Ed Husic (Chifley, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Treasurer) Share this | Link to this | Hansard source

We have had the opportunity through the course of this debate to outline a number of concerns that we have about the program design that will be supported by the passage of this bill. This bill does two things: one is that it provides a top-up to income support levels, and the second thing it does is that it allows someone to re-engage with the social security system if they have not been successful in holding down a job through the PaTH program.

A number of us will no doubt be taking the opportunity during consideration in detail to focus on different elements of the actual PaTH legislation that is being considered, and we would also like to take the opportunity to ask the government for answers to questions that we feel were simply not answered by the government, with all due respect to the minister at the table. A series of concerns have been raised relating to things such as the definition of what an intern would be and whether or not, for example, this bill would allow for the displacement of existing jobs. We also asked questions about whether or not wages would be undercut as a result of this system. Even with the top-up that is provided people will be paid at a rate that is less than the national minimum wage, and we have expressed concerns about that.

We have also expressed concerns about whether or not people who are in the unfortunate position of experiencing a workplace accident would be covered by workplace compensation legislation and what the arrangements would be around that. It is a bit hard to imagine that a $200 top-up to income support will cover people in the instance where they are injured, have significant medical costs, are unable to participate in the program and may be potentially prevented, as a result of that injury, from taking up employment. These are all serious questions and none of them, I say with the greatest of respect to the minister at the chair who has been provided with the summation to provide to the House, has been addressed. So I think it is important that in consideration in detail these things be looked at.

Importantly, one of the issues is that this bill will enable, in effect, churn. It recognises that there will be churn in this program—that is, that there will be people who will go through the PaTH program, will potentially start with an employer and then not be retained by that employer and will have to re-engage with the social security system. So there are questions that certainly arise out of schedule 2 of the government's bill, where it allows for a suspension instead of cancellation of income support. This addresses the need for safeguards in the event business fire employees within 26 weeks instead of following through on their commitment. I would like to ask: how much of this churn does the government estimate will happen as a result of the program? How many workers does the government anticipate will not make the full six months after participating in this program? With the government guarantee that businesses will not churn through free interns instead of hiring long-term employees? How will that churn be monitored? What steps will be put in place to identify it before interns are placed and after? Who will monitor those rates? Is a tip-off line in the National Customer Service Line enough to pick up instances of churn across 30,000 placements in up to 20,000 businesses a year? How will the government know whether interns are accepted and other employees in the organisations are retrenched? How much information about its company and its staffing will a business have to provide to be eligible to accept more interns under PaTH?

Michael McCormack (Riverina, National Party, Minister for Small Business) Share this | Link to this | Hansard source

I thank the member for Chifley—the shadow minister—for his questions. They are pertinent ones. I understand and acknowledge that. I am not going to endeavour to answer the hypothetical questions towards the end of his consideration in detail, but some of those earlier in his remarks I will answer.

The internship is an opportunity for individuals on income support to gain valuable work experience in a real workplace on a voluntary basis. There is nothing wrong with that. This should not be confused with paid work, as individuals will continue to remain on income support whilst undertaking the internship. The youth employment package will equip young jobseekers by getting them ready, giving them a go and getting them a job. I would have thought, given those wonderful ideals, that Labor would have gotten on board with the bill as proposed by the government in its original form.

I am asked how this form of work is legal and how it complies with the Fair Work Act. It is not work; it is work experience, and like other work experience programs such as the National Work Experience Program, internship participants will not be employees for the purposes of the Fair Work Act. In particular, this is because the Social Security Act provides that people will not be employees for the purpose of the act merely because they are undertaking an activity under their employment pathway plan. No legislative change is needed to exempt the internships from the coverage of the Fair Work Act because of the following: the Social Security Legislation Amendment (Employment Services Reform) Bill 2008 amended 631C of the Social Security Act to provide that from July 2009 approved programs of work and any other activities, including the employment pathway plan, did not give rise to an employer-employee relationship. That is important.

What protections will be in place to prevent employers from abusing the program, including displacement? I was asked that by the member for Chifley. Employers who participate in the internship program must be able to show real prospects of ongoing work. There will be safeguards to ensure that existing workers are not displaced. The program sets a maximum duration of 12 weeks and the number of weekly hours worked in a placement comes in at 25 hours. So internships will be voluntary for both businesses and jobseekers and will be co-designed by them to ensure that placements meet both of their needs. Importantly, the government will closely monitor the way employers use the program to ensure they are not exploiting or churning—a word the member for Chifley used—and burning jobseekers. Employers who are exploiting jobseekers will be blocked from using the program, as they should be.

Employment services providers will also be responsible for brokering internship placements and ensuring places are consistent with program guidelines. This includes the safety of jobseekers. Everybody in this parliament is adamant that the safety of jobseekers and workers is always paramount. Although internships are not an employer-employee relationship, businesses have a duty of care to provide a safe work environment—as the small business minister I know how important that is—and appropriate supervision for jobseekers undertaking internships. This includes ensuring compliance with applicable state and territory occupational health and safety legislation.

I also have to say that the Youth Jobs PaTH initiative is going to be good for Aboriginal jobseekers. I know the member for Chifley did not raise this, but he would probably like to know that of the 115,000 Indigenous jobseekers in employment services, around 76,000—roughly two-thirds—are being supported by jobactive, a further 29,000 are participating in the remote Community Development Program and 9,000 in disability employment services.

This is a good program. As the small business minister I commend it. I commend businesses to get on board with the program. Moreover, I commend jobseekers to absolutely take part and participate in this program because it will give them real meaning, real work and a real pathway for the future.

Linda Burney (Barton, Australian Labor Party) Share this | Link to this | Hansard source

I do not disagree with the sentiments of the Minister for Small Business. Labor believes in employment and youth employment as away of breaking disadvantage. There is no question about that. However, the youth unemployment figures are not reflected when you average out employment figures here in Australia, as is often done by the government. Spruiking unemployment figures is a smokescreen for the extreme level of youth unemployment in many regions across this country, including the Central Coast and the Hunter. I know the figures for these areas very well. Employment is an important pathway out of entrenched disadvantage. There is no question about that. Where Labor parts ways and the reason that the member for Chifley has moved these amendments is the nature of this program. Please do not pretend that it is anything other than an election thought-bubble. We all watched it. We all saw it. There was no detail then and there seems to be even less detail now.

