Jenny McAllister (NSW, Australian Labor Party, Shadow Cabinet Secretary) Share this | Hansard source

It's disappointing to hear the minister indicate she's not willing to support Labor's amendment. Listening to her answers to questions posed by Senator Siewert, it is very clear that the government is operating on a deeply flawed understanding of how the Australian economy works, of how the labour market works and, indeed, of what the impact of these changes will be on communities all around the country, in particular regional communities. Let's be clear what the effect of the Social Services and Other Legislation Amendment (Extension of Coronavirus Support) Bill 2020 is: this is a bill that confirms the return to the $40-a-day rate for JobSeeker at the end of March and it cuts the rate of payment from 1 January next year. There are some good things, of course, about the bill. It continues the coronavirus supplement for youth allowance student and apprentice recipients after December, which is important. It continues the more generous income-free areas and taper rates in partner income tests. Those things are important. But, at the heart of it, because of an ideological belief about people who suffer from unemployment being somehow at fault for their own circumstances, somehow indolent, somehow not interested in work, this bill essentially seeks to cut support provided to people who are unemployed.

Colleagues on this side of the chamber have been putting a very simple proposition to the relevant minister, Senator Ruston, and others on that side and it's this: this bill does represent a cut to the coronavirus supplement at a time when the economy cannot afford it. This is a case of very simple mathematics. The supplement started out at $550 a fortnight, effectively doubling JobSeeker. Then from 20 September it was reduced to $250 a fortnight and from 1 January next year it'll be reduced further to $150 per fortnight. Now, the mathematics on that are pretty straightforward: $250 is lower than $550; $150 is lower than $250. If the government want to cut the coronavirus supplement, they should be up-front about that, because that would make for a more honest debate, at the very least, about the amendments before us now and some of the other amendments that we'll be considering in the committee stage.

The cut in support is happening and will be happening, and the context for that is desperate. Here are some of the facts: there are 1.8 million Australians who are expected to be on unemployment support by the end of the year. Unemployment is expected to continue to rise. The OECD suggests it will hit 7.9 per cent next year, and that will be beyond the experience of many Australians, particularly younger Australians who haven't experienced very high levels of unemployment. The OECD is pretty clear about the remedy for this kind of thing and pretty clear about the risks in the policy decision-making. They have warned us about premature cuts to vital support, fiscal support delivered through mechanisms such as the coronavirus supplement, saying that cuts at this time could risk jobs and the economy. You can ignore that advice if you come into this chamber and you say that what you're doing is not a cut, but it's a silly semantic argument. We are experiencing the worst recession in a hundred years. It is not a time for silly semantic arguments. It is a time for grappling with the serious economic circumstances that are facing Australian families, Australian workers, Australian communities and, frankly, Australian employers. The cuts contained in this bill, the cuts anticipated in this bill for next year, will have implications for all of those participants in the economy.

This government likes to talk about employers a lot. This government isn't very interested in people who work for a wage. They're very interested in employers. We on this side of the chamber are interested in all of the participants in the economy and we're interested in structuring an economy that will work for everybody. Part of that means that businesses and employers need to be operating in an environment where there is demand for their products and services, and all of the advice before us suggests that withdrawing fiscal support at this time presents a very serious risk to economic performance. The exposure to that risk is not just to people presently receiving benefits through JobSeeker; it's spread right across the economy. I tell you what, it will hit hard in regional communities, like the community that I came from in northern New South Wales. It will hit a lot harder there than it will in some of the more affluent suburbs that some of those opposite are more familiar with and prefer to frequent. It will be noticed in regional communities, because this is a recession with very uneven effects. I am very worried about the communities that I know and love in my home state and the approach to economic policy being taken by this government.

It's not just the OECD warning us; the Reserve Bank are also expecting a further rise in unemployment. They expect, as the best case, that unemployment will be above prepandemic levels as late as 2022. There are still far more jobseekers now than there are job vacancies—many, many more. The vacancy report put out by the National Skills Commission showed that there were 155,000 vacancies in October. That compares with data from the Department of Social Services showing there were over 1.3 million people on JobSeeker in October. What does that really mean for people in the labour market? It means when they're going out looking for a job they're facing a lot of competition. Those jobs are just not there. Many, many more people are dependent on benefits provided by government and, as I've indicated already, the consequences of that dependency flow into the businesses and communities in which those people live.

Instead of reverting to $40 a day for JobSeeker, the government should be permanently increasing the rate. That's not contemplated in this bill. In fact this bill anticipates the circumstances where the coronavirus supplement comes to an end very soon. There are 1.3 million Australians currently on JobSeeker, and they've been through a lot this year. They've experienced uncertainty—personally, financially, psychologically—and they're facing down a very uncertain Christmas and a very uncertain new year. They'll be wondering what level of support will be available to them after 31 March next year. That's the date when JobSeeker drops back to $40 a day. All those people, some of whom haven't experienced unemployment before, will be facing a very uncertain labour market and very low rates of vacancies. They'll be rightly worried. They will be worried about how they'll pay the bills, how they'll put food on the table and how they'll pay their rent. It will make for an uncertain Christmas.

I do wonder about the motivation of those opposite in leaving that uncertainty in place at a time when—surely, after all that has happened this year—people deserve the capacity to have a secure Christmas with family and some certainty about what next year might bring for them economically. It's true for business too and I've talked about that already. It isn't just the recipients of benefits that we should be concerned about. These recipients are spending in small businesses locally. They play a vital role in helping to create and sustain jobs, and that is incredibly important as we emerge into a COVID-normal situation.

This amendment is not a radical amendment. It's an amendment that is tailored to the economic circumstances we find ourselves in. It asks the government to provide certainty for people who are experiencing great uncertainty at the moment.