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 (Further Strengthening Job Seeker Compliance) Bill 2015 seeks to amend the Social Security (Administration) Act 1999 to support measures the coalition government announced in its 2015-16 budget. As we have heard from the former Assistant Minister for Employment, the government is seeking to do five key things in relation to job seekers and job search requirements that would come into force from 1 July 2016 with the bill.

Firstly, the bill seeks to allow a job seeker's participation payment to be immediately suspended if that job seeker fails to enter into a job plan. Secondly, it is seeking to allow the secretary of the department to determine, through a legislative instrument, the meaning of 'acted in an inappropriate manner', to determine whether a job seeker has acted in a way such that the purpose of a job seeker's appointment is not achieved and to determine to apply a penalty in such cases. Thirdly, the bill seeks to allow a job seeker's participation payment to be suspended when a job seeker fails to participate in an activity without a reasonable excuse from the instalment period in which the failure is determined not the following fortnight. Fourthly, the bill seeks to allow a job seeker's participation payment to be suspended immediately when a job seeker fails to undertake adequate job search efforts without reasonable excuse. Fifthly, this bill seeks that job seekers who fail to accept work will no longer be able to have their penalty waived by undertaking additional activities even if this would cause financial hardship. The bill also seeks to rename all failures resulting in the short-term financial penalties and suspensions as no-show no-pay failures.

Labor have always supported the principle of mutual obligation. Indeed, it was Labor that introduced reforms that ensured job seekers engaged with employment service providers and met their obligations to find employment. That is, job seekers have an obligation to actively seek work and that the government has an obligation to support them and provide them with the resources to assist them into the labour force. Therefore, Labor will be supporting some of the proposed measures in this bill that more closely align the date of reasonable penalties and suspensions with the date of noncompliance. But Labor will never support punitive measures which will put vulnerable people at risk. And we will never support measures that undermine the capacity of Australians to participate in meaningful work.

Labor will always fight to protect job seekers from this government when they seek to treat unemployed Australians unfairly. That is what we did last year when we opposed and defeated the government's proposal for job seekers who are under 30 and on Newstart going without any payment—that is right, no money and no support at all for six months of each and every year that they were unemployed. We did it again when this government tried, just last month, to get the Senate to agree to leave job seekers with nothing to live on for one month. Labor oppose having job seekers live with no support payments for long periods of time, as we understand the consequences of such actions.

Labor also fought the government's unreasonable attack on job seekers when it tried to force job seekers to apply for 40 jobs per month, despite clear evidence that it would create a massive, unnecessary administrative burden on businesses and despite the fact that, since the last election, the government has failed to develop anything that in any way resembles a comprehensive plan to create jobs and grow the Australian economy.

Labor also stood up for vulnerable job seekers when the government sought to change the definition of what constitutes 'a reasonable excuse' for job seekers who are not meeting their obligations. Labor's record stands for itself when it comes to supporting job seekers to meet their obligation to find work and it stands for itself when it comes to protecting vulnerable Australians from the coalition's ongoing attack on those Australians who find themselves unemployed.

As I have said previously, there are a number of proposals in this bill which Labor will support only because there is clear evidence that they will lead to better employment outcomes for job seekers whilst still ensuring adequate support. Namely, Labor want to be able to support the proposed measures in this bill that more closely align the dates of suspensions and/or penalties with the actual date of noncompliance—that is, job seekers will become aware sooner of their noncompliance and will be in a position to respond to it much faster.

With Labor's support, the Social Security Legislation Amendment (Stronger Penalties for Serious Failures) Bill 2014 legislated the no-show no-pay principle to provide a stronger incentive for job seekers to attend their appointments. Labor only did so on the basis that we were able to protect the right of job seekers to review decisions in which payments were suspended. It is, again, worth noting that this is a right that the coalition government sought to remove. Labor also supported this measure on the basis that we protected the rights of job seekers to justify a reasonable excuse for breaches to their obligations and ensured that no job seeker would have their payments stopped without first being notified.