The member for Chifley has highlighted a number of questions that we would like answered. I have come out of the New South Wales parliament, where, strangely, ministers did answer the questions raised in debate by the opposition. That is why you have three people sitting over there in those chairs, working away, I am assuming, to provide you with the answers to the questions that we are raising. That is what I am used to. It is sadly not what I see in this parliament. The issue that I am very much wanting to know about, particularly with my shadow portfolio responsibilities of human services, is where this program intersects in a real way with Centrelink and the administration of Centrelink. There must be a connection somewhere if the participants are recipients of, I am assuming, mostly Newstart. This concerns me deeply when I look at some of the real issues with Centrelink, particularly the lack of access to information and the extreme waiting times for people who are trying to get some information about their situation. I was in the Northern Territory on the weekend, and people there were waiting between three and six hours to get some sort of response from Centrelink. The IT system is nothing short of clunky. The casualisation of the staff is extreme. It seems to me that these issues need to be considered in the administration of this program. In fact, it is unclear to me how this program is going to be administered, where it is going to be administered from and what government agencies will have the responsibility for ensuring its overall implementation.

I will be a little more specific. The questions I raise are very much a microcosm of what the member for Chifley raised. I would like to know where the checks and balances are for this program. I have seen on countless occasions initiatives being undertaken, without real thought as to what the actual consequences were going to be, and how the checks and balances were to be put in place. I want to know how many interns one firm can have. I want to see and have explained to me, as we do on this side, what a detailed implementation plan is and whether there is any evaluation, given the Auditor-General's report about a number of programs just recently. How will this program be implemented? Who will do it? What is the plan? And what agencies are going to be responsible in its implementation? Is there an evaluation plan built in? What will be counted in that evaluation plan? How will we know whether it is successful or not?

The other issue is the human side of this. What will happen to a young person who is long-term unemployed—and this program is being held out to be the panacea for your long-term unemployed—if they are placed as intern after intern, after intern, with never any real outcome because of the way in which the program is structured? It seems to me that these are legitimate questions. I am not being cheeky, minister. I am asking these questions because I think they need to be answered to make sure that this program does what it says it is going to do— (Time expired)

Michael McCormack (Riverina, National Party, Minister for Small Business) Share this | Link to this | Hansard source

I will answer the member for Barton's questions inasmuch as she asked about the relationship between Centrelink and the Department of Employment. Of course those organisations talk with each other. They always do. They do with the coalition in government, they did when Labor was in power and they will continue to do that. That is just a given. This youth employment package was announced in the 2016-17 budget. It is an $840.3 million investment over four years to assist young people to develop the ability, skills and real work experience they need to get a job.

The member for Barton, coming from Whitton as she does, would understand the importance of young people getting a job. I know she does. I know she served in the New South Wales parliament. I know she had a fine record of service to that state parliament. I know that she, like me, as the small business minister, wants to see as many young people in jobs as possible. This package represents just that; it is a substantial investment in our youth. There could be no finer investment by a government than in our youth. It will ensure that young Australians receive job ready skills, which will enable them to obtain a foothold in the job market. It will build on initiatives introduced by the government under the Youth Employment Strategy. And it will work to further boost young people's job prospects by helping them to be better prepared for the workplace.

The member for Barton asked whether it would lead to an intern after intern, after intern situation. I can understand the member for Barton asking that question. But I know as an employer, before I got into parliament, as an editor of The Daily Advertiser newspaper at Wagga Wagga and then as a small business owner, if you have a good intern and they prove they were job ready—once they prove that they are capable of doing what you want them to do—you gave them a job. If there was a job there, you gave them that job. I am sure that employers across Australia will relish the opportunity to get good, young people job ready, focused on what they need to do, trained up and understanding the whys and wherefores of a workplace. If a job becomes available, they will get that position. It just makes good sense. It makes good business sense. It is what good bosses do. These measures, combined with existing initiatives, including the Transition to Work Service, Empowering YOUth Initiatives and the ParentsNext Project, will be putting young job seekers on a pathway to finding and, most importantly, keeping a job.

At the core of the youth employment package is the Social Security Legislation Amendment (Youth Jobs Path: Prepare, Trial, Hire) Bill 2016, the bill that we are considering in detail now. It is a $751.7 million initiative. It maximises the chances of jobseekers under 25 years of age getting a job. That is the age group where many of them leave school and many have seen their parents unemployed and their grandparents unemployed. We, as a government, want to get those young people into jobs because the best way out of welfare is into a job. The best way to a better future is a job. I understand that, as the Minister for Small Business. I know the members for Barton and Chifley and all those opposite get that. We on this side, of course, get it, because we are the side that understands how important getting youth employed is.

The youth employment package also includes measures on encouraging entrepreneurship and self-employment, designed to encourage young Australians to start a business and to create their own job. The package provides a step-by-step pathway to work, which directly deals with the major challenges to employment faced by young people—particularly in regional areas.

Whilst we are talking about regional areas and young people, we should also mention the backpacker tax, and why we want to make sure that the backpacker tax is fixed at 19 per cent, not 10½, so that foreign workers are faced with young Australians who are going to be paying a higher level of tax. We want to make sure that we get that fruit picked, make sure that those abattoirs are serviced, make sure that those pubs have the hospitality staff needed. There are many provisions, not just this one. There are many pieces of legislation that are so important and so critical to get through in these final few days of the 2016 parliament, to ensure that we get youth employed. And we must ensure that this particular legislation is carried.

Rebekha Sharkie (Mayo, Nick Xenophon Team) Share this | Link to this | Hansard source

Thank you, minister, for answering many of the questions that I have, but there are still so many that remain unanswered. The PaTH program will affect 120,000 young people, so it is imperative that government gets it right, particularly as this program affects our most vulnerable people entering the workforce.

While I support the government in ensuring that we are supporting young people, I think that this is too important to leave so many areas vague or open to ministerial or administrative discretion. I would like to ask the minister a number of questions relating to this. To begin with, how would the government ensure that employment service providers will explain to participants their rights in the workplace before an internship commences? How will the government disallow program participants from working beyond standard hours—for example, not just beyond the standard number of hours per day and beyond the standard number of continuous hours, but working without a break as well? We know young people are so eager to please and they are going to be so desperate for this free internship to turn into a job.

