Mitch Fifield (Victoria, Liberal Party, Manager of Opposition Business in the Senate) Share this | Link to this | Hansard source

I rise to speak on the Social Security Amendment (Parenting Payment Transitional Arrangement) Bill 2011. The purpose of this bill is to amend provisions within the Social Security Act 1991 that relate to the transitional arrangements that came into effect for parenting payment from 1 July 2006. In practical terms, this bill will limit the ability of parenting payment recipients to extend—and I hesitate to use this word—'grandfathered' eligibility status by acquiring new parenting payment children. I understand now that inclusive language has transformed 'grandfathered' as a term into 'grandparented.'

Claire Moore (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

I believe that is true, Senator.

Mitch Fifield (Victoria, Liberal Party, Manager of Opposition Business in the Senate) Share this | Link to this | Hansard source

Thank you, Madam Acting Deputy President. Any subsequent children that come into a parenting payment recipient's care will not be covered by the grandparented provisions. This will mean that all parenting payment recipients will be treated with a degree of equality not available to them previously. I indicate the coalition is not opposed to this bill.

Rachel Siewert (WA, Australian Greens) Share this | Link to this | Hansard source

Madam Acting Deputy President, thank you for your graciousness in allowing me to speak on the Social Security Amendment (Parenting Payment Transitional Arrangement) Bill. I will admit I was in the Opposition Whip's rooms with the class of 2004, saying farewell to some of our colleagues. So thank you for holding my spot for me.

People on income support are looking for the best outcomes for their families. The Australian Greens believe that they need encouragement, support and incentives to assist them to find meaningful employment that suits their needs and improves their standard of living. We should be offering as much support as possible. We should particularly help single parents not only to find employment but also to support their children. In most cases, helping people to find employment that they can mix with their child-rearing responsibilities is particularly important.

Many people will know that the Greens opposed the previous government's punitive welfare-to-work provisions. We continue to oppose the welfare-to-work provisions and have been critical of this government because of its continuation of many of these measures and the hardening-up of its punitive approach. Later in this place I will also be talking to the Social Security Legislation Amendment (Job Seeker Compliance) Bill, which I am equally critical of.

The Greens do not believe that the approach of welfare to work initiated in the Howard era was the appropriate way to go. It included forcing single parents from parenting payment single onto Newstart, hence dropping their income. Statistics show that over 30 per cent of people on parenting payment single are already working and many other people are actively seeking work where they can combine their parenting responsibilities with work. Not only have they been facing many barriers up until recently but also there have been many disincentives to work through the very system itself where the tapering rates have not been an incentive for people to get work.

We are very keen to encourage and support people to undertake further training and education to address Australia's skills crisis and we believe very firmly that support should be given to those on parenting payment single who require support to undertake more training. We acknowledge that the government has moved some way towards this, but we are still critical of its approach. I will be going into that in more detail when we discuss the Family Assis­tance and Other Legislation Amendment Bill, for example.

We do not believe there are enough training places or employment assistance to help people that are on income support or to adequately help those that will be pushed onto Newstart through further changes to welfare-to-work provisions. We do not believe there is enough genuine support to help people. We actually think the government is being a bit schizophrenic here. On the one hand, it is investing in some more incentives—and we are supportive of that—but, on the other hand, it is continuing to demonise people and take a punitive approach to those that are on income support. It seems to be an approach whereby the government acknowledge that people need encouragement—they have obviously been reading the papers from the Social Inclusion Board, and I will go into that in a bit more detail—but they cannot help but then try to demonise people by implying that those on income support are there because they are bludgers, with the bad back syndrome et cetera, rather than acknow­ledging that those who remain on income support face real and complex barriers to gaining meaningful employment and attempting to stop the cycling in and out of employment.

The Greens do not support the intent of this bill. We know what the government is trying to do with this bill, but we do not support it. We do not believe that this measure would adequately encourage single parents into employment. It is about cost saving rather than genuinely helping people. Obviously the government is trying to force parents into Newstart earlier, which, of course, we know causes their income to drop. This is the first step in the government's action against those people from the grandfathered group under Welfare to Work. We know that another bill will be introduced, as announced in the budget measures, which, instead of moving people in the grandfathered group from welfare to work, will be aimed at moving people from welfare to work when their child turns 12 rather than when the child turns 16, as is the case now. We have concerns about that and we know that that will result in a loss of $56 per week in income for these people as they move from parenting payment single to Newstart. We have some strong concerns about that.

