Chris Ketter (Queensland, Australian Labor Party) Share this | Hansard source

I rise to speak on the matter of public importance requested by Senator Gallagher today—that low- and middle-income Australians are continuing to lose out under the Turnbull government—but before I turn to those comments, with the indulgence of the Senate I want to place on record my thoughts and prayers for North Queenslanders, particularly those in Bowen, Airlie Beach and Proserpine who at the moment find themselves with roads cut. I want to express our solidarity with those people. I also note with some gratitude that the last time I checked there had been no reports of injury so far from the Whitsunday Islands. I also note the prospect of major flooding of the major rivers north of Ayr to the New South Wales border. I reiterate the very good advice that the state authorities provide: if it is flooded, forget it.

It is quite disappointing that, in a week in which we are discussing and looking at the issue of penalty rate cuts and the inaction of this government in relation to those penalty cuts, we also a see a government demonstrating its twisted priorities by continuing to pursue as its central economic piece of work the enterprise tax plan, which at its heart is a $50 billion tax cut for big businesses and, as part of that, a $7.4 billion tax cut for the major banks and also a very generous windfall for multinational companies. This displays the treatment that this government is meting out to low- and middle-income Australians. We see this every day: a government that fails to act, fails to lead and fails to secure a prosperous future for everyday Australians. A strong middle class is a source of growth, not just a consequence of it.

The Prime Minister's trickle-down rhetoric of tax cuts for the rich, big business and big banks is an impediment to the growth that we need. The living standards in middle Australia have supported our economy in a period when run-away inequality and wealth concentration has destabilised both the economies and the politics of the US and much of Europe. However, we are not immune to such effects. Under the failed leadership of both Prime Ministers Malcolm Turnbull and Tony Abbott, growth, particularly in the middle class, has shrunk significantly. These are the alarming economic facts facing middle Australia: the economy is growing below trend; the unemployment rate has increased and is now close to six per cent; and underemployment is at record highs. There are fewer full-time jobs than there were a year ago and wages growth is at record lows. What is the government's response to these issues? Backing in penalty rate cuts that impact those on low and middle incomes.

I have already said in this chamber today that I agree with the assessment of the Treasurer that low wages growth is one of the greatest threats to our economy. If one accepts that as a premise then the attacks on the take-home pay of 700,000 low-income workers would have to be a disaster for economic growth for the future, as well as being a disaster for the people affected by those cuts. The 2011 ABS census confirms that workers in the affected industries are amongst the lowest paid in Australia. These cuts to wages severely impact those who are struggling most to make ends meet, particularly students and others who rely sometimes solely on weekend penalty rates. I note that the state Minister for Employment and Industrial Relations in Queensland has issued some figures as to the number of employees in parts of Queensland who are award-reliant retail and hospitality workers who work on a Sunday. We can see that in Cairns there are something like 2,300 workers; in Townsville, 2,000 workers; in Mackay, 2,000 workers; in Fitzroy, 2,100; in the outback of Queensland, 787; in Wide Bay, 2,500; in the Darling Downs-Maranoa, 1,270; in Toowoomba, around 1,200; on the Gold Coast, 7,400; and on the Sunshine Coast 4,230. These are the people who are behind the statistics on the impact of these penalty rate cuts.

In April 2015, the McKell Institute conducted a study as to the economic impact of penalty rate cuts in Australia's retail and hospitality industries. The findings of that report were not surprising and predicted the harmful effects of the Fair Work Commission's decision. They found that the cuts to penalty rates in these industries would:

… result in a commensurate reduction in the disposable income of those workers, leaving less money available for spending on local goods and services.

The McKell Institute conducted studies following the decision and found that the lowest income earners who rely heavily on penalty rates would be most adversely affected. In their February 2017 report, the institute found full-time and part-time employees in the retail industry not covered by an enterprise agreement would lose at least $72.90 per eight-hour Sunday shift. Casual retail workers would face losing a minimum of $45.56 per Sunday shift. In 2016, a report entitled Choosing opportunity identified one of the many challenges associated with being a low-income worker, such as owning a home and being able to afford basic services and amenities in the near stagnant wage growth of recent years. The Prime Minister suggested that penalty rates could be offset by normal wage increases over time. The Australia Institute calculates that, at current wage growth rates, it would take 17 years until higher wages for retail workers would offset the damaging consequences of this decision.

Another issue where the Turnbull government has failed low- and middle-income workers is in relation to housing affordability, which is a key factor when it comes to inequality. But before I touch on that point, I would also like to quote from a recent article that goes behind the statistics to talk about the people who are affected by these penalty rate cuts. I note a recent news.com.au article, which states:

A Brisbane woman, who did not want to be named, is “stressed” knowing her pay packet is dwindling.

“I work for a fine dining restaurant in the Brisbane CBD (and) it’s stressful knowing that you’re going to be doing the same amount of work, but taking home less pay,” she said.

There are also other workers mentioned in that article. These workers are entitled to feel that this government has forgotten all about them, that they are collateral damage when it comes to this government's twisted priorities.

With respect to housing affordability, while finance to housing investors has rocketed up by more than 27 per cent over the last 12 months, low- and middle-income Australians are increasingly being locked out of the Australian dream of owning their own home. First home buyers in the market are still at near record lows. While the government continues to talk about housing affordability, there has been little or no real action over the last 12 months. All the while, house price growth in Sydney has been running at 19.2 per cent and in Melbourne at 14.2 per cent. Demographia's 13th annual International Housing Affordability Survey also showed that Sydney, Melbourne, Adelaide, Brisbane and Perth are in the top 20 least affordable housing markets.

While ordinary Australians are being locked out, the government seems to be using this issue as a way to wage factional wars, with one side considering capital gains tax reform and the other being ideologically opposed to tax increases. One side embraces the silly idea of accessing superannuation to make a deposit and the other side, wisely, tries to rule it out. It is hard to know what the government's housing affordability policy actually is, as it seems to change with every passing day.

The Turnbull government has turned a blind eye to the issues of inequality facing our nation. Whether it is cuts to penalty rates or housing affordability, the Turnbull government has failed low- and middle-income Australians.