In my electorate there is 17 per cent youth unemployment. I meet hundreds of young people who are so desperate for a job. How will the government ensure that participants are able to afford the travel costs to attend the compulsory training components of the program, and what special conditions and consideration will be given to rural participants whose travel costs are considerably higher than other participants? The minister has a rural electorate like me. There are no cheap buses—there are no buses for young people to get on. They will need to somehow put petrol in the car and then get to that place of work, which may be 20 or 30 kilometres away. How will the government ensure that participation in the internships will be purely voluntary, and there will be no penalty beyond losing internship payments for withdrawing from an internship?

I acknowledge the minister's comments in relation to the duty of care of the employer, but how will the government ensure that the health and safety of participants in internships will be adequately protected and that adequate compensation will be available to participants, should they become sick or injured as a result of a workplace incident? I would be devastated to think that I supported legislation where, six months down the track, a young person in a butcher store who is so keen to work, so eager, loses their hand and then has no compensation and no rights of reply. I would be devastated to think that I supported that legislation.

How will the government ensure that program participants are provided with sufficient protections from bullying and sexual harassment? Again, we are talking about the most vulnerable people—many entering the workforce for the first time. How will the government ensure that large businesses do not abuse this scheme and use it purely as a source of cheap labour, replacing existing jobs? Surely this program should not be designed for cafes? How long does it take to learn how to make a coffee and to go out and wait tables? This program should be focused on people who are in trades, on where we know there will be jobs in the future and on where we know small businesses will be able to connect and put on apprentices and trainees. We know that we have 160,000 less trainees and apprentices today than we had just a few years ago. That is where the focus of this must be.

How will you ensure that there is sufficient focus and support for our most vulnerable young people, for young people from Aboriginal backgrounds, young people who have had possible connections with juvenile justice, and young people who are guardian-of-the-minister children? We need to ensure that those young people are properly supported and get the most out of this scheme.

How will the government ensure that there are effective complaints systems in place for program participants concerned with unreasonable treatment by their host organisations? I would also like to touch upon the previous member's comments about the program being properly reviewed and evaluated. Adding to that, I would like to say that it must be independently evaluated, and that review must be publicly available.

In closing, I am very concerned about medically certified sickness or compassionate reasons, such as even the death of a close family member, not being reasonable excuses for a program participant to end their involvement in the program. Surely this needs to be addressed.

Michael McCormack (Riverina, National Party, Minister for Small Business) Share this | Link to this | Hansard source

Thanks to the member for Mayo for her questions. They are important ones. I will just give a bit of an outline of the program to attempt to relieve some of her fears and concerns, which I would say are unfounded. I can assure the member for Mayo it is a good program. It has been well thought through, with consultation with key stakeholders and business groups, and in particular it provides jobs and hopes and opportunities for young Australians. The Jobs Youth PaTH improves upon and complements existing supporting programs by providing real world solutions to the real world employment challenges facing young people—young people in my electorate of Riverina, young people in the honourable member's electorate of Mayo. I know her electorate well.

The employability skills training will be intensively delivered in two blocks of three weeks, and the close engagement with employers in the training's design means that it will deliver real results. A wide range of organisations have already been consulted, as I have just discussed, on the training and their feedback will inform its implementation. The internship placement is different from existing work experience activities because it delivers a formal opportunity for young people to understand the work environment and at the same time it gives employers an opportunity to ensure the job seeker is a good fit for their business. Other key differences include: under the internship job seekers will receive a $200 per fortnight supplement on top of their income support payment, so that is a bonus, and employers will receive an up-front payment of $1,000 to host an intern, so that is good for them too. So it is a win-win situation. Previous wage subsidies for youth under 30 provided employers with up to $6,500, GST inclusive, over 12 months if they hired an eligible job seeker. The new youth bonus wage subsidy provides up to $10,000 over six months. In addition, all wage subsidies for job seekers aged 25 to 29 years—parents, Indigenous, mature age and the long-term unemployed—will be further enhanced, including payment over six months.

The member for Mayo asked about sexual harassment, about bullying in the workplace and about safety in the workplace. I can assure her that all those fit under this legislation. Of course no government would put in a plan that was going to give bullies in the workplace the opportunity to perpetrate their crimes—and they are crimes—against young people. There has been some suggestion that participants are going to be paid only $4 an hour. The Australian Council of Trade Unions have suggested that. The claim that the scheme will see young Australians paid so little per hour is a blatant lie, and the ACTU really should issue—

Ed Husic (Chifley, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Treasurer) Share this | Link to this | Hansard source

Rubbish!

Michael McCormack (Riverina, National Party, Minister for Small Business) Share this | Link to this | Hansard source

No, it is not rubbish. They should issue an apology for trying to mislead Australians. Dare I say it, that is typical of that organisation. Under the innovative Youth Jobs PaTH plan, the payment of $200 per fortnight is on top of the existing income support that the job seeker already receives. It is an opportunity for individuals, as I have said before, with income support to gain valuable work experience in a real workplace on a voluntary basis but with all the conditions that a usual employee would benefit from, would be subjected to and would have the experience of. This should not be confused with paid work as individuals will continue to stay on income support whilst undertaking the internship.

This is a good employment package. It is good for youth. It is good for young Australians. It makes them job ready. Many of them have not experienced this sort of undertaking before, this sort of opportunity, and I can assure the member for Mayo that particularly for regional areas, particularly for young people in country regions, this is a good deal for them. It makes them job ready. Employers and representative organisations such as the Business Council of Australia and the Australian Chamber of Commerce and Industry consistently state that young people need to improve their employability skills and have recent work experience. This PaTH program enables just that. Australian Bureau of Statistics data shows that more than 100,000 unemployed young people aged 15 to 24 have never worked before. It is a staggering statistic. Job seekers who undertake work experience are more likely to find sustainable ongoing employment. The department's administrative data for December 2014 showed that of the job seekers who undertook unpaid work experience, almost half were in employment three months later compared to 26 per cent for other activities.

