Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

Last night I was speaking on this bill, the Social Security and Other Legislation Amendment (Supporting the Transition to Work) Bill 2023, in the Federation Chamber. I will be speaking in continuance today. From 1 January 2024, pending the passage of this bill, all pensioners over age pension age and eligible veterans will have a maximum work bonus limit of $11,800, up from $7,800 currently. All new age pension recipients will have a starting work bonus income bank balance of $4,000 rather than zero to give an added incentive to maintain a connection with the workforce when they first transition to the pension. In addition, existing pensioners who haven't used their one-off $4,000 credit yet will be able to keep it in their income bank and use it at a later date. This builds on the temporary work bonus measure the government announced at the Jobs and Skills Summit. This temporary measure is in place from 1 December 2022 to 31 December 2023.

This announcement was warmly received by pensioners, stakeholders and peak bodies representing senior Australians. Indeed, many senior Australians have explained how the temporary changes to the work bonus have supported them to work more and make a real difference in their lives. That's been my experience as a federal MP when people have come and seen me in my electoral office about the issue.

The bill before the House today has permanently extended these changes from 1 January 2024 to all eligible new recipients over pension age. As a result, more than 195,000 senior Australians who start on a pension every year will be given an added incentive to maintain a connection to the workforce and continue to contribute their skills, talents, knowledge and experience to the labour market. We will be better for that. There is no doubt about that.

On top of this, the ability to undertake meaningful work has been shown to benefit the health and wellbeing of veterans in particular after military service. In opposition, I was pleased to announce our veterans employment policy, which included programs around the recognition of veterans' skills and experience and support for further study and training and support for employers. There's benefits for veterans in the legislation before the House today.

I know very well veterans bring to the civilian workforce so many transferable skills they have gained in the ADF, such as leadership, teamwork and the ability to work under pressure and a strong mission focus, but they can sometimes struggle in the transition to civilian life and the civilian workforce. They are a vastly underutilised resource. Fortunately, many do fall on their feet and end up working in areas like the Public Service, the defence industry, policing or running their own businesses. Measures in this bill will complement the government's veteran and employment policy and help ensure our community continues to benefit from their wealth of experience. There are about 7,000 veterans and their families in my election of Blair. It's one of the largest veteran populations in the country, so I know how important this particular piece of legislation before the chamber today is to them.

More broadly, mature-age workers are a great untapped market, having years of knowledge and skills to offer employers. Giving older Australians, including veterans, the choice to engage in the workforce not only will benefit them by ensuring they keep more of their pension but also is an important step towards addressing Australia's labour shortages. My electorate based around Ipswich and the Somerset region is the one of the fastest growing areas in the country, and we are experiencing severe skill and workforce shortages. Many employers are calling out for experienced workers, particularly in the health and childcare sectors and in hospitality. So it makes sense to offer incentives for older Australians to encourage them back into the workforce to share their skills and abilities.

Importantly, the income bank credit offers flexibility for those who want to take up extra work and work for short periods. There will be plenty of short-term seasonal jobs coming up over the Christmas period and the summer period also. We know a lot of pensioners want flexibility. They don't necessarily want to work all year round. They often prefer seasonal jobs. In a regional and rural electorate like mine, that is really important. There are many seniors who are doing seasonal work and enjoying it because it keeps them mentally and physically active, and their employers value them as mature workers because of their work ethic, commitment, life experience and availability particularly for mentoring, which is a crucial aspect in the workplace. It is a win-win for employers and workers.

I know many people are doing it tough on limited fixed incomes and are feeling, as they age, cost-of-living pressures. This might encourage them to engage in ad hoc work to earn a little bit more cash without their income support taking a hit. The festive season is a great time to pick up part-time or casual work, and the work bonus will help older Australians to stay engaged in the workforce while getting some extra support. These changes broaden their choices and increase flexibility while helping them to break down barriers faced by older Australians who want to be in the workforce.

The changes to the work bonus complement existing arrangements that enable age pensioners to earn an amount of income before their pensions begin to reduce. This includes the income-free area and the tapering arrangements which apply to all types of income, along with the work bonus which is specifically designed to reward pensioners who are working. It provides incentives that mean pensioners with employment income can earn more before their pensions are affected. That's the best way to target additional support for pensioners who want to take on extra work.

