Alex Hawke (Mitchell, Liberal Party) Share this | Link to this | Hansard source

It is very lucky for me to be able to follow the member for Chifley, having just left the chair and assumed my role as member for Mitchell in Western Sydney, because I rise today to speak about the rising phenomenon of youth unemployment, not just in Sydney and in Western Sydney but also across Australia, and its long-term consequences and problems for young people. The member for Chifley has a longstanding position against an airport in Western Sydney—the one economic driver that will provide jobs, investment, growth and a positive future for young people in Western Sydney—whereas we know that his government had a vision of handouts and government payments for young people, which, of course, is completely unsustainable. You do need economic drivers. You need good decisions that drive economic activity. An airport is an economic driver and will provide great opportunities for young people in Western Sydney.

Youth unemployment continues to be a sustained problem. We saw increases in unemployment in general under the Labor government and now we have a situation where there are about 266,000 unemployed youth in Australia at the moment, a national rate of unemployment amongst 15- to 24-year-olds of 12.9 per cent. The Brotherhood of Saint Laurence also estimates that there are about 300,000 more youth unemployed who are underemployed—that is, they have some form of employment but they would like more, more shifts, more work and more pay, and cannot obtain it. That is about a half a million young people who are either out of work or looking for more work.

This is a very serious issue. I note that in my area, in Sydney's Baulkham Hills and Hawkesbury region, in the new areas that they put together—something called SA4 regions, which are a bit different to the old ones—there are 2,500 unemployed youths aged 15 to 24. But, in neighbouring Blacktown, there are 5,400, a rate of 17.3 per cent, 15- to 24-year-olds seeking work who cannot obtain it. It is 12 per cent my own area. To me, this is unacceptably high and successive governments failed in many ways to get the trades and technical training correct, especially the last government. There continues to be a big gap in our dealing with the problem of youth unemployment and unemployment more generally.

I was pleased to see the Minister for Industry announce the second tranche of VET reforms that are to deliver industry led and job-ready skills and training. It sounds like an obvious statement of the facts to say that we should have job-ready skills and training programs, but the ideological approach of the previous government, particularly the previous Prime Minister, Julia Gillard, dismantled the Howard government's successful technical college model, which connected people with a real job at the end of vocational training. I particularly note the Anglican technical college just outside my electorate, in Greenway, which took a lot of kids from disadvantaged backgrounds but had one of the highest retention rates in the state, almost 90 per cent. That is because it focused not just on the theory of VET training but on the practical workplace—that is, master plumbers and master builders. With the week of theory, it provided students two weeks hands on, in the job, to learn the specifications required by the master builders and the master plumbers, then returning them to the classroom and to the workplace. That is job-ready training. It sounds obvious, but it is not so obvious.

We also see in Australia that at the moment just one in two apprentices completes their training—that is 50 per cent not completing their training—and just one apprentice in three completes their training in the same area they started. This is a great problem and the Minister for Industry, in announcing the second tranche of VET reforms, also made changes to the way the regulator, ASQA, operates to cut the excessive red tape that many of our high-performing training providers have been subject to for many, many years, allowing them to get on with doing what they do best: delivering high-calibre training that meets industry and the economy's needs. Amen to that. We need less regulation in this space and more practical outcomes. Governments state and federal spend a lot of money on training and we should be less than enthusiastic about many of these outcomes. We think we should have a general commitment across the chamber to ensure that money is well spent in this because the outputs here—the victims—are young people in our country, who are not obtaining work even though they are trained.

I have heard firsthand examples from people like the Master Builders, who tell me that you will get a certificate III bricklayer who has finished TAFE, who has his certificate, who is unable to lay a brick—he is unemployable, that poor person who has been fully trained. That young person is then unable to seek work because he does not have the skills to meet the job. He is unable to seek further training in bricklaying because he has his certificate, and the system says that you cannot return to get further training once you have your certificate. Even though he has spent plenty of time and the government has spent plenty of money training him, he does not have the skills to do the job. That is a real example, and there are many, many of these real examples in our country today—an unacceptable situation by far.

I certainly welcome the Minister for Industry's second round of VET reforms and I know the government has a great program for the Australian Apprenticeship Support Network—matching, in particular, employees with employers and potential apprentices with employers; providing advice about training options; offering personalised mentoring, and this makes a real difference to individual apprentices identified as needing extra support; offering guidance to business about taking apprentices; and managing the administration of an apprenticeship, including the training contact. These new arrangements are client-centred support arrangements and I have to say they are a welcome development.

I also want to note, in particular, the small and medium business feedback from around the country about the archaic industrial relations system that is preventing young people from getting a job. We saw under the previous Labor government a regression of the industrial relations climate which has, of course, paralysed the ability of small business to do the job we need them to be doing, and that is adding extra young people for that underemployment, those 300,000 young people who are underemployed, and those 266,000 young people who cannot get a job in Australia right now. The anecdotal evidence is severe when you go and talk to your family owned enterprise, the small business cafes who want to open on a Sunday or a public holiday—in regional areas in particular—but are unable to open because they cannot compete.