Brian Mitchell (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

It is a sad day in Australian governance when a first-term opposition MP has to school a minister of the Crown on a piece of government legislation. The ACTU is absolutely right—it is $4 an hour on top of the Centrelink payment that they would normally already get. To say otherwise is simply a blatant falsehood. The minister and I share a history. I too am the former editor of a local newspaper—though not one quite so salubrious as The Daily Advertiser in Wagga! Our newspaper also had interns. They were university interns, usually students in their third year, or graduates. The big difference between them and what is being proposed now is that they were what most people would understand interns to be, which is young people learning on-the-job training for the profession of their choice—invaluable work experience. It was a win for the employer—we got a warm body to give some extra work to—but they got training, they got mentorship and they got a body of work that they could then use when they went out to get a real job.

The minister is quite right—if a good intern came along you would give them a job if a job was available. That is the key—if a job was available. The problem with this scheme is that it promotes, it incentivises, churn. You are going to give $1,000 to an employer every 12 weeks. If you are a small business employer and you are on the bones of your bum a little bit and the opportunity is there to turf a worker every 12 weeks and get a thousand bucks every 12 weeks, you are going to take it up. The minister will assure us in a moment that that will never happen—'Trust us, we would make sure that would not happen.' But I will tell you what, Minister—people game the system all the time. They find the loopholes, they find the gaps. Unless this is tied down and ironclad, that is what is going to happen. People will be ripped off, kids will be churned through this system every 12 weeks and dodgy employers will pocket that $1,000. One of my key concerns with this proposal is that it seeks to depress wages. It essentially creates a pool of free labour, and that then depresses wages for everybody else in the community. It treats young people as disposable—it tells them they are worth not quite as much as the rest of us. That, to me, is just not right.

I have a number of questions which hopefully the minister can answer in some detail. First, what happens if an intern sustains an injury at work?

Are interns covered by workers' compensation? The government simply has not addressed this important question. Will the base $200 a fortnight include the possibility of being made to work on public holidays and weekends? Does a penalty rates regime apply for these times? I suspect it does not. What is going to happen? For a worker who gets penalty rates with these times, the employer will say, 'There is a worker I have got to pay penalty rates to, and there is a free bit of labour.' Guess who will get those hours? It is absolutely outrageous. I would like some clarification on that. What qualification will an intern earn after four to 12 weeks in a workplace working 15 to 25 hours a week? Will they get a certificate? Will they get a trade qualification? Will they get anything to send to another employer, or will it just be, 'Thanks very much, on your way,' while somebody else comes in through the front door?

The minister assures us there will be safeguards. When you are dealing with legislation of this magnitude and when you are dealing with the lives of hundreds of thousands of young people, we need better in legislation than 'Just trust us.' We need to see the detail before it is put to the parliament. That is why Labor is going to seek to refer this to a Senate review. The minister said he can assure the member for Mayo that it is a good policy. She had some very good questions. I, too, represent a rural seat and I, too, know young people who find it very difficult to get to work. They do not all have cars and public transport is absolutely woeful. It is very expensive to get around. These are questions that need to be answered as well.

The minister said this will deal with the real-world challenges. A real-world challenge for young people is getting fair pay in the workplace. Australians have worked for generations to get fair pay and fair conditions for Australians in workplaces. We are simply not prepared to give it up on what is looking more and more like a dodgy free employment scheme.

Meryl Swanson (Paterson, Australian Labor Party) Share this | Link to this | Hansard source

I was listening intently to the minister as he said that there would be organisations that would broker partnerships for this program. I would like to directly ask the minister: which organisations will broker this program? Are they the same organisations that were completely decimated by the 2014 budget when the then Treasurer Mr Hockey stood up and announced that he would no longer continue the very successful brokerage partnership programs that had been occurring and which saw many young people find work. After that, we saw an increase in joblessness with our young people. That was a direct result of what this government did to absolutely eliminate and annihilate those fantastic programs that were working and that this government did not support and did not continue.

We on this side understand that youth unemployment truly is a scourge in our society and it is vital that we all work together to create the best environment that we can for our young people to get a job. We welcome additional resources being invested in youth employment, but I am convinced, as is Labor, that this Youth Jobs PaTH, as it stands, is not the best way to support young jobseekers or invest Commonwealth funds. It is not a pathway to employment, but, rather, a road to nowhere in my assessment.

The amendment that Labor proposes seeks guarantees that this legislation will not be used to exploit young people or to undermine workforce standards. As the member for Mayo pointed out, these young people are so keen to impress. They really are desperate for those jobs. How will they not be exploited? We have all been in situations where you might stay back for those extra couple of hours when you are trying your best to get an absolutely great opportunity. How will we ensure that these young people will not be exploited? We have real concerns about whether this actually presents a genuine opportunity for young people to gain meaningful employment or whether it is just going to be completely unworkable.

There is no firm definition of what an intern is under the program or what sectors they could be asked to work in. Large numbers of participants could be used within companies at one time, as we have already pointed out. There is a distinct difference between companies and the organisations that brokered programs in the past, as was pointed out earlier in the day. Also, large numbers of these interns could completely negate the need for existing employees in certain sectors, such as hospitality. And, as my colleague just pointed out, the penalty rate issue is one of the most glaring ones. What is going to cover someone who should be paid the appropriate penalty rates for being away from their family on a weekend, as opposed to an intern being brought in and being taken advantage of? These are real and genuine concerns that we have.

At a time when wages growth is at its lowest on record, there are very real concerns that the Youth Jobs PaTH program could be used to undermine wages across many industries. It will not be just young people and would-be workers who will suffer but all workers in lower-paying jobs who would be forced to compete with what is, virtually, slave labour. The Youth Jobs PaTH program does not specify real job areas in which jobseekers will acquire skills. All we have been told is that these programs will give young people the skills that employers tell us that they need. We need to know what these skills are. What are they? How will it work? I still want to know the definition of an intern. I want to know what they will be doing and I want to know what, more importantly, they will be learning. I want to know how this government can guarantee that it will not depress wages and I want the government to guarantee that it will not displace jobs.

I also want the government to guarantee that it will provide vital access to workers' compensation. It is no good saying, 'Everything will be okay; they will be safe and we would not put anything in place that would put anyone in a dire situation.' Well, I may be new but I am not quite that naive. We want to see this properly accounted for. The safety of our young people should be legislated. This government has an appalling record when it comes to helping young people. Apprenticeship numbers have been absolutely in freefall for the past three years. We have had the VET scheme; we have had Work for the Dole, which has not worked out well; and, I guarantee, in a few years we will be hearing how this has not worked out as well. These answers must be found.

