious-failure period. Also, before a decision maker determines that a job seeker has committed a serious failure due to persistent non-compliance, the decision maker must conduct a Comprehensive Compliance Assessment. These checks and balances will ensure the eight-week penalty does not impact on those job seekers who, despite their best efforts, cannot get work. It targets those who are offered suitable work but refuse to engage in that employment opportunity without a reasonable excuse. There is a clear expectation throughout Australia that to receive a taxpayer funded financial payment from the government unemployed people should be expected at all times to demonstrate that they are actively looking for work or undertaking activities to improve their employment prospects.

I was disappointed to note that Western Australia recorded the second highest number of people issued with an eight-week non-payment penalty for noncompliance from 1 July 2012 to 30 June 2013. During that period 4,642 penalties were issued compared with 930 in Tasmania, which recorded the lowest number. It was also disappointing to note that Western Australia recorded the third-highest number of no-show no-pay financial penalties. Although the amendments before the House today do not seek to change the no-show no-pay penalty, this framework for assessing noncompliance by the Department of Human Services is also important to note. The consequence of a no-show no-pay failure is the application of a penalty amount equivalent to one working day of a person's payment. This is applied if a job seeker, without a reasonable excuse: fails to attend an activity that they are required to attend on a particular day; fails to behave appropriately while participating in an activity; fails to attend a job interview; or intentionally acts in a manner during a job interview that may result in an offer of employment not being made. This penalty was issued in Western Australia 7,271 times during the 2012-13 financial year.

These statistics clearly show that non-compliance is happening far too often throughout Australia. The worst cases, of course, are those that are regularly issued with non-compliance penalties, but they simply have this waived due to the former government's weakening of rules regarding the application of penalties for serious failures. The Australian people expect their taxpayer dollars to go towards policy measures that improve our community and benefit Australia as a whole.

Debate interrupted.

Ian Goodenough (Moore, Liberal Party) Share this | Link to this | Hansard source

Order! It being 7.30 pm I propose the question:

That the House now adjourn.