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

When we left off this just before question time, I was expressing my deep concern that this particular bill is continuing and extending income management, making it much harder for those who are going to get caught up under the vulnerable persons mechanism. This particular piece of legislation also takes away the matched saving provision and also the voluntary income management incentive payment, saying that those payments no longer needed. I very strongly suspect that those people who are receiving the payments—because there are more people who have received the voluntary income management incentive payment—had they been consulted, would not agree with the government that the payments were no longer needed. A number of people have received those payments. As I was saying, not many people have received matched savings payments, because it is so hard to save money when you are on income support. Earlier, I did not want to stop halfway through the evidence that I was going to address on the evaluation of income management. The government should take on board the findings of this evaluation—and this applies to not only this particular issue but also the matter of the healthy welfare card, which will be debated sometime in the near future in this place.

I would like to draw the Senate's attention to the report Evaluating new income management in the Northern Territory: final evaluation report 2014. The findings in this report, while specific to the Northern Territory, can be used to look at other areas where income management is used. This evaluation report says:

Remember that this follows our expansion of income management and is not just about the original 73 communities. It estimates that 1.3 per cent of non-Indigenous people and 34 per cent of Indigenous people aged 15 years and over living in the Northern Territory during the period of this report were subject to income management. The report says:

Most people are on income management for extended periods with many, at the end of 2013, having been income managed for more than six years.

Remember when the Howard government first rolled this out and then when the Rudd government expanded it, income management was about teaching people how to manage their money. They would be put on that for a while and then they would be moved off it. I will come back to that issue again because it gets pointed out in this evaluation quite significantly. The report goes on to say:

Over 60 per cent of Indigenous people currently being income managed were on income management introduced as part of the Northern Territory Emergency Response.

When the process was rolled out, particularly when it was expanded, people could apply for exemptions from income management. The report says:

Few exemptions have been granted and most exemptions have been granted to non-Indigenous people—

surprise, surprise!—

who have an exemption rate of 36.3 per cent compared with 4.9 per cent for Indigenous people.

Indigenous people have both a low rate of application for exemptions and a high rejection rate for those who do apply. Almost all exemptions have been granted for people with dependent children and 0.6 per cent of those without children had gained an exemption.

The program elements designed to build financial capabilities have not been successful. This is from the evaluation of the Northern Territory new income management process. Despite over 29,400 people having been on compulsory measures, only 1,139 people—that is, 3.9 per cent—have completed an approved money management course. That is an old figure. We were given a new figure in Senate estimates earlier in the year. Substantial groups of people subject to income management felt that income management is unfair, embarrassing and discriminatory. The evaluation could not find any substantive evidence of the program having made significant changes relative to its key policy objectives, including changing people's behaviour. The evaluation found that, rather than building capacity and independence, for many the program has acted to make people more dependent on welfare. This is the income management program that is supposed to help people change their lives!

Chapter 9 of the evaluation said that, across a wide range of child health indicators, there is no evidence of any consistent positive change. No evidence! No evidence of any consistent positive change. When the data is taken as a whole it not only suggests that there has been very little progress in addressing many of the substantial disadvantages faced by many people in the Northern Territory. It also suggests that there is no evidence of changes in aggregate outcomes that could plausibly be linked to income management. Are you getting the message here? I am talking to both the government and the opposition here. Both the government and the opposition have facilitated and put in place income management. Where is your evidence base for saying this works?

The conclusion chapter, chapter 15, explains that the aims of income management are to improve the wellbeing of people receiving income support payments and to improve outcomes for themselves, their families, the communities they live in and the Northern Territory as a whole. Whether it achieves these aims is the basis upon which it should primarily be assessed. A wide range of measures related to consumption, financial capability, financial harassment, alcohol and related behaviours, child health, child neglect, development outcomes and school attendance have been considered as part of this evaluation. Some of these are at the individual level and others are more widely across the population. Despite the magnitude of the program, the evaluation does not find any consistent evidence of income management having a successful systematic positive impact. It goes on to talk about how many people have been in the program.

