James Paterson (Victoria, Liberal Party) Share this | Hansard source

I am very pleased to be rising to speak in support of the Economic Recovery Package (JobMaker Hiring Credit) Amendment Bill 2020, as it goes to the core of one of the issues that I came here to fight for and that I spoke about in my first speech—that is, the dignity of work. The economic benefits of work are obvious. A steady pay cheque provides financial security for individuals and their families, and it allows them to plan for the future with confidence. Material living standards like these should never be lightly dismissed. Of course, it also provides tax receipts for government, which allow us to fund the important things that we all value, like a strong national defence and a social safety net. But, in some ways, even more important than these financial benefits are the other benefits that come with work, often described as the dignity of work. I want to briefly dwell on these important philosophical points before I turn to how this bill supports this objective and provide some reflections on why it is particularly needed in my home state of Victoria.

The concept of the dignity of work is most closely associated with Catholic theology. As senators may know, I'm not personally religious, but I have a strong appreciation for their social teachings. The concept has been very well summarised by John Coleman, who wrote in the Jesuit review America:

… work not only implies remuneration sufficient for adequate housing, food, medical help etc. but also involves a kind of justice as participation. Through work we participate in society and have an active voice. Thus, even if welfare for those who can not find work or can not do it for physical reasons is a good thing, it is no substitute for the dignity which accrues to those who actively participate in work and in society.

This is strongly supported by the evidence available to us from social science research. We know that people engaged in paid employment report much higher levels of seemingly unrelated measures of wellbeing. They are happier, they are healthier and they are better connected to their communities than people without work. This shouldn't surprise us if we reflect on what it means to have a job. A job provides not just an income and opportunities for socialisation and engagement but a sense of self-belief and confidence. As humans, we have a deep need to be needed by others, to be of value to them. Of course, it is possible to fulfil this need outside of work—for example, in our families and through civil society—but, for most people, there is no substitute for paid employment in delivering this sense of value. For many people, the routine and the obligations that are imposed on us by work provide the healthy structure that we need to thrive. Conversely, we also know that unemployment can have a profoundly negative affect on your health and happiness. In particular, we know that long-term unemployment is terrible for our sense of pride, our connection to community and our health and happiness. It truly is a social evil which must be fought.

Sadly, we also know that, coming out of an economic crises like this one which has been caused by COVID-19 and the tough restrictions that have been imposed by government in order to fight the health crisis, many more Australians will be without work and all that that comes with it—all that dignity that comes with it. This is no more so, sadly, than in my home state of Victoria, which has been hit particularly hard, thanks to the second long and very painful lockdown that we have endured. As a result, there will be many more job losses and business failures in Victoria than in the rest of the country. Right now, there are more than half a million Victorians who have lost their jobs since the beginning of this crisis. While the rest of the country has been recovering because they were able to get on top of the health challenges posed by COVID-19 and because they didn't encounter the issues that we unfortunately had in Victoria with hotel quarantine, which re-released the virus into the community after Victoria had effectively achieved elimination of the virus like all other states and territories, ABS figures show that Victoria has continued to decline in the second half of this year. There were 73,000 Victorians laid off in August and September alone, while another 81,000 left the labour force completely—those potential discouraged workers who have left and are no longer seeking any further employment. Another 58,000 of them had their hours reduced, and 112,000 Victorians who were employed in September did not work any hours at all, often either having been stood down from their employment or being in so-called zombie firms which for now are supported by JobKeeper but which we know will not be viable forever and in perpetuity. At 14.9 per cent, Victoria's underemployment rate is the highest in the nation. That's a combination of those who are, sadly, without work at all and many others who are seeking more work than they can currently obtain, more hours than they are currently being given.

The bitter experience from previous recessions is that even when economies do bounce back quickly in terms of GDP growth figures and other metrics, bumping out of a technical recession of two negative quarters—and we certainly hope that's the case in Australia this time around—it still takes many years to regain precrisis levels of employment. That's the experience not just in Australia but internationally. Employment, sadly, is a lagging indicator of an economic recovery. Given the importance of employment to people's dignity and self-worth, it is so important that we speed up that process as quickly as possible. Sadly, we know that some people will leave the workforce during this time never to re-enter it. They will go on to other forms of support, like the disability support pension, the age pension or Newstart, and won't return to the employment market at all.

Young people are particularly hard hit by recessions. Young people who graduate from school or other forms of tertiary education in a recession take longer to find a job, are paid less and have fewer opportunities for advancement than their peers who graduate in better times. It truly is a lottery of timing. Through no fault of their own, just the time that they were born and time they are graduating from education, if they happen to graduate in a recession, we know that they'll suffer significantly reduced economic opportunities as a result. It can take decades to overcome this so-called scarring of the labour market.

Programs like the JobMaker hiring credit are not solutions on their own, but they do form an important part of a package of wider forms which are designed to get people back into work as soon as possible. Along with personal income tax cuts, incentives for businesses to invest and record infrastructure spending, the JobMaker hiring credit will spur the creation of new jobs to combat this evil of unemployment. Wider economic reforms will also be necessary, including to industrial relations to ensure there are as few barriers to job creation as possible. Like many, I am eagerly awaiting the outcome of the Minister for Industrial Relations' consultation with business and unions. I'm hopeful that some of the old rivalries, which we know have dominated these debates and prevented reform in the past, can be put aside to ensure our economy is freed up as much as possible to create new jobs. It is remarkable to reflect for a moment that the Fair Work Act, which we operate under now and which was enacted by the Rudd government shortly after it came to office in 2007, has largely remained untouched and unchanged for 13 years. There's been no progress at all on industrial relations in that time. I think it is clearly going to be a barrier to that bounce-back if it is not addressed. So I'll be eagerly awaiting the reforms, which I hope come with consensus between business, unions and government, out of the discussion led by Christian Porter.

The JobMaker hiring credit will support around 450,000 positions for young Australians and will cost about $4 billion. Each additional employee aged 16 to 29 years of age will attract a credit of $200 a week for their employer. It will be $100 a week for workers who are aged 30 to 35. Contrary to contributions by other senators in this chamber, including Senator Waters, who spoke prior to me, there will be a range of safeguard mechanisms in place, both in this legislation, in the subsequent regulations to be issued by the Treasurer and in the protections that exist under the Fair Work Act through the Fair Work Commission, that will ensure that this money goes only to the creation of new jobs, and that existing workers will not be disadvantaged or displaced in any way by this scheme. There is no reason to think that they will be, because many employers are in fact reporting difficulty in finding appropriate workers and a desire to add to their employment numbers, as indeed they will be required to do under this legislation. In order to receive a benefit, they will have to demonstrate a net increase in employment. So there's no reason to think that those fears will be realised but, just in case, the government will of course be putting in place very strong safeguards to ensure that doesn't happen.

To briefly recap: the JobMaker hiring credit is one really important part of the Treasurer's plan, set out in the budget a month ago, to get Australia to build back better after this crisis, to bounce back as quickly as possible and to return to the strong and prosperous economy we had enjoyed before this unanticipated crisis hit from overseas. It was unfortunately unavoidable that Australia, along with every other country in the world, would suffer some form of recession as a result of this crisis and the measures we had to put in place to safeguard Australians' health. However, we can make sure that on the other side we get back to that level of prosperity and security for Australians by giving them not only the economic benefits of work but also the associated social benefits of work and the dignity of work.