Lisa Chesters (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

I also have a number of questions for the Minister for Small Business, or the person representing the minister—and we are not quite sure who that is at the moment. Perhaps it is the Minister for Infrastructure and Transport, who is sitting at the table, who is now representing the minister on this issue. Hopefully whoever is going to answer these questions is listening closely, because on this side we have raised a number of serious questions that we believe the government needs to answer, and our friends on the crossbench have also raised questions in relation to this program.

Since I made my speech on the Social Security Legislation Amendment (Youth Jobs Path: Prepare, Trial, Hire) Bill 2016 in the second reading debate, the government still has not responded to the concerns that I and many others raised. I reiterate the concerns about occupational health and safety. Where do these interns fit with regard to occupational health and safety? What happens if they are injured on a worksite? Do they complete a claim form? Are they entitled to workers compensation? Are they entitled to days off in payment of that? What happens if a worker is injured? We have already seen what has happened in the Work for the Dole scheme. There is no responsibility whatsoever if somebody is injured, we have heard—and we know that a young person tragically lost their life while involved in a Work for the Dole scheme. We need the government to guarantee that that will not happen with this system.

We have heard—and again the government has not responded on this—about the issue of pressure being applied to wages. This scheme says that somebody will get their youth allowance payments and $4 on top of that. What happens if they work on a weekend? Will they get an extra top-up for penalty rates? Is that being accounted for? What will this government do to ensure that these interns are not being used late at night, in the evenings, on penalty-rate days? Also, what is the government doing to ensure that these people, who will effectively be on a payment of Newstart plus $4 an hour, are not undercutting jobs and workers in these places? What about in places where there is a collective agreement in place that pays much more than this? Will the government guarantee that workers are not displaced in terms of shifts or hours? Will it guarantee that these interns will not take hours away from casuals who are relying on shifts to make ends meet?

The government has also not been clear about how these interns will intersect with, and what rights they will have under, the Fair Work Act. Again, the government has not been clear with the Australian people and with the prospective interns about how the Fair Work Act will apply to these young people. Will they have access to the unfair dismissal provisions? The reason the government is twisted in so many knots is that, currently under the Fair Work Act, there is no classification for an intern—none whatsoever. So, if a young person who is engaged in the program is dismissed, what happens to their payments? The government has said that they need to be able to prove that it was not their fault. That is so arbitrary. Who decides that dispute if an employer says, 'You're gone,' and the intern says, 'That's unfair'? Who is the arbiter? Who gets to decide that? If you are a worker, you are protected under the unfair dismissal provisions. In this particular situation, we do not know.

Also, the government have still failed to prove that these are not $4-an-hour supermarket internships—a concern that has been raised not just by the union movement but by young people themselves. The government still have not convinced us or the Australian people that this will not cut jobs. For a government that rant a lot about jobs and growth, they have failed to demonstrate how this program will not take jobs away from young people, and they need to come in here and make that clear. It used to be considered a bit of a rite of passage that a young person's first job would be in retail or hospitality. The government need to guarantee that, with this internship, they are not taking away jobs that otherwise would have gone to young people. They have failed to address that question. They have failed to answer that. They should come in here and address the concerns that have been raised not just by people in this House but by people within the community.

Brian Mitchell (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

I have been sitting here very patiently waiting for the Minister for Small Business to actually answer my questions. This is consideration in detail of the Social Security Legislation Amendment (Youth Jobs Path: Prepare, Trial, Hire) Bill 2016, and I have been very polite, I think. I asked him what I thought were fairly decent questions about whether young people on these so-called internships will be paid penalty rates, whether they will be made to work long and extraordinary hours through the night, whether they will be given access to transport options—all sorts of questions that the minister has failed to answer, perhaps because the minister is no longer here. The Minister for Small Business seems to have so little interest in this matter that he has departed the chamber and seems to have left his intern, the Minister for Infrastructure and Transport, in his place. I hope you are getting more than $4 an hour, Minister! On the matter of highly paid interns, I cannot go past the fact that my predecessor, the former member for Lyons Mr Eric Hutchinson, has got a pretty nice internship himself, with Senator Stephen Parry, the President of the Senate. It is a little more than $4 an hour, of course. It is around $160,000 a year, to attend functions. So that is not bad.

I am happy to stand here all day—I am here all week—and wait for the minister to come into the chamber and actually answer some of the very serious questions that have been put by me, the member for Mayo, the member for Paterson and the member for Bendigo, amongst others. These are very important questions. This is supposedly—so the government says—a panacea for the scourge of youth unemployment. I do not think there is anybody in here who is not desperately serious to see this matter addressed. Youth unemployment across the country is far too high. Where we differ is on how to address it. On this side, what we know is: you educate young people, you train young people and you provide them with pathways to work via apprenticeships. Yes, there are legitimate internships, such as those that university students and graduates go through, where they train for a short amount of time on the job and they get a portfolio of work, they have mentorship and they are on their way. That is a legitimate internship. A legitimate internship is not being employed by the local fish and chip shop, where the employer gets $1,000 to put you on behind the deep fryer, and you stand there for 12 weeks shuffling the fries and then you are out the door and somebody else walks in. That is not a legitimate internship. That is free labour, and what that means is that the kid next door does not get that job. The kid next door does not get that job on proper wages because that job has been taken up by free labour paid for by the taxpayer. That is just a taxpayer-funded rort for business. It is just not right. So the member for Bendigo asked a very good question on those matters.

I am still here; the minister still has not arrived. I do not know what could be keeping him. This is supposedly a very serious matter that the government has put to the House. We really need answers on these questions. I really would like to see him answer them.

Ed Husic (Chifley, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Treasurer) Share this | Link to this | Hansard source

What is becoming clear is this: this is a massive new program. What is being proposed here or what will be supported by this bill is something way higher than what the government has ever done. They have an existing program, the National Work Experience Program. It takes 6,000 people. This program boosts that up five times: 30,000 young Australians will go through this program. It is an entirely new system. A lot of people have legitimate concerns: that jobs will be displaced; that people who would have got a job independently will be replaced by an intern. And 'intern' has not even been defined; there is no definition from those opposite of what an 'intern' is. They may be an intern barista; they may be an intern construction worker; they may be an intern retail assistant—which completely flies in the face of what the general public thinks an intern is.