Labor recognise that a more immediate link for job seekers between a proven noncompliant action and any penalty or suspension applied through an appropriate and fair process is better for the job seeker than a penalty or suspension applied much further down the track. I note that the former assistant minister in his second reading speech advised that these changes have been effective in ensuring job seekers are continuing to engage and get support designed to assist them into work. As a result, the average payment suspension duration has fallen from 5.2 business days in September 2014 to 3.1 in March 2015. This is also a win for the broader community, as it means more Australians are engaging and looking for work, and it is a win for job seekers because it means they are spending less time without the support that they need. These measures also appear to have increased the engagement of job seekers, with the former assistant minister advising that over 90 per cent of job seekers attending a rescheduled appointment after missing their initial appointment compared to 65 per cent in 2013-14.

It is for these reasons that Labor will seek to support the proposals that will enable a suspension or penalty when a job seeker fails to participate in an activity, including such things as a course of education or training, Work for the Dole, voluntary work or unpaid work experience without a reasonable excuse, and the noncompliance would be immediately notified to the job seeker. This will ensure that the suspension or penalty is most effective and it will encourage job seekers to re-engage more quickly.

Similarly, Labor will support amendments regarding the imposition of more immediate penalties when a job seeker fails to undertake adequate job search efforts. Currently, it can take many weeks after a noncompliance before a penalty is applied. This amendment will allow payment to be delayed immediately when a job seeker fails to undertake adequate job search efforts without a reasonable excuse. This will, again, encourage job seekers to re-engage more quickly and also result in immediate and full back-pay. I have been assured by the former minister and the department that this will not change the amount of the penalties but will only mean that the penalties will be more immediate. Again, with the protection of reasonable excuse and adequate notification, this amendment will support job seekers and the broader community.

Labor also has no issue with the renaming of suspensions and penalties to make it easier for job seekers and job-service providers, for consistency, so long as there are no unintended consequences and no changes to existing penalties or suspensions other than those just mentioned. This is, however, where Labor's support for the coalition's amendment bill ends.

I now turn to one of the smaller but no less significant amendments in this bill relating to what is known as a jobs plan. The government is proposing that a recipient of Newstart or another relevant payment will be financially penalised if they refuse to sign their job plan at their first employment-service-provider appointment. Currently, the system only allows participants to be financially penalised by an employment-service provider for failing to agree to their job plan after the second refusal to sign, by way of a reconnection failure. Such a penalty can be imposed until a job seeker does enter into a job plan. It does not appear unreasonable to allow a job seeker to refuse to immediately sign and agree to a job plan.

The current provisions appear to be adequate and appropriate and the government has provided no overwhelming evidence as to why this amendment should be supported. A job plan clearly sets out the mutual obligations that a job seeker and a service provider must both meet. It would, therefore, appear to promote greater engagement with a job seeker to allow them time to review and consider their obligations, under a job plan, before immediately having to agree to one. This change could conceivably leave job seekers with no payments for one month or unduly influence them to agree to a jobs plan they do not understand or agree to.

If passed, this measure will take away the essential right of job seekers to negotiate a fair and reasonable job plan. The current system provides job seekers with the right to take their job plan home and review it carefully, before being required to sign it. The current system also provides job seekers with protections from employment-service providers who may be seeking to impose obligations that are inappropriate or wrong. Unfortunately, with the introduction of the coalition's jobactive system, this appears to be becoming an all-too-frequent occurrence.

An employment advocate recently reported that a job seeker aged 55 was directed by their provider to undertake Work for the Dole. In fact, the deed and guidelines—again, as a result of Labor's advocacy—make it clear that job seekers aged 50 to 59 cannot be required to do mandatory Work for the Dole. Similarly, a constituent as the sole carer of two children, one with a disability, meeting her activity requirements by working casual jobs was told by her provider that she would lose her payment if she did not agree to undertake Work for the Dole, despite being exempt from these obligations.

Luckily, in both of these examples, the job seekers had the ability to access further advice and confirm, through government departments, that the advice they were given was wrong. It does, however, raise significant concerns for those job seekers who may not, for whatever reason, be able to access further advice. If job seekers are denied this necessary time to consider a jobs plan—known in the government's Job Plans Guideline as 'think time'—vulnerable job seekers could be at risk of signing job plans that do not accurately reflect their personal circumstances, resulting in mental distress and leading to non-compliance and further suspension of payments and, perhaps, greater disadvantage.