Alongside the changes to the work bonus are amendments to double the existing employment income nil rate period to provide support to income support recipients when they take up work. The employment income nil rate period is available to recipients for a range of payments—including JobSeeker payment, youth allowance, Abstudy living allowance, Austudy, parenting payment and pensions—and enables income support recipients to be considered as still receiving their payment when their fortnightly rate is reduced to nil, due to personal or partner income, for the purpose of qualifying for supplementary benefits. This is an important measure. I know it's critical for my electorate and for the many people I've spoken to about these issues. They are sensible, practical, targeted changes, and they complement our economic inclusion measures to strengthen the safety net and tackle cost of living in the May budget. With these, the government's providing additional support to working-age and school payment recipients as well as support through Commonwealth rent assistance and expanded access to parenting payment single. These measures are doing a lot to help Australians of all ages get into the workforce and keep our objective to remove barriers to employment and broaden opportunity for all Australians.

I commend the bill to the House.

Amanda Rishworth (Kingston, Australian Labor Party, Minister for Social Services) Share this | Link to this | Hansard source

I'd like to thank all of those who have spoken on the Social Security and Other Legislation Amendment (Supporting the Transition to Work) Bill 2023, which implements two of the immediate actions the government is taking to deliver on the objectives of our employment white paper.

The changes in the bill will permanently enhance the pensioner work bonus and extend the employment income nil rate period for those on income support, helping to remove barriers to employment and broaden opportunity. It includes amendments to permanently establish the government's temporary changes to the pensioner work bonus that we announced following the Jobs and Skills Summit, giving older Australians more choice and continued flexibility to participate in the workforce if they would like to.

Through this bill, all new eligible pension recipients will have a starting work bonus balance of $4,000 instead of $0. This will mean that, from the outset of commencing on the pension, new recipients will be able to earn more before their pension rate is affected. In addition, we are also retaining, on a permanent basis, the maximum income bank balance of $11,800 for all eligible pensioners and veterans to accrue in their work bonus income bank. These changes are designed to take effect from 1 January 2024 to ensure there's no gap between the end of the current temporary work bonus measure on 31 December 2023. If this bill does not pass in time, the work bonus will revert to its old settings and around 2.35 million pensioners will see their income bank balance reduced and new pensioners will not get a starting balance of $4,000. With these positive amendments we are giving greater scope to all eligible pensioners to earn more income from work before their pension is reduced or cancelled, and greater choice and increased flexibility to participate in the workforce.

I inform the House that we will not be supporting the member for Deakin's second reading amendment. Of course, we reject entirely the points made in that, including that this government is not acting when it comes to cost-of-living relief. Indeed, this government is absolutely acting in a targeted, responsible way for cost-of-living relief. We also don't believe that the proposal put forward by the member for Deakin will adequately ensure that pensioners are encouraged to re-enter the workforce. Our government has thought very carefully about the importance of the starting balance and the higher income bank, so that it does incentivise, particularly, newer pensioners or pensioners coming onto the system to continue to add their skills, knowledge and expertise to the labour market. Our change, also with the increase to the maximum income bank balance cap, will allow for more flexible use by pensioners about when and how they take up that extra work.

Enhancing the work bonus is a priority for this government. This bill also doubles the employment income nil rate period for income support recipients, from 12 to 24 weeks, from 1 July 2024 and extends access to recipients who begin full-time employment. This change is designed to provide more support for people to get into work without the fear that the social safety net won't be there for them when or if they need it again—in particular, a benefit for people receiving the JobSeeker payment and youth allowance (other). It will enable income support recipients to take up employment while retaining access to benefits such as the healthcare card, childcare subsidy and some supplementary payments, and stay active in the system for longer. This measure is designed to smooth the transition from income support into employment and to encourage income support recipients to take up work opportunities, particularly those that might be ad hoc or short-term roles that could turn into longer term work opportunities. Smoothing the transition from income support into employment is incredibly important.

With the measures in this bill, the government is doing more to help Australians of all ages get into work, consistent with our objectives to remove the barriers to employment and broaden opportunities for all Australians. I commend the bill to the House.

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

The original question was that this bill be now read a second time. To this, the honourable member for Deakin has moved as an amendment that all words after 'that' be omitted with a view to substituting other words.

Milton Dick (Speaker) Share this | Link to this | Hansard source

The question is that the amendment be agreed to.

Milton Dick (Speaker) Share this | Link to this | Hansard source

The question now is that this bill be read a second time.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.