Rachel Siewert (WA, Australian Greens) Share this | Hansard source

We think that the Social Security Amendment (Liquid Assets Waiting Period) Bill 2009 is very important and we are pleased that the government have moved on it. They actually moved on it in response to the Greens putting it to the government in discussions over the economic stimulus package, because we felt that this was a significant way that the government could help working Australians in this time of economic crisis. This bill cushions the blow for Australian workers who lose their jobs by raising the threshold of the amount of money that they can have in savings before they can go on unemployment benefits. You would have thought this would have been something that the government would have thought of themselves and been worried about in response to the global financial crisis, with unemployment already rising and, unfortunately, projected to rise much higher. Bear in mind that it was the previous government, the Howard government, that cut the threshold of the liquid assets test quite substantially. We were extremely pleased when the government saw that this was a sensible and practical amendment that could be made to improve the stimulus package, and they committed $50 million to ensure that this could occur.

I must admit, I was very angry at the government. When introducing the bill, the Rudd government in no way gave the Greens any credit for the fact that this was a Greens initiative. I am extremely disappointed that they could be so mean-spirited as to fail to acknowledge that it was the Greens’ idea and the Greens who negotiated this commitment from the government. Having said that, I am, of course, pleased that they are doing it; I am just a bit disturbed that the government decided that they would not acknowledge that the Greens were looking out for working Australians who will benefit from this very important amendment. Brendan O’Connor did not mention it in his second reading speech or in any of his media statements. To add insult to injury, the minister went to great lengths to present this as an ALP initiative by pointing out how the ALP had opposed the changes introduced by the Howard government which reduced the threshold from $5,000 to $2,500. The ALP did not fix it on their own initiative; they did it once the Greens put it to them and raised this issue.

I am very glad that these amendments are being made. I am glad that the government are fulfilling their promise. This is one example of how the Australian Greens have attempted to redirect the stimulus package and other aspects of government legislation to ensure that in this time of financial crisis we focus our efforts to look out for those who will be the hardest hit by the downturn. We need to cushion the blow for those people who will lose their jobs and ensure that those people and their families are looked after through these tough times so that they are ready and able to get back into work and can play a key role in driving economic recovery as we come out of the other side of this downturn. We are concerned that too much of the two stimulus packages was focused on throwing money around willy-nilly instead of focusing on efforts that not only stimulate the economy but also help those worst affected by this downturn. The Greens do support the need for immediate stimulus, but we believe that in spending our limited resources we should also have an eye for the longer term future and for those that are most at risk from the economic downturn. The best way to get the most out of our limited budget is to target our efforts at measures that build the new green economy of the future and strengthen the safety net for those on the receiving end of job losses, facing mortgage defaults and facing the credit crunch.

The liquid assets test threshold will increase from $2,500 to $5,000. There is a sunset clause which the government have introduced in this particular piece of legislation. We believe that this should be indefinite, but, of course, we understand that the government have included the sunset clause because they think the downturn will last a short period of time, so this will not be as necessary in the future as it is now. We believe that the increased threshold of the liquid assets test should be there permanently. We hope that the government will give an undertaking that, if people are still suffering when the sunset clause comes around, the government will reconsider that clause so that, if we are still in unfortunate economic circumstances, people will not suffer as people are suffering now prior to the introduction of this particular measure.

When you lose your job and apply to go on Newstart allowance, you have to go through a series of NSA asset tests before you can get any income support. One of the most punitive features of NSA is the liquid assets waiting period. Liquid assets are defined as cash and bank deposits, including term deposits, shares and so on. You could be required to serve a waiting period of between and one and thirteen weeks if your liquid assets exceed $2,500, or $5,000 for a couple. This amendment puts this threshold back up to $5,000 and $10,000 respectively, which is where it was before the Howard government made the changes. These are small amounts, and the whole point of this test is, it appears, to be highly punitive. The test is in addition to the income maintenance period, which affects payments for a period of time based on the accrued leave paid out as a lump sum. In effect, it says that the benefits of all your hard work and careful savings need to be eroded before we will help you out.

The Australia Institute has been very active on this point and in fact made a submission to the committee inquiry into the Nation Building and Jobs Plan and made a series of very important points around these particular issues. They said:

While the liquid assets waiting period is partly aimed at those who have received a termination payment from their last job, the philosophy behind it is in complete contrast to the insurance philosophy of most OECD countries whereby unemployment payments are payable simply because of the contingency of job loss.

The Australia Institute estimated that to abolish the liquid assets waiting period altogether would have cost around $500 million per annum.

We believe that this is an important move. In these times of economic downturn, we need to ensure that we remain a caring society that looks after the people who are most adversely affected. Despite my concern about the fact that the government did not acknowledge that this was a Greens initiative, we are pleased that they took it up. I am very happy to see this legislation. They have kept their commitment to introduce this legislation in order for it to start on 1 April. It will make a significant difference for hardworking Australians who, through no fault of their own and because of the economic downturn, are going to be facing hard times. If they lose their jobs, they will be facing very hard times. This will in small measure—there are a whole lot of other things that we need to be doing—help those struggling Australians and ensure that they and their families get the support that is needed.