Similarly, Labor has significant concerns with the government's move to introduce a power to enable the secretary to suspend a job seeker's payment if the secretary determines that a job seeker acts in an inappropriate manner during an appointment, such that the purpose of the appointment is not achieved.

The former assistant minister asserted that job-service providers are reporting that some job seekers are treating service providers with contempt by not behaving appropriately at relevant appointments. However, again, there appears to be no clear evidence of how widespread this behaviour is. For this purpose, the legislation appears to be creating a new term—'inappropriate behaviour'—which currently is not defined and which would be determined in a legislative instrument made by the secretary.

Current departmental guidelines give some indication as to what behaving inappropriately might mean, including failing to behave according to commonly expected standards, not following reasonable instruction or being uncooperative. Given that the previous and not uncommon evidence provided to some job seekers of the new jobactive program is incorrect advice and job seekers being threatened with payment penalties for refusing to undertake activities—despite not being required to—it would seem that there may be occasions where it would be entirely justifiable for a job seeker to be uncooperative. As one stakeholder remarked, 'When you have some within the system already acting well outside of the guidelines to the detriment of job seekers, it may not be helpful to provide them with an even bigger stick.'

The Australian Unemployment Union also presents some evidence in its objection to this measure, in response to the former minister's suggestion that an employee who misbehaves at work and fails to participate would not be paid by their employer. The union points out that in such cases employees who make mistakes, at work, are given warnings before they are sacked or have wages taken away. Under this bill, job seekers are, again, being denied this important right to a warning and conciliation. Despite the government's desire to equate the actions of job seekers to employees, in this legislation, it appears it did not want to afford job seekers the similar and appropriate rights of the workers it was trying to equate them to.

Finally, I come to Labor's largest concern about this bill. It is the proposal in the amendment bill that seeks to reverse changes Labor made during its term in government, where it improved the former Liberal government's measures to ensure that job seekers who suffered a penalty for failing to accept suitable work were encouraged to re-engage in seeking employment and/or 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 non-payment penalty for failing to accept suitable work. This non-payment penalty may be waived if the job seeker agrees to re-engage and complete extra activity requirements. The legislation also currently provides that the non-payment period may also be waived if the job seeker would be in serious financial hardship if this non-payment period was not ended. These waiver provisions are important because they encourage job seekers to re-engage in the process after non-compliance by allowing the non-payment period to be ended if that job seeker re-engages with their participation obligations.

This bill is the coalition's second attempt to try and make changes so that job seekers who incur an eight-week non-payment penalty for refusing suitable work will no longer be able to have their penalty waived at all—at all! Labor opposed this previously and we will be opposing it again. It would mean that job seekers who have had their payment cut for eight weeks would not be able to re-engage at all during the eight-week non-payment period and their mutual obligations would cease during this period. Surely, it must be better to have job seekers doing more intensive job search activities and back actively looking for work rather than not doing anything—but apparently not, according to this government. Labor is also concerned that an eight-week penalty period is severe and could result in financial hardship and perhaps even worse social issues such as homelessness. Labor cannot allow this to occur. We see no overwhelming evidence to suggest a change to our position that would yield positive outcomes for job seekers or society more broadly.

The former assistant minister in his second reading speech indicated that the department in the 2013-14 financial year waived 78 per cent of those receiving eight-week penalties for refusing to accept a suitable job. This means that 78 percent of job seekers are re-engaging in the process of finding sustainable work. Isn't this exactly what we want to them to do? Why would we prefer to have someone have no payment for eight weeks rather than have the job seekers more engaged?

Interestingly, it appears these changes are again driven by ideology. The numbers do not appear to warrant these changes being pursued not once but twice. The former assistant minister notes that in 2013 there were 1,626 penalties applied for refusing or failing to accept reasonable work—that is just 0.2 per cent of the 800,000 job seekers. Clearly it is not a common occurrence, and clearly the numbers do not make sense.

As I said in my opening remarks, Labor have always supported the principle of mutual obligation and we will continue to do so. We want to see every Australian who is capable of work in a decent, safe and sustainable job, and we want the government to provide the support that unemployed Australians need to find work. That is why we want to support the elements in this bill that show clear evidence of increasing the chances of job seekers to find work, and increase the support that they can access in that process.