Those people would be paid below the national minimum wage. Bear in mind: the national minimum wage right now is $17.70 an hour. But an intern who works 25 hours a week and receives only their Newstart payments plus the $200 top-up will earn $14.50 an hour. The small business minister was saying that the ACTU should apologise because they were misrepresenting the situation. Guess what? The stats are clear. These people—these interns; these young Australians—will be brought in at a lower rate than the national minimum wage.

As wisely observed by the member for Mayo, we have no understanding about what the span of hours will be on any given day. They are supposed to work 15 to 25 hours a week. How do we know that they will not work 12 hours a day without a break? That is a legitimate question that was being posed. We have had questions about whether or not penalty rates would be undermined.

We have had a whole stack of concerns. But guess what? We are not going to get answers today, because what is going to happen is: the minister at the table here is just going to do them as one job lot and thinks that he will answer them in five minutes. And he will not. None of the questions that have been raised through the course of this consideration in detail, about a program that is massively expanding on what is currently being done, that will involve young people—questions that everyone wants to get legitimate answers to—will not be answered by this government.

It is a clear demonstration that, as the member for Barton said, they engaged in an election thought-bubble. Six months after this program was announced in the federal budget, they still cannot define what an intern is. They still cannot give us assurances that these people will be covered by workers' compensation. They still cannot give us assurances that the interns will not be used to displace jobs, in a market where people are already underemployed. Underemployment is already at an all-time high. People are already concerned about wages growth flatlining. There are all these concerns out there. But this government will not answer.

And I am sorry, but—with the greatest respect to the minister, who I have great time for: it is not good enough, Minister, to have all these members of parliament raise legitimate questions and to have them just pushed off into one five-minute job lot. Not only do these members deserve answers; the Australian public, who will be seeing this new thought-bubble unveiled, deserve answers as well.

It is basically April 2017 when this program comes in, and we still do not have answers about what is going to happen. I actually think we do need to get answers. We need to get answers to the question about workers' compensation, because, in the submission made by the department to the Senate inquiry that is going on now, published on the website, we are now told that the Department of Employment has insurance arrangements in place to cover jobseekers undertaking activities, including group personal accident insurance and combined liability insurance. But what happens if someone is permanently incapacitated as a result of an accident through being involved in an internship? What happens to them? At what rate do they get paid out? At what rate can they expect income support? Where do they go? Do they go on to DSP? What happens there? They will be placed in the invidious situation of being locked out of the job market. And we do not even know the details about the coverage.

These are the types of questions that deserve to be answered, and they should not be treated disrespectfully, through the way that they are being managed right now—with all due respect to the minister.

Darren Chester (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

I thank the members opposite for their questions and their contributions to this debate, and I thank them for their impending support for the bill which is before the House.

Ed Husic (Chifley, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Treasurer) Share this | Link to this | Hansard source

We've still got questions!

Darren Chester (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

And there will be more questions. I am going to answer some of the ones that I have got to in the last 10 or 15 minutes, Member for Chifley.

As the members are aware, the youth employment package was announced in the 2016-17 budget and is an investment in the order of $840 million, which will be implemented over four years to assist young people to develop their employability skills and provide them with the work experience they need to get a job. I thank the members opposite because I think they are very sincere in their enthusiasm for helping young Australians receive the job-ready skills they need which will enable them to obtain a foothold in the job market. It does build on other initiatives that the Turnbull government has implemented under the youth employment strategy, which will further boost young people's job prospects by making sure they are in a position to be better prepared to join the workplace.

Members asked questions as to: 'Why aren't the jobseekers undertaking internships paid at the minimum wage?' Under this program, placements do not constitute an employer-employee relationship and do not involve wages or salaries. The jobseekers continue to receive their income support as well as a $200 fortnightly supplement, which is paid by the Australian government. The program will provide those young jobseekers aged from 17 to 24 with an opportunity to show prospective employers what they can do in the workplace while gaining those valuable work skills and experience. I am sure members opposite would agree with me that quite often all a young person needs is a chance to get a foothold, to get their foot in their door, to demonstrate that they have the capacity to hold down employment. This internship program gives them a chance to prove their suitability for future employment.

In terms of the question about whether it complies with the Fair Work Act: the internship is not work; it is work experience, as members opposite would be aware. In relation to the need for such initiatives: it has been a matter of concern put to the government by organisations such as the Business Council of Australia and the Australian Chamber of Commerce and Industry, who have consistently stated that young people need to improve their employability skills and to have had recent work experience. The ABS data shows that more than 100,000 unemployed young people aged 15 to 24 have never worked before. That is an important consideration when we reflect on the position put by the government in relation to this legislation—100,000 young people aged 15 to 24 have never actually worked before. Giving them the opportunity to prove their abilities in the workplace is an endeavour worth pursuing.

In terms of protections to be put in place—and I acknowledge the questions raised by several speakers regarding protections to prevent employers from abusing the program, including the displacement effect, which I think some members referred to—employers who participate in the internship program must be able to show real prospects of ongoing work and there will be safeguards to ensure that existing workers are not displaced by the scheme. The program sets a maximum duration of 12 weeks, and the number of weekly hours worked in the placement will be 25 hours. The internships will be voluntary for both the businesses and the jobseekers and be co-designed by them to ensure that the placements meet both their needs. Again, that is an important consideration. For this to work, it has to be in the interests of the young person themselves and it also has to be seen to be of some benefit to the business sector, which will be passing on the opportunity for these young people to learn those skills with the on-the-job training provided through the internship program. It will be up to the government to ensure—and I take the caution in the spirit that it was meant—that the program is closely monitored to ensure that the employers who use the program are not exploiting and not, to use the vernacular, churning and burning young people by simply rotating them through. If they are seen to be exploiting young jobseekers they will be excluded from the program in the future.