At the household level across a wide range of measures there has been no aggregate improvement in financial wellbeing, although some groups report an improvement in the level of financial harassment they experience. They also report more frequently having to ask others for money and that there has been no reported reduction in harassment at the community level. Again, the evaluation report that the government paid for and which was done by the Social Policy Research Centre at the University of New South Wales has found that income management has not produced the results. Not long after this report came out, I heard one of the members of the government say: 'That's because we weren't income managing enough. It's because we were only income managing 50 per cent.' Please read the report!

The report also looked at the vulnerable income management provisions targeting vulnerable income management in the Northern Territory. It identified a group of 150 highly vulnerable individuals at the time of the evaluation. In this group, some positive outcomes from income management had been reported. It says:

… the evidence we have collected suggests, that while income management is one of the tools that can assist in harm minimisation for this groups, they also need other supports.

This is the critical bit here:

Furthermore, it is unlikely that income management can effectively build the capabilities of this group, but rather they will need this intervention on an ongoing basis.

They need a whole lot of services for this vulnerable group. Again, for this group, I would argue that you need those wraparound services and you need to be providing and building the other services needed by this group of people. It says that it is unlikely to effectively build the capabilities.

As Senator Moore pointed out, when the Labor Party brought in these measures they were particularly keen to ensure that the support given to people and the assessment of the use of this was done on a case-by-case basis. We spent a long time in estimates and in the committee process detailing how that would work and making sure that people were not arbitrarily put on this particular measure in order to put them on income management, and we were assured that that would happen. The explanatory memorandum for this particular bill now says:

Exemptions from being a vulnerable welfare payment recipient are streamlined to refer solely to a person's rate of welfare payment, rather than also to require subjective assessment of a person's circumstances.

So we are moving completely away from a case-by-case basis, and we are not looking at people's personal circumstances. Then, to make matters worse, the government say, 'This is simply administration.' So a person's case-by-case assessment, a person's personal circumstances, are disregarded in order to simplify administration. This measure will be used to put classes of people who the government considers vulnerable onto income management. As I said in my opening remarks, this is about putting more people on income management, by changing the vulnerable income management measure.

As you can tell, I am very concerned about this bill. I am very concerned about these measures, about income management, about the flawed approach that is being taken to help people and about the fact that this is now going to be extended into the so-called healthy welfare card process with no evidence base. This is the final report. There were reports in the lead-up to this that showed similar sorts of results—that income management was not addressing people's circumstances, and that it was not improving the circumstances of the people that it was targeted at.

This bill also addresses some aged care issues, and I will briefly touch on those. I have contacted some stakeholders in relation to the reduction of the grant payment at the beginning of when people are going into aged care. I have heard that people are concerned and providers in particular are concerned, particularly because this is yet another stress on their budget line items. They have budgeted for a number of days of service and staff provision. The sector are saying that they have real concerns about not being granted seven days for a recipient entering care. Those seven days give providers, residents and their families time to organise the significant move into residential aged care. We heard in the inquiry into the aged care reforms Living Longer Living Better that there is often a little bit of time before people can take up their particular place when they are moving into residential aged care, and it is a huge change for people.

Without the ability to fund this time—either through continuation of the subsidy or through the ability to recoup costs from the recipient—there will be unnecessary pressure on people to push their entry into care. It will also have a compounding effect on the provider's bottom line. They are very concerned about it. The concerns are that it prejudices the resident's ability to access entry to a facility if the resident is not ready to move into the facility immediately when called. Most residents and families need at least four days to a week—sometimes more—to organise their affairs and get ready for this very major step. Providers do not reduce staffing or costs when they are waiting for a new resident and when there is a room or a bed potentially empty. So, when new residents are entering the facility, those staffing and other costs are still there. They are very deeply concerned about the impact of this legislation. Indeed, they think it may in fact lead to giving priority to those residents who are ready to move in promptly, because of the added costs when residents do not. It will make it difficult for residents and families who may need more time to settle affairs and to take this step. We do have concerns about that particular provision.

As I said earlier, we are not so concerned about the other measure—the Aged Care Planning Advisory Committees. I understand that those committees have not met for some time. Because there is so much wrong with this bill, we will be opposing it. We are opposing the income management provisions, and we are opposing the aged care schedule.