Fundamentally, this bill is about the detail of getting job seekers to look for work. The real issue here is that there are not enough jobs in Australia for everyone who can and wants to work. While an extra 95,000 Australians have joined the unemployment queue since the election, the coalition government has failed, in over two years, to deliver a genuine plan for job creation and for growing the economy. To simply talk about it is not enough. The unemployment rate has been at six per cent or above for 15 months now, and the last time this happened was over 12 years ago. The number of unemployed Australians remains at near 20-year highs. This time two years ago when the government was elected, unemployment was 5.6 per cent—today it is 6.2 per cent.

This trend is in stark contrast to the major advanced economies where unemployment rates are on the way down. This government is currently not even meeting its own very modest target to create one million jobs in five years. And of most concern, perhaps, is the significantly higher level of youth unemployment in this country. The fact remains that under the Abbott government unemployment is up and economic growth is down. Figures show that there are nearly five unemployed Australians for every vacant job. We have heard a lot in the last couple of weeks from the new Prime Minister about jobs and growth. Unless there is a real plan to actually create jobs and grow the economy, this new Prime Minister will be no different to the last one.

In conclusion, Labor will be moving amendments to remove parts of this bill that we do not support. And given the number of minor amendments in this bill, Labor has also referred the bill to the Senate Education and Employment Legislation Committee for hearings to ensure there are no further unintended consequences of this bill. I understand that the committee is due to report on 24 November 2015. I provided the government with a copy of Labor' s amendments three weeks ago. I sincerely hope that the government has taken the time to consider its position when I move these amendments during consideration in detail. I want to be very clear here: Labor will not support this bill if our amendments are not agreed to by the government, as we believe the risk to potentially vulnerable job seekers is just too great.

Karen McNamara (Dobell, Liberal Party) Share this | Link to this | Hansard source

I rise today in support of the Social Security Legislation Amendment (Further Strengthening Job Seeker Compliance) Bill 2015. This bill builds upon the successful reforms under the Social Security Legislation Amendment (Strengthening the Job Seeker Compliance Framework) Act 2014. The 2014 act has at its centre a no-show no-pay principle encouraging job seekers to attend their appointments with job service providers. The reforms proposed in last year's bill have proven effective. In 2013-14 only 65 per cent of job seekers who missed their first appointment attended their second rescheduled appointment. In stark contrast, in June 2015 over 90 per cent of job seekers attended a second rescheduled appointment.

The success of last year's reforms have seen more job seekers placed in paid employment. Importantly, last year's reforms have also reduced red tape and compliance requirements for employment service providers. The reduction of red tape for employment service providers has been attained through the fact that with more job seekers now attending appointments in the first instance, there is a reduction in these service providers requiring follow-up action regarding non-attendance.

This bill also seeks to amend the Social Security (Administration) Act 1999 to support measures introduced in the 2015-16 budget to strengthen the job seeker compliance framework. This is achieved by providing stronger consequences for job seekers who fail to meet their mutual obligation requirements. Such consequences are also made more immediate under this bill. This bill also simplifies the methods of compliance to ensure that job seekers better understand their mutual obligation requirements.

The provisions outlined in this bill will take effect from 1 July 2016 and contain a number of key factors. One of the significant amendments within this bill is the requirement for an employment pathway plan. The policy around the development of an employment pathway plan is one of common sense. To best position a job seeker for employment, their individual circumstances must be taken into account. Should a job seeker fail to enter into an employment pathway plan, the participation payment may not be made until the job seeker complies with a further opportunity to enter into a plan. If the job seeker does not have a reasonable excuse for not entering into an employment pathway plan, a penalty amount may be deducted from their payment. An employee does not receive payment for not working, so why should someone supported by the taxpayer be paid for doing nothing in return? The same standards of behaviour expected of employees in the workplace should be expected of job seekers in receipt of taxpayer funded income support. Of note is that currently there is no financial penalty imposed for refusal to enter into an employment pathway plan, despite it being a compulsory component to receive participation payments. It is the immediacy of the penalty which is a significant improvement in this bill.