I do want to acknowledge the contribution by members opposite, and I am sure there will be other questions that will be raised. But I would hasten to say that this is a comprehensive package that has targeted services and support for all unemployed young people. It is a well-designed package, with an evidenced-based pathway to help young Australians into the workplace. It offers, I think, a meaningful and rewarding opportunity for young jobseekers and employers a like to bridge the gap and to get young people working.

Rebekha Sharkie (Mayo, Nick Xenophon Team) Share this | Link to this | Hansard source

I will not take up too much more of the House's time, but I do have a couple of concerns. Prior to me coming to this House, this was an area of my own employment. So it is something that I am particularly passionate about. The focus of this program needs to be about young people. What I am not aware of, and what is not detailed in the legislation, is: what career mentoring will be provided to the young person to ensure they are placed in a work setting that will fit with their talent and their career goals, or will they just be shunted anywhere that suits the jobactive provider?

The minister has mentioned health and safety. In relation to my previous question, he said that it was in the legislation. But I could not see in the legislation any specific legislative protections for young people. I note that the minister, now responding to the questions, has detailed that this is not an employee-employer relationship. Therefore, my concerns are even more heightened about the protection of young people, vulnerable people—many of whom, as the minister acknowledged, have not even been in a work placement before. How do we know that they will be safe and respected in the workplace and that they will have rights and protections?

I would like to ask why jobactive providers were chosen to deliver this. Why are they in the legislation? Why not Transition to Work providers? That is a government program. We know that they tendered out the program to youth specialist providers and organisations that are recognised and well respected across the industry. They know how to work with young people and they get the best out of young people. So why would this program be working through jobactive providers and not Transition to Work?

Another query I have particularly relates to my electorate and to all rural electorates across Australia. If you are registered training organisation as well as possibly being the successful provider of this program, you will not be able to train your young people in your RTO as well as place them into employment. I understand that the government was probably trying to ensure that there was not double-dipping—it is one of those favourite words at the moment. However, when you are in a regional area, there is often one organisation and that organisation often only has one or two staff members. So it is really going to be impossible in regional and rural Australia for this program to be effectively delivered—and that is where I believe we need this program to be delivered the most.

In relation to the training, I would also like to say that, from my reading of the legislation, a young person will not receive that $200 per fortnight while they are in the training component of this program; it is only when they are in the placement. Again, how do you afford to get to training? Anyone who is on youth allowance is only getting just over $400 a fortnight to live on if they are on the independent rate. Out of that, they have to feed themselves, they have to clothe themselves and they have to cover rent. It is so far below the poverty line that the idea that we would have an expectation that a person would also get to their own training without any subsidies—which are provided under Work for the Dole but not under this program—while you are in the training component—seems grossly unfair.

I would also like to talk about the trades and industries that will be targeted. I am very concerned that this will be a program that essentially will be picked up in hospitality and in retail—areas where we know it does not take 12 weeks to train a young person. We certainly do not need any more baristas; what we need are plumbers, painters, electricians and hairdressers. We need people to work in a variety of areas where we know that there are career opportunities for young people where they will very quickly learn a range of skills that are transferrable and will have a certificate in their hand and they will not be making coffee at age 29 and waiting on tables. These young people deserve more than that.

I would like to go back to a couple of other issues that I have raised previously. I am particularly concerned about the level of ministerial discretion and administrative discretion in this legislation. The government is spending an enormous amount of money on this program—so you have got to get it right. You cannot afford to waste this money and put young people, who are our most vulnerable people, in the workforce in a worse situation.

Susan Lamb (Longman, Australian Labor Party) Share this | Link to this | Hansard source

I was sitting in my office, watching what was happening down here in the chamber and I felt compelled to come on down and speak to this. It was just over a week ago that I found myself here speaking to the Social Security Legislation Amendment (Youth Jobs Path: Prepare, Trial, Hire) Bill 2016. As I mentioned back then, Labor has always supported meaningful investment and initiatives that give young people a real pathway towards long-term, stable employment because, as I am sure the minister would agree, there is real dignity in having a job. I am a mother of four boys and they range from 16 to 26—so I am a mother and also a worker. Up until a few months ago, I was a worker just like my boys are. I know that there is real dignity in having a job. I know about being able to put food on the table, to put a roof over your head, to be able to join the local sporting team and to be a member of my community, and that comes from having a job. I know that firsthand. I would like to thank the member for Mayo for those questions that she raised and I look forward to waiting for the minister to answer them as well because I am keen to hear those answers.

The point that I felt compelled to come down and make about this proposal is that there are several elements about the program that have the potential to undermine what our country has fought hard for in the way of workforce standards. The first thing I would like to raise is that we should all be alarmed by any proposal that allows a business to pay workers below the award rate. We have heard it a number of times before. I was in my suite and I could hear the minister arguing around $4 an hour. Having 17- to 24-year-olds participate in an internship for 25 hours a week, earning $100 a week—I do not need a calculator, but I am happy to get it out of my office and bring it down to the minister if he needs a hand—that is $4 an hour. If he needs one, please pass it on that I can hand one over to him.

I have always believed in a fair day's pay for a fair day's work. We have award rates in this country because, as a society, we believe that low-paid workers should have economic security and should be protected from exploitation. In question time today, I heard the Prime Minister say, 'We back the workers.' Well, I tell you what, I wonder how that young, Queensland, 7-Eleven worker feels about that backing of the Prime Minister. I wonder how backed that worker feels when I watch the video of that. The second concern I have got is the real risk of companies cycling through young workers and using them as cheap labour. You could be working early mornings, you could be working late nights, you could be working weekends and you could work Christmas Day—nothing to stop you—in any industry at all.

In my electorate, we not only have unemployment but also have underemployment. Those are workers who are already working but are actually looking for more hours. The real risk is that they can lose their hours. You do need to look any further than Longman to have see how underemployment is playing out. At Caboolture Community Action, where they feed the hungry and the homeless—and I have spoken about this great organisation a number of times—we are seeing more and more people turning up that do have jobs but do not have enough hours. There is enough money to put fuel in the car and there is enough money to pay the rent but there is not enough money for food. That is the real story of underemployment.

As I said before, we have always supported meaningful investment. We will always support initiatives that give young people a pathway through unemployment because, like I said, I know in Longman there is nothing more dignifying than having a decent job. Over the last week, as I am sure many people have, I have been to a lot of school awards ceremonies celebrating the achievements of our children, but the one thing that parents keep asking me about, and the thing that always resonated with me, was jobs for our children. This is the stuff that is concerning for them. We cannot allow a proposal like this to go through unchecked. We must have security.

