Mitch Fifield (Victoria, Liberal Party, Assistant Minister for Social Services) Share this | Hansard source

I thank colleagues for their contributions. Colleagues have well canvassed this bill that we will introduce for the 2015 budget measures in the social services portfolio, along with certain other measures from the 2014 budget and earlier fiscal decisions. The 2015 budget measures incorporate the reintroduction with modifications or the replacement of three 2014 budget measures introduced previously.

The one-week ordinary waiting period that currently applies to the NewStart allowance and the Sickness Allowance will be extended to the Youth Allowance (Other) and the Parenting Payment. This measure modifies last year's budget measure so that Widow Allowance claimants will not be affected. The one-week waiting period is designed to encourage people to support themselves in the first instance where they are able to do so before seeking income support. The existing severe financial hardship exemption from the ordinary waiting period will be retained, but a new requirement introduced is that the person is also experiencing a personal financial crisis. This could include domestic violence or unavoidable or reasonable expenditure. This will better target the exemption to those who are most vulnerable and most in need of immediate assistance.

The bill currently provides for these amendments to start on 1 July 2015, but government amendments will provide for a new start date for the measure. From 1 July 2016 the age of eligibility for the NewStart allowance and Sickness Allowance will be increased from 22 to 25. Young jobseekers between the ages of 22 and 25 will be able to apply for Youth Allowance instead. This measure delays the start date of last year's budget measure by one year to 1 July 2016. Young people aged 22 to 24 and already in receipt of NewStart allowance or Sickness Allowance on 30 June 2016 will not be affected and will remain eligible for these payments. This measure will broadly align rates of payments for young unemployed people with the rates for young people studying full-time. Currently NewStart and Sickness allowances are paid at a higher rate than Youth Allowance. This can act as an incentive for young people aged 22 to 24 to either give up full-time study in order to access NewStart allowance or stay NewStart allowance instead of pursuing full-time study to aid their transition into work.

The changes to the age of eligibility will remove this incentive by placing all young people aged under 25 on Youth Allowance irrespective of whether they are unemployed or studying full-time. There is more flexibility to earn while on Youth Allowance. The income free areas are higher before payment is affected and so this change will strengthen the incentives for young unemployed people to work or pursue education and training opportunities.

The 2014 budget measure, stronger participation incentives for jobseekers under 30, which sought to introduce a six-month waiting period for those under 30 applying for NewStart allowance, Youth Allowance or Special Benefit will no longer be implemented. Instead, this bill introduces a four-week waiting period for those under 25 applying for Youth Allowance (Other) or Special Benefit. This measure forms part of the Youth Employment Strategy in the Growing Jobs and Small Business package. This measure will start 1 July 2016 and will only apply to jobseekers assessed as job ready in Stream A of jobactive. We know that in New Zealand when a similar measure was introduced 40 per cent of job seekers did not go on the payment; they went out and got a job rather than completing the pre-entry requirements. This evidence supports our approach.

During the waiting period young people will be required to undertake pre-benefit activities through a new program, Rapid Connect Plus, which will help them to prepare for and find work. These pre-benefit activities will include meeting with a jobactive provider, agreeing to a jobactive plan, developing an up-to-date resume, creating a jobseeker profile on the Job Search website and submitting up to 20 job applications. Jobseekers who have been assessed as having significant barriers to work will not be required to serve the four-week waiting period. This will include people assessed as Stream B or C of jobactive, parents with 35 per cent or more care of a child and young people in or leaving state care.

In this bill there are amendments to see that anyone who is incorrectly classified as Stream A when they should be B or C will be back paid. This is a significant amendment and will further protect Stream B and C jobseekers. Exemptions from the four-week waiting period will also be available to jobseekers with the temporary activity test exemption of more than two weeks, such as pregnant women in the six weeks before they are expected to give birth or people testing their eligibility for the Disability Support pension.

In recognition of the importance of education and training in preventing future unemployment, young people who return to school or take up full-time vocational education or university study will be able to access student payments, such as youth allowance student, without having to serve a four-week waiting period. Under the Growing Jobs and Small Business package, there will be additional support options for young people with a mental illness— (Time expired)

Debate interrupted.