Jacinta Collins (Victoria, Australian Labor Party, Parliamentary Secretary for School Education and Workplace Relations) Share this | Hansard source

I should briefly address a couple of the issues raised by Senator Siewert. I do not think the government has any argument with her at all in relation to the gap between Newstart and parenting payment growing over time—and this is one of the concerns that is being addressed with respect to Newstart. It is quite a separate issue from what is being addressed here. But I do think it is unarguable that employment opportunities, particularly for the people who would find themselves receiving parenting payment, have improved considerably since 2005.

I should also add to that the list of measures that I indicated I could go to. Since Senator Siewert has encouraged me with the suggestion that things have unquestionably gotten worse, perhaps I should. The government has already made amendments to the Social Security Act 1991 to reform the income test that applies to single principal carer parents on Newstart allowance from 1 January 2013, allowing these parents to earn about $400 more per fortnight before they lose eligibility for payment. This provides stronger incentives for parents to undertake paid work by allowing parents to retain more of their income as their employment income rises.

To ease the transition to work and overcome the barriers parents face, from 2011-12 the government has invested in training, with additional funding of $100 million for skills development for single and teen parents and more than $7 million in career advice assistance, as well as supporting parents through employment services and child care. Single parents who are studying an approved course and are receiving the pensioner education supplement when they transfer from parenting payment to Newstart allowance will remain eligible for the pensioner education supplement until they complete the course that they are studying. The government is providing additional funding to support increased demand and better target the Jobs, Education and Training Child Care Fee Assistance program.

The more generous taper rate for single principal carers on Newstart allowance put forward in the 2011-12 budget will lessen some of the impact of the earlier cessation of grandfathered status for parenting payment single recipients. For new and existing Newstart allowance single principal carers—this is a benefit for existing single principal carers who were not grandfathered—the change to the taper rate will reduce the effective marginal tax rate for these parents, provide greater incentives and rewards to engage within the workforce, and alleviate poverty in that respect. I should also highlight the changes to the tax-free threshold, a significant improvement in income for people in these circumstances.