We know that sole parent families on income support are already among the poorest in the country. A recent OECD report estimates that two-thirds of children whose parents are on the maximum rate of sole parent payments are poor. We believe this budget measure will do nothing more than potentially deepen the impoverishment of this group without any impact on their job prospects. We do not believe that these measures will provide families with a greater degree of financial security, as is claimed by the government; in fact, the only effect will be to make their future less certain. We believe these measures are symptomatic of the continuation of the government's punitive approach to welfare, which is what I was talking about earlier. On the one hand the government are talking about the need for incentives but on the other hand they cannot help but take this punitive approach. We know the punitive approach does not work.

The Greens have stated many times that we do not believe that the Welfare to Work regime, which was introduced by the previous government and continued by this government, is appropriate. We believe it is unfair and does not provide an adequate safety net or properly engage job seekers in securing adequate work. We believe that, if the government is truly committed to breaking the cycle of joblessness and welfare dependency, it must truly address the barriers to employment, not reduce income support and use coercive measures and harsh penalties to force people into the workforce. Again, we are taking a holistic approach here. Across different budget measures and other measures, we know that the government plans to introduce many more bills down the track—indeed, some have already been introduced and some are yet to be introduced—around making life harder for people with disabilities and forcing sole parents onto Newstart.

We believe that measures such as the eligibility criteria for the disability support pension, the failure to index thresholds and the failure to index supplements all have cumulative effects on families. When I asked yesterday at a committee hearing into one of these bills and at Senate estimates whether the government had done any assessment of the cumulative impacts of these measures on families and sole parents, I was told that they have not or that they cannot tell me. I asked two weeks ago and the information was not available. I asked again last night and it still was not available. Who is looking at the cumulative impacts on those people who are doing it hardest in this country?

We believe this approach helps to create a system of even greater inequity for those on income support in Australia. Of course, there is already inequity in the levels of income support that we provide people in the difference between pensions and allowances. In fact, last night we were talking about the fact that the system in Australia is so complex now. There is a 32-page booklet that tries to explain the various payments and allowances in this country. We are extremely concerned that this is a continuation of that approach.

We do not believe it is appropriate for the government to continue to pursue these draconian reform measures, particularly in the absence of evidence that they are effective. I do not believe it has been demonstrated that lower payments and increased activity requirements have resulted in better employment opportunities and outcomes. The government's own evalua­tions show that the result of successive Welfare to Work policies has not been an increase in the number of people with a partial capacity to work moving into the workforce. Fewer than one in five of those diverted to Newstart in 2006-07 obtained employment and left income support during that year. The rest, for the most part, remained on Newstart. In fact, quite a lot of detail concerning the myths associated with those on income support is contained in a recent Australian Council of Social Service report on that topic. We believe those evaluations suggest that increased activity requirements have meant that many recipients are less likely to be able to actively pursue the kinds of activities that would help them to find secure work. That is contained in the Much obliged report. Another report indicates that those individuals with the greatest barriers to employment have felt that the system has been the least helpful. These people have been so engaged in meeting their requirements they have been unable to engage in job search activities. We believe that pushing this line is not always productive. I have said many times in here that that approach, rather than Welfare to Work, rather than genuinely helping people into meaningful employment, is policy as work.

We believe we need to spend our resources on assisting people rather than on further alienating them from the system—providing real incentives instead of moving people from one payment to another. Many people on parenting payment are already in the workforce, working part time—integrating their parenting responsibilities with paid employment. Forcing them out onto Newstart or dropping their payment makes it even harder for them to carry out their parental responsibilities. We do not believe this approach is going to produce the benefits that the government believes it will. I will be talking some more about our concerns with the government's continued approach to income management.

I would like to finish on the work of the Social Inclusion Board, who have done some very good work and released some very good papers on social inclusion that talk about breaking the cycle of disadvantage and addressing issues around long-term joblessness. They talk about how we need to support people using individualised approaches instead of demonising them—that does not work; in fact, it alienates people—how we need to address people's skills and how best to engage with people. For example, many long-term-jobless families are sole-parent families with a child under the age of six. How we engage with those families is particularly important. This dual approach of providing incentives but still demonising people and taking punitive measures is not appropriate.