Jo Lindgren (Queensland, Liberal Party) Share this | Link to this | Hansard source

I rise today to speak to the government's Social Services Legislation Amendment (No. 2) Bill 2015. This bill continues our good work in improving our social services system so that those who most need support can get support. Given how Labor has left the nation's finances, this government has had to take the responsible steps to get the budget back into order. This bill is just part of that process, but it is also an important step in ensuring that we take the right steps to protect the most vulnerable people through the income management regime.

This bill contains three schedules.    Schedule 1 proposes changes to the Social Security Act and the Social Security (Administration) Act to continue income management and the BasicsCard for two additional years to maintain support for existing income management participants and to streamline the income management program. Schedule 2 proposes changes to the Aged Care Act to cease payment from 1 July 2015 of the residential care subsidy to residential aged-care providers for holding a place for up to seven days prior to a care recipient entering care. The schedule also proposes consequential amendments to fee and leave provisions. Schedule 3 proposes to remove provisions from the Aged Care Act that allow for the establishment of aged-care planning advisory committees. Each of these measures is important to maintain the strength and sustainability of our social services system.

I note that the Community Affairs Legislation Committee also held an inquiry into this bill. While no public hearing took place, there were a number of submissions raising concerns about the income management regime. This reflects ongoing philosophical objections by certain groups to income management measures. However, we need to note up-front that income management programs have been in place since 2007 and have assisted around 25,000 Australians. Income management programs continued from 2007 throughout the Rudd-Gillard-Rudd governments. This is a program that is responding to some of the most serious instances of social and economic disadvantage. It is an acknowledgement that sometimes people need significant help to get on their feet and we have a responsibility to provide that help. It is a program that is necessary and it should continue. This bill enables it to continue and, in fact, improves the scheme so that it is more efficient and better able to help people in need.

Schedule 1, regarding income management, was the most contentious of the issues brought before the committee and no doubt will take up most of this debate. So it is worth spending some time on this issue and clarifying exactly what this bill will do. We know all too well how, in some of these most vulnerable families, the basics of food and shelter are not being provided to children, so it is vital this program remains in place to give vulnerable families a chance to get the basics right. To ensure vulnerable people benefitting from income management continue to receive support, Minister Morrison announced that the government has committed $146.7 million to extend a streamlined version of income management to all existing locations until 30 June 2017. This will align end dates across all 12 locations across Australia. The alignment extends to the income management element of Cape York welfare reform, which will also continue until 30 June 2017. This will enable income management to continue to provide additional support in disadvantaged locations for vulnerable people, children and families.

The government is uniquely positioned through the provision of welfare and family payments to use income management to support vulnerable families by assisting them to stabilise and take control of their financial circumstances. This new funding also includes a limited expansion to new locations which might need the additional support that income management provides. This is particularly in response to the tragic case of Chloe Valentine, who tragically died as a result of neglect by her parents and was let down by the system set up to care for at-risk children, and one of the ways she was let down was by the fact that her parents saw her as an easy way to get more welfare money that they could spend on drugs. That is how serious this issue can be, and it is these sorts of scenarios that income management is meant to address. In this context, Minister Morrison announced on 14 August this year that the child protection and voluntary measures of income management will be introduced in the Greater Adelaide region from October this year.

This bill will streamline the program while ensuring continued support to people who benefit from income management. Streamlining includes the removal of social worker assessed referrals through the vulnerable welfare recipient measure, as this was an underutilised tool by social workers and highly resource intensive. The removal of this will also allow social workers to better service their vulnerable clients. There was some contention about this particular part of schedule 1 in the committee process, with concerns raised about how this process would work. However, it was made clear that this measure does not change a person's ability to access a social worker or social workers being able to make assessments. This particular mode of assessment was not really used as it was intended, so it is appropriate that it is removed. There remain a number of measures of vulnerability that will be applied before a person is put on income management, and I am confident these will be sufficient. Further changes in schedule 1 will allow participants to continue to adjust how they use their funds to meet priority needs at any time; however, they will no longer be required to discuss these arrangements with Centrelink every eight weeks.