My questions—and I am happy for him to get back to me on these—to the minister are: what guarantee will he give us that people will not lose their casual hours? Those people who are underemployed already in my community, what guarantee will they have that they will not lose their casual hours that they want more of? What guarantee—and I heard the member for Mayo raise this as well—will our kids have that they will know their rights at work as they first start at a place of employment?

Ed Husic (Chifley, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Treasurer) Share this | Link to this | Hansard source

As has been evident through the course of the consideration in detail, there are quite a few members within this chamber that have expressed deep concerns about the program design that will be supported by this bill. We think this is a major new initiative by the government, which we have expressed concerns about from the get-go that this has been rushed through, not thought through and that the program design has flaws in there that could cause real problems for young, unemployed Australians. No-one for a moment is suggesting that youth unemployment in this country is not a problem; it is a problem. No-one is suggesting that new measures do not need to be considered, particularly given the performance of, for example, the Work for the Dole program that is unable to provide jobs for young Australians. Three months after they have completed Work for the Dole, nearly 90 per cent of those participants do not find work. They are not in full-time jobs. As I said during my contribution in the substantive debate, I was stunned at the blase way in which the departmental secretary said that Work for the Dole is not about finding a job. That would come as big news to the bulk of Australians who expect that a program like that will get people ready for employment. That program is tanking. This government has not found a way to reverse the slide for that program.

They have now come up with this program, a program which I note is modelled on overseas programs, and others have also observed that this has been modelled on attempts overseas to do similar things. In its submission to the Senate inquiry that is underway, the ACTU raised valid concerns, which were dismissed by the Minister for Small Business—

Joanne Ryan (Lalor, Australian Labor Party) Share this | Link to this | Hansard source

Shame!

Ed Husic (Chifley, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Treasurer) Share this | Link to this | Hansard source

In response to the member for Lalor's interjection, it will be a shame if this program fails as well and falls in a heap and we have to come back here and address those failures. In its submission, the ACTU said the United Kingdom tried a similar scheme, the Youth Employment Scheme, YES, in 2013. This scheme was launched in January 2013 and was wound up in July 2014, with fewer than half the estimated placements having been made and no clear increase in real job placements. The YES scheme, like the Youth Jobs Path program, had a top-up element for the participant, a subsidy for the employer—tick, tick; both of these things are available under the proposed program—a shorter work experience component and a longer skills development component.

That scheme tanked, so the question to the government is: if we look at overseas models, can you give assurances to the House that the model being proposed here and that is supported by this bill will actually be successful? This is a $752 million program, Minister. There is $5.7 million allocated to it in this bill. Where is the rest? Has the $5.7 million taken into account the 'cycling through'—as the member for Longman referred to it—of people? We do not know that.

The member for Longman mentioned the possibility of this cycling through. We are genuinely concerned that in some major businesses you will get a big group of these interns being brought in who will, just coincidentally, be put on weekends where penalty rates would not apply to them because they are already getting their payment. But the people who were earning those penalty rates would suddenly find that they did not have to come in for that shift. That is a big issue for people in those positions. The biggest champions of this type of program have been within the hospitality sector. They have never engaged in the jobactive program. Big businesses have never taken up those jobactive jobseekers. It has been small and medium enterprises who have done so. But we find that the ones that are quoted by those opposite when they are talking about the program are these big champions: the Business Council of Australia and AiG. Of course they would champion it. The concern is that the smaller businesses that have done the great thing by the country and have taken on more and more jobactive participants will not be the ones that are prioritised under this program. That is an issue.

We are watching this program closely. We are very concerned that people will be ripped off, that the program will fail and that it will be young people who will be forced to carry the cost, not this government, for a thought bubble announced in a budget leading into a hastily called election. Minister, there are deep concerns about this program and what it will actually achieve.

Darren Chester (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

In closing, I would like to thank members opposite for their contributions to this debate on the Social Security Legislation Amendment (Youth Jobs Path: Prepare, Trial, Hire) Bill 2016. I acknowledge the very genuine interest that many members have shown in what is an issue that has been particularly difficult for governments on both sides of this House to solve. If solving youth unemployment were easy, the government would have solved it in the last three years or those opposite would have solved it in their six years. It simply has proven to be quite an intractable issue for federal governments to manage.

The minister responsible is open to the practical suggestions that have been put forward by those opposite, and I am sure that there will be more opportunities for that conversation to occur. I think we have a shared desire across the chamber to get more young people off the dole, get them off unemployment benefits and get them into employment, and this is an important piece of legislation in that. It provides for $840 million over four years.

I take up the comments of at least one previous member who said that there is real dignity in having a job. This program is about trying to find ways to get young people work experience so they go on to have meaningful employment. We believe the package will work because it provides a step-by-step pathway for young people to deal with some of those major challenges that young people in particular face when it comes to finding employment. These challenges are a lack of employability skills, a lack of experience and difficulties in competing with other jobseekers when it comes to actually being selected for the job.

We believe that this program will have good support from the business sector, particularly in the small business sector, which is a critical employer of young people right around Australia. It is well placed to give young people that chance, that foot in the door, that opportunity to learn new skills that may well lead to their overcoming any barriers that they may face in getting established in the workplace. Once they get that first opportunity, I am very confident that they will have the capacity to develop a work ethic, which will stand them in good stead in the future.

It is important to stress—and several members have raised this issue—that under this internship approach jobseekers will receive a $200 per fortnight supplement, which is on top of their income support payment. It is important for members to recognise that. The young people participating in this program will retain their income support payment and receive a supplement on top of it. So it is not $4 per hour; it is actually a payment on top of the benefit they are already receiving, which is provided by Australian taxpayers. It is true that the employers will also receive an up-front payment in the order of $1,000 to host and intern. As I said in my previous comments, it is up to the government to make sure that any businesses found to be exploiting the system are forced off it and to provide those protections for the young unemployed people. Internships will be voluntary for both the businesses and the young people involved. They will be co-designed by them to make sure the needs of both are met. I commend the bill to the House.

Bill agreed to.