We will be dealing with the job compliance legislation in this place in less than an hour. That legislation is another demonising approach being taken by the government. Note that, while the government has some skill development measures, we are seeing them try to push fairly quickly through this place legislation that deals with punitive approaches first. We had the inquiry into the family assistance bill yesterday. That bill was only recently released, and the government intends to try to get it through this place by next week. The bill contains the most significant changes to, for example, disability support pension that we have seen in quite a while, but the government has not allowed time for due consideration of the bill and the measures it contains.

The same is happening with this bill seeking to enhance the previous govern­ment's Welfare to Work regime. We believe what the government really needs to do is wind back Welfare to Work, because it is a failed policy, and take a new approach to supporting people on income support, recognising that those people face very significant barriers. We need to take a much more holistic approach to addressing the structural disadvantage and the structural barriers to gaining employment. This measure is one of many that this government is taking.

We opposed Welfare to Work and we oppose this measure because it seeks to impose Welfare to Work on a group of people who were grandfathered from it in 2006. The government is seeking to bring those people out of that grandfathering, as it will be seeking to bring out another lot of people. We do not believe that is approp­riate; we do not believe it is the way to go. We do not support this measure or the other measures the government is talking about in terms of changing the circumstances for those people who were grandfathered from the punitive Welfare to Work approach of 2006.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

The government's Building Australia's Future Workforce reforms represent a long-term investment in the Australian economy through building the education, skills and employment prospects of the Australian workforce. An important part of these reforms is directed toward providing greater incentives for parents, particularly single parents, to engage in the workforce; reducing their reliance on welfare; and providing their family with a better future, underpinned by secure and rewarding employment.

The Social Security Amendment (Parenting Payment Transitional Arrange­ment) Bill 2011 represents the first stage of the income support payment reforms contained in the Building Australia's Future Workforce package. This bill is a positive step towards reducing the inequity which exists within the legislative structure of the parenting payment.

Under the current arrangements, recipients of parenting payment are treated differently based on when they first applied for parenting payment. This inequity dates back to the 2006 Welfare to Work reforms, which allowed recipients who had applied for payment prior to 1 July 2006 to stay on parenting payment for up to 10 years longer than parents who applied for payment after 1 July 2006. Persons who claimed parenting payment after July 2006 only qualified for parenting payment until their youngest child turned eight if they were single or six if they are a member of a couple. Prior to July 2006, a person could qualify for parenting payment until their youngest child turned 16.

This bill will amend the Social Security Act so that, from 1 July 2011, children coming into the care of an existing parenting payment recipient will no longer extend the duration of a recipient's preferential treat­ment. This will serve to minimise the lingering inequity within parenting payment as a result of the 2006 Welfare to Work reforms. Further changes for parents on income support will take effect from 1 January 2013 and will be included in a separate bill to be introduced later this year.

I want to comment on Senator Siewert's assertion that this bill will demonise parenting payment recipients. I do not accept that assertion in any way, shape or form. The fact is that, despite our growing economy, we are still in a situation where there are 568,000 dependent children in jobless families in this country. This represents a significant social and economic challenge, which we think we need to address. Long periods in receipt of income support are associated with high levels of social and economic disadvantage—I think this is something that Senator Siewert agreed with—often extending to children in these families and to future generations. At a time of increasing national wealth, having the fourth-highest proportion of jobless families in the developed world is simply not acceptable. We cannot afford for these families to be left behind.

We firmly believe that welfare is not the way out of disadvantage for parents and their children. Education and employment are the keys to economic and social inclusion, and we are committed to providing the right balance of support, assistance and incentives to ensure that parents are able to take advantage of the opportunities that our economy has to offer. As part of these reforms, single principal carer parents on Newstart allowance will have a more generous income test which allows them to earn nearly $400 more per fortnight before they lose eligibility for payment. These parents will be able to retain more of their income support as their employment income rises, providing them with an easier transition into the workforce and better rewarding them for their participation.

Further, the income support reforms are complemented by targeted assistance which includes additional training places for single parents, additional community based support for single parents through Communities for Children and access to career counselling through Job Services Australia providers. This additional assistance will be available from 1 July 2012 and will ensure that parents have the support they need to re-engage in work and other activities.

This bill is about fairness and that is why we have introduced it. I thank both Senators Fifield and Siewert for their contributions and I commend the bill to the Senate.

Question agreed to.

Bill read a second time.