The engagement of job seekers within the job market is another improvement in this bill. When a job seeker fails to engage in job-seeking activities such as training, or programs such as Work for the Dole, the penalty amount would be deducted from the instalment period in which the failure occurs. Job seekers who fail to actively engage in job-seeking activities will receive a penalty in proportion to the action on which they have failed. Put simply, job seekers who fail to participate in job-seeking activities will be penalised in the same instalment period in which they failed. Additionally, when a job seeker fails to undertake an appropriate search for work, their payment may not be payable until an adequate search is resumed. Once there is a demonstrated effort to find employment, job seekers will then receive full back-payment of the penalised amount. Under the current system, job seekers may receive full income support for up to 14 weeks, even if they are failing to conduct an adequate search for employment. This is unacceptable. Income support is designed as a support—it is a hand up when looking for employment, not a handout for nothing in return. Let us not forget that, with eight out of 10 taxpayers currently footing the welfare bill, those receiving payments owe it to Australian taxpayers to meet their employment-seeking obligations. These changes will ensure that there is no opportunity for some individuals to take advantage and be seen to bludge whilst receiving the taxpayer's dollar. Getting people into paid employment is and will always be this government's ultimate goal.

Also included in this bill is provision to ensure ongoing, proactive and enthusiastic job search efforts. Taxpayers' and the community's expectations are that offers of suitable employment should signal the end of income support. However, some job seekers are continually declining these offers. When a job seeker refuses or fails to accept an offer of suitable employment without a reasonable excuse for failure, the eight-week penalty period for failure will no longer be waived by simply demonstrating a re-engagement in job seeking. In 2013-14, around 78 per cent of eight-week non-payment period penalties for failing to engage in job-seeking activities were waived. This bill ensures that this period is not waived and that a strong deterrent is in place for those job seekers who elect to not work.

Unfortunately, in many circumstances and instances, jobs being refused by job seekers are ones that they are capable of doing. The jobs offered are not beyond a person's skill set and do not present a health or safety risk. More often, they are specifically targeted and offered in consideration of personal circumstances. Perhaps more alarming than job seekers refusing positions that they have the capacity and capability to fill are the reasons these job seekers provide for refusal. It is not good enough to refuse job offers and provide excuses such as that it would interfere with holiday plans, that the work is beneath them or that too much effort is required; it is totally unacceptable.

In a similar vein to job seekers being penalised for not showing up to appointments, those that show up but behave inappropriately will also be penalised and made accountable for their conduct. If an employee conducted themselves in an inappropriate manner, they would be suitably penalised by their employer. Therefore, why should those on income support expect payment for conducting themselves inappropriately whilst seeking employment?

As of March this year there were 5,359 people in my electorate of Dobell who were registered as unemployed. I acknowledge that amongst the 5,359 there are any number of families struggling to pay bills, to put food on the table or to provide financially for their children. The majority of job seekers do the right thing and they are genuinely seeking employment—they want to work. On a positive note, as of June this year Dobell has seen a reduction in registered unemployed persons to 4,687. I am not going to say that the government's reforms of last year to strengthen job seeker compliance are the sole reason for this decrease. However, I am going to proudly emphasise that this government is evidently getting more unemployed people re-engaged in the workforce. The change in attitude towards addressing unemployment between the previous Labor government and this government has now seen taxpayer funds no longer available as a permanent income stream. Rather, welfare payments are a support system to assist more job seekers into paid employment.

While there need to be penalties in place to address those who reject suitable employment, there is, of course, leniency in cases of hardship or difficult circumstances. This government acknowledges that sometimes circumstances change. I am sure that many in our community have faced personal difficulties at one point or another, which is exactly why the penalty for failure to accept a suitable job offer is waived if the job seeker is not able to undertake additional activities or if the penalty imposed would cause financial hardship. This provision takes into account those in our community undertaking caring duties and the many other situations which require support due to lack of paid employment.

The Social Security Legislation Amendment (Further Strengthening Job Seeker Compliance) Bill 2015 also simplifies the existing compliance framework and assists job seekers in understanding what is required of them when receiving income support.

Debate interrupted.