When a small business or a family business cannot open because of harsh penalty rates that are out of synch with their big business competitors—that is, big business and fast food chains pay less in penalty rates under their awards than restaurants and catering and hospitality on a Sunday or on a public holiday—everybody loses. The business owner cannot make any money. The young people cannot get the shifts that we know they are looking for on weekends—those people who study during the week. And we cannot get the goods and services that we need at reasonable prices on Sundays and public holidays. It is a lose-lose situation. It is why we have seen greater calls from the Australian Chamber of Commerce and Industry and the Retailers Association, all pointing to the fact that, particularly for young workers, these penalty rates that came about in an era when people were very religious or there was a particular penalty with working on a Saturday or Sunday, and these things no longer apply to the trading environment. They are simply archaic institutions supported by unions because the modern union movement is really about less work for more pay. It is their constant push. We saw a case that they just took to the Fair Work Commission and won to reduce the age at which adult wages have to be paid. Immediately upon winning that case they said, 'Now we are going to push to have it pushed further and further down—19- and 18-year-olds.' This is unrealistic in the current employment and economic environment and a real threat to youth employment.

If there are businesses out there—and there are many in many parts of this country—that want to open more and compete more and add more young people on, more people in more jobs are obviously better for our economy. I want to make it clear that we are not talking about, in this instance, public sector workers. We are not talking about nurses who give up late night shifts; we are not talking about police officers or fire officers who have to do unusual or unreasonable hours. Those penalties are absolutely appropriate and apply for industries and sectors of the economy where there is a penalty for working overnight or late. We are talking about archaic penalty rates, in some cases double-time and a half on a public holiday for a restaurant versus a fast-food chain, which is time and a half. How is that restaurant supposed to compete with a fast-food chain with that gap on a public holiday? That is why you cannot access goods and services; that is what is holding young people back in this country.

I am pleased to see the government moving so fast on the reform of the VET and training sector. Youth unemployment continues to be a major concern for me and people and members across Western Sydney, and colleagues in regional and rural areas, in particular, where youth unemployment rates are climbing and climbing. We need to recognise that we need to have a flexible industrial relations system and a flexible economy that can encourage those 1.7 million small businesses in Australia today to add that extra worker or that extra shift, and we need to give them every incentive to do so.

Laurie Ferguson (Werriwa, Australian Labor Party) Share this | Link to this | Hansard source

One can profess an interest in youth unemployment and belabour the point with rhetoric—quite doctrinal rhetoric—about deregulating the labour market; however, the question of youth unemployment has a few other facets. We have the situation the previous speaker spoke of, of 'handouts and payments'. I guess he is speaking of the Youth Connections program which engages vulnerable, disengaged and often marginalised youth in education and employment transition services. Perhaps he is talking about Partnership Brokers, which was a program that worked with 22 of the top 50 ASX companies and had brokered over 1,800 agreements between schools, employers and charities to make sure young Australians at risk of long-term unemployment moved into work. Perhaps the other 'handout and payment' he was whingeing about was the National Career Development Strategy which supported vital links between industry, students and training options.

I do not regard these as useless, pointless exercises. I could quote, for instance, David Thompson, chief executive of Jobs Australia, which represents non-profit employment service providers, who said in the magazine Justice Trends No. 154 of September 2014 that he could not see how some young job seekers would be able to survive, let alone meet the additional costs of finding out about and applying for jobs:

For those people who do not have access to other forms of support, like from their family, I just don't understand how anyone can imagine it is going to be possible for them to do these things.

He was, of course, referring to—amongst other things—the pushing of young people under 25 from Newstart onto the lower youth allowance—a cut of $48 a week or almost $2,500 a year.

Let us put that in real terms. There has been a lot of conjecture about and coverage of a very elaborate visit to Paris by the Minister for Education in recent times; there has been talk about the thousands of dollars he was able to spend on hotels. Let's emphasise the figures affecting these young people: their income is reduced from a paltry $13,273 a year to $10,774. So when we talk about youth unemployment we also have to have some compassion—not just rhetoric about changing industrial relations and shift penalties, but compassion for the practical circumstances of young people once they are unemployed.

It is all right for him to come here tonight and talk about unemployment under the previous government. What are the facts we face today? Unemployment figures over the last two months were 6.1 per cent and 6.2 per cent. In the Australian Financial Review of 8 August, Jacob Greber made a few comments about the situation. He noted that the seasonally adjusted figure of 6.4 per cent in July was the highest rate of unemployment in this country since 2002. He noted that youth unemployment was over 20 per cent for the first time in 20 years. I agree that the current Prime Minister has a great respect for John Howard, but to make your main purpose in life repeating his unemployment figures—to have the worst unemployment figure in this country since the previous Howard government—is a very questionable aim in life. Jacob Greber, in that article, commented on the weakening trend in hiring and noted that payroll growth for the previous three months was only 6,900. This comes from a Prime Minister who promised to create a million jobs. I know there is a defence for every one of these commitments made before the last election: 'We'll ignore what we said on pension rates; we'll ignore what we said on family incomes; we'll ignore what we said in regard to private universities.' Breaking all those other very firm, very tight commitments can allegedly be defended on the basis that we have got to reduce the deficit. They are all meaningless, supposedly, because of this one axiomatic phrase.