I also note this schedule includes the phased removal of the matched savings payment, which offers people on the compulsory measures up to $500 in matched savings if they complete an approved money management course and have demonstrated an appropriate savings pattern over a 13-week period. This will cease from 31 December 2015 as these payments were largely undersubscribed and costly to administer. Similarly, there will be a phased removal of voluntary incentive payments, which offer individuals a payment of $250 for every continuous period of 26 weeks. These payments will cease on 28 December 2015, which is the day 26 weeks after 30 June 2015, as evaluations have shown that incentive payments are not the main driver for people commencing income management and that they can create a dependency on the program.

Finally, the BasicsCard Merchant Approval Framework will undergo administrative and policy changes that will simplify the model, improve customer experience and remove unnecessary customer contact. This new, streamlined improvement to the income management regime will achieve a saving of $36 million over two years.

It is worth also taking the time to briefly touch on the other two schedules of this bill. Firstly, there are amendments in relation to ceasing the residential care subsidy for pre-entry leave. These amendments formalise the ceasing of payment of residential care subsidy to residential aged-care providers for holding a place open for a care recipient. These changes better target aged-care expenditure by only paying care subsidies on behalf of people who have actually entered permanent residential care.

The savings associated with this measure as stated in the explanatory memorandum have largely been realised through amendments to the Aged Care (Subsidy, Fees and Payments) Determination 2014 and the Aged Care (Transitional Provisions) (Subsidy and Other Measures) Determination 2014. The amendments in the bill formalise these changes in the principal act.

Previously, subsidies for the pre-entry period were paid to providers for up to seven days at the rate of 30 per cent of the full residential care subsidy that will be payable once the care recipient enters care. Care recipients will still be able to take pre-entry leave prior to entering an aged-care service. The provider will not be able to recoup any lost residential care subsidy from the care recipient. However, the aged-care provider will still be able to charge the care recipient the standard resident contribution for the pre-entry period.

Previously, any days taken as pre-entry leave were counted as part of the care recipient's entitlement to 52 days of social leave from the aged-care service. Under these amendments, the 52-day cap on social leave will not include any leave that was taken as pre-entry leave. This ensures any pre-entry leave taken by a care recipient does not negatively impact on their ability to take other forms of leave from the residential care service.

The impact of lost pre-entry leave payment revenue should be considered in the context of other recent aged-care changes, such as the redirection of the former government's workforce supplement into the general pool of aged-care funding and the introduction of a higher level of accommodation supplement. The government is expected to provide $11 billion for residential care subsidies in 2015-16.

Finally, schedule 3 relates to the aged-care planning advisory committees. On 15 December 2014, as part of the 2014-15 Mid-Year Economic and Fiscal Outlook, the government announced that the Aged Care Planning Advisory Committees would be abolished, with ongoing functions to be performed by the Department of Social Services. This forms part of the Smaller Government reforms to reduce the size and complexity of government, streamline services and reduce the cost of government administration. The Aged Care Planning Advisory Committees' role was to provide advice in relation to the distribution of aged-care places. However, the last of these committees expired in September 2014. These amendments repeal the now-redundant relevant provisions in the Aged Care Act 1997.

The government remains committed to engaging with stakeholders and obtaining local intelligence as part of a needs-based planning framework. Consequently, the department has consulted with a broad range of aged-care stakeholders to help inform the distribution of aged-care places in relation to the 2015 Aged Care Approvals Round which was announced on 15 August 2015.

The income management regime has been an integral part of our social services system now for eight years, and it has been supported by governments of both major parties. It is important that we continue to modify the regime and adjust as circumstances change so that it can continue to support vulnerable families.

These changes need to be looked at in the context of the need for cutting red tape and for budget repair. We need to make sure our social services system targets those most in need and provides adequate support for those who need it.

This bill is an important step in ensuring the sustainability of our social services system while also ensuring it continues to be most effective where it is most needed. I understand that there is, both here in the debate in this place and in the work of the community affairs committee, some contention about these income management measures. It is clear to me, though, that the proposed changes, together with the government's additional investment in financial wellbeing, will deliver more streamlined and cost-effective management programs. Furthermore, this bill provides ample flexibility for the minister so that vulnerable persons criteria remain responsive to the needs of the day.

It is important that we get this issue right. Vulnerable Australians need the income management program to help them get back on their feet. We need to make this program as simple and efficient as possible. This bill does that, and I commend it to the Senate.

Helen Polley (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Aged Care) Share this | Link to this | Hansard source

I rise to speak on the Social Services Legislation Amendment (No. 2) Bill 2015, and I do so following on from the contribution that Senator Claire Moore made earlier in the day where she outlined the Labor Party's position in relation to the general outline of this legislation. But I want to focus my comments on the bill's two amendments to aged care. They appear to be innocuous enough—but only if taken in isolation.

The first measure ceases payment of the pre-entry leave subsidy. Unfortunately, the contribution by the government senator before me clearly does not have an understanding of what this is really going to mean, not only to the aged-care sector but also to the families of those who are considering moving into aged-care homes. The message from the government is quite clear. I think they have demonstrated that every day of the two years that they have been in office, and that is that you are on your own, particularly if you are some of the most vulnerable members of our community. Certainly that has been most apparent in this area of policy when it comes to older Australians and aged care in particular. Pressure is going to be placed on the sector to cover that period of time when they cannot recoup that income when they need to make sure the room and facilities are up to scratch and the time when families need to consider all the issues that they have to consider when trying to decide on making what is, for most people, a fairly significant move in the latter part of their lives. So, to me, this is yet again another attack on the budget bottom line of the aged-care sector.

We know this government is very fond of cutting and not really doing anything when it comes to consultation with this sector in particular. But what is more galling is that the Prime Minister, prior to the last election, said that he would bring in a government of no surprises and no excuses. Yet every other day and every other week in the past two very long years that is what we have got—backflips, changes and cuts without any consultation at all. Unfortunately, the aged-care sector has been one sector that has suffered greatly.

The bill also abolishes the Aged Care Planning Advisory Committee as part of the government's small government reforms. This seemed harmless enough at first as well, but now it is clear that this smaller government reform can only be achieved by increasing the burden on the sector, pickpocketing from the aged-care sector. So, once again, it is going to have a real impact on the aged-care sector. One might even say that the government has increased red tape for the sector, something that the sector is not very happy about.

This government is quick on its feet when it comes to cutting funding but differs quite dramatically when it comes to implementing any real reforms. A case in point is the slow and dithering implementation of Labor's Living Longer Living Better reforms to aged care, which were introduced with bipartisan support and extensive consultation over the period of the last Labor government. The reforms were not short-sighted. They were not politically motivated. They were about setting a framework for the next decade to ensure that older Australians and their families and the sector knew the direction they were going to be taking. We know how important it is for the community to understand the challenges around ensuring that we have the world's best aged-care homes and facilities and support to keep people in their own homes as long as we can.

Mr Abbott promised to continue rolling out these reforms before coming into government, and the aged-care sector was quite relieved about that. It was quite relieved because there have been so many changes and a lot of upheavals. There was extensive consultation by Minister Butler and the Labor government, and the sector was assured by the opposition under Mr Abbott at that time that those reforms would be rolled out. But after two years in government Mr Abbott still has no plan to deal with Australia's ageing population. Labor's Living Longer Living Better reforms have been undermined by a consistent lack of oversight and interest. They have been undermined by the assistant minister, who has never had his eye on the ball. I have spoken on many occasions in this chamber about the fact that the assistant minister so blatantly demonstrates his lack of care and compassion for and interest in this very important sector. As a result, a great deal of avoidable anxiety and stress has been caused in the sector.

This is not something that only we on this side of the chamber are aware of. It is what the sector is talking to us about regularly. It is in constant contact. People in the community are concerned about the direction that this government is taking in a whole range of areas, but, I can assure you, aged care is firmly on their agenda. They have a great deal of concern about the lack of direction. In fact, the performance and administration of the aged-care portfolio under this government has been, at the very least, very disappointing.