We now have a situation where unemployment is, as noted, the highest in 20 years. Then we have one of these characters in the government saying that perhaps people can go for 40 interviews every month. This is in a situation where there were 146,000 vacancies in the country to be shared amongst 740,000 unemployed people. That assumes every one of those people is suitable for employment; quite frankly, there are people in the labour force whom nobody in this room—or nobody anywhere—would hire for a variety of reasons. These 740,000 unemployed people are going to rush around doing 40 interviews a month for these 146,000 jobs. We note that criticism of this has not only come from predictable sources—from welfare organisations, trade unions or the Labor Party; it has come from a significant number of employer organisations. They are saying small business does not have time to be catering for this. They are not going to be sitting at the front gate waiting for all these people to walk down the road—or get out of their cars if they can afford them—and go to these interviews. When the previous speaker talked about the situation of young unemployed people, it is a matter of the actual circumstances that they face.

I have been pleasantly surprised in my electorate and even in the area where I live. I would have thought the general disregard for older people and for young people, the negative criticisms they make of them and their attitudes towards them would have dominated this debate. But I have been pleasantly surprised at how many older people—not only in the case of their own youth or their own children but also in the wider society—have come to me deploring these attacks on the income levels and these requirements that the other group would be denied any benefits for six months—denied income, totally. The education department of this government and the public servants went before the Senate estimates committee and said that, with penalties, some of these people would be unpaid for 11 months. We cannot all assume that these young people have the support of the income levels that members of parliament can provide for their children. They are sometimes in very difficult family circumstances. Their own parents can be chronically ill or chronically unemployed. They can have dysfunctional families where they do not get any income support.

I referred earlier, in quoting Mr David Thompson, to this article by the Australian Catholic Social Justice Council in the journal Justice Trends, which I referred to earlier. There were some other interesting comments about this debate. Cassandra Goldie from ACOSS, the main welfare organisation in this country, said:

Australia's employment services system is premised on the notion of mutual obligation. The current policy proposals fail to meet the Government's obligations.

Governments have a duty to provide income support and to help people to get a job, while people who are unemployed are required to search for jobs and participate in employment programs.

The youth employment measure in the Federal Budget would breach the Government's income support obligation by providing support for only six months a year in many cases. At the same time, Government investment in employment assistance—

what the previous speaker described as 'hand-outs'—

is inadequate, at only half the OECD average (0.3% compared to 0.6%).

I remember that, when Peter Costello was the treasurer of this country, he used to lampoon the opposition by saying that they were comparing this country to Swaziland, Botswana et cetera. Cassandra Goldie and I are comparing employment assistance in this country to the OECD. The level of support for job assistance in this country is half of the OECD advanced economies. She went on to say:

New requirements appear to be designed to make unemployment unattractive rather than assist people obtaining employment. There is too much activity for activity's sake and not enough flexible investment in what works such as wage subsidies and vocational training relevant to the labour market.

The proposed expansion of the Work for the Dole program is likely to be expensive and ineffective. At least $1,500 per person is being invested in this program despite less one in four jobseekers getting a job after Work for the Dole.

So there is more to this debate than to come in here and talk about penalty rates, union power and deregulating labour markets. The reality was that, under the previous Howard government, there was no correlation between employment levels and the deregulation of the labour market that occurred at that time. It was not that A led to B. There was no correlation whatsoever. If people care to do some research, rather than just come in and make doctrinal or ideological speeches, they might find that out.

I want to very much go on the record appreciating significant numbers of people in my electorate who are concerned at the low level of payments which the young people are receiving and the fact that there are going to be draconian measures, with people wasting their time by running around the factories around the place in Ingleburn and Macquarie Fields looking for jobs that are non-existent, and that the government is denying them proper training and abandoning very useful and effective previous schemes. Finally, all of this policy by this government is in the context of a government that has increased unemployment. In the previous few years, everything was going to be solved by the abolition of the carbon tax and there were going to be jobs flowing through the streets et cetera. The government totally deny the financial crisis and the unpredicted international crises that the previous government had to face, which were overcome by very significant stimulation measures by the previous government.

Karen Andrews (McPherson, Liberal Party) Share this | Link to this | Hansard source

There being no further speakers, the debate is adjourned and the resumption of debate will be made in order of the day for the next sitting.

Federation Chamber adjourned at 19:14