In fact, this government have demonstrated that they are bereft of any leadership when it comes to the issues to do with ageing in this country. They are bereft of any vision for this country when it comes to looking after older Australians. It has been clearly demonstrated that they cannot even implement a framework that was put in place by the previous Labor government. They are very quick to come in here and espouse that they inherited debt and deficit. We all know what they have done on that. They have just increased it. Growth and everything else is slowing down. But that they are not even being able to implement a good policy that was supported not only by the sector itself but by the community leaves me speechless as to the lack of compassion that has been demonstrated by this government.

Since September 2013 there is only one thing that this government have demonstrated, and that is that they are only interested in cutting. They have made cuts to the aged-care sector—we know that. We on this side understand, as does the Australian community, that this government have no idea what they are doing when it comes to aged care. The government have an integral role to play in ensuring that we can meet the needs of older Australians now and into the future. I am truly concerned that this government's dithering, delays and disarray are creating even further anxiety and concern for aged-care workers, aged-care providers and older Australians and their families, who will be the ones who will feel the brunt of this government's lack of leadership and vision.

Mr Abbott and his Liberals—and it is not just Mr Abbott; it is Mr Morrison, who is the minister who has the overarching responsibility when it comes to aged care, and the assistant minister—have set a very poor record for aged care in this country. The sector has received numerous kicks in the gut—no consultation, no warnings, just hit after hit. They have a record of fuelling anxiety and uncertainty in the sector and the wider community which is entirely avoidable.

Senator Fifield has overseen a number of chaotic, reactive and often ideologically driven decisions, including, firstly, axing with no consultation or warning the $17-a-day dementia and severe behaviour supplement paid to residential aged-care providers. He came into this chamber on 26 June and just announced the cut. That is the level of competency of this government.

Secondly, he announced the flying squads. We will have a lot of fun with the flying squads at Senate estimates. We will have a flying squad that will zoom in and come up with a model for individual care. The whole problem with the flying squad is that, when they put the tenders out, they asked the people tendering for this contract to come up with a solution on how the flying squads are going to work. We do not know whether there will be a flying squad in New South Wales and one in Victoria. Will there be one in Tasmania? Will there be one in Western Australia? How many flying squads will there be? How much money will be used to administer these flying squads? Honestly, it beggars belief. You put out for tender this idea of flying squads without any consultation and without a pilot project to see whether they will work—

Barry O'Sullivan (Queensland, National Party) Share this | Link to this | Hansard source

That's the normal thing. You are showing your ignorance.

Helen Polley (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Aged Care) Share this | Link to this | Hansard source

Honestly, it demonstrates a bereft vision in this sector.

This government also promised to develop an Aged Care Workforce strategy, which the sector, the workers and the community are still waiting to see. Once again, it is null and void—no action. This is Dementia Awareness Month—a very serious topic and one that we need to talk to the community about so they understand that people live with dementia. It is an issue that we need to give more airplay to. At the forum held by the Parliamentary Friends of Dementia today, a gentleman talked about how he is living with dementia. One of the very good things that he said today was that his diagnosis was caught early. That is fantastic; it means that the message is starting to get through to the community. They also talked about early onset dementia. We know it was this government that cut $20 million from the Dementia and Aged Care Services fund for innovative aged care services, including dementia care and risk reduction. It has also abandoned the Younger Onset Dementia Key Worker program.

It is time for the Abbott government to take some leadership, to show some compassion and to take aged care seriously. We know that Mr Abbott does not give this issue the same profile as we did when we were in government—we actually had a cabinet minister responsible for ageing in this country. That is the weight the Labor Party puts to a policy that is so essential and that affects every older Australian. We cannot overestimate the value of having a minister in the cabinet to voice their concerns and to have a strong voice at the table when they are setting out the budget. Quite clearly, this minister and the assistant minister are not up to their jobs. That is really disappointing because so much has already gone into building this framework. I do not know why I am surprised that they have failed the Australian people on aged care—they have broken all their other promises—but all the hard work had been done. The consultation had been done; the sector was there willing and able to implement the Living Longer Living Better strategy. It had been agreed; it had cross-party support. But the government has failed in administering and rolling out these changes. It has all become too hard for the government and so it has slowed things down. We have also seen further cuts—$20 million has been cut from the Dementia and Aged Care Services fund.

You put money into research, and that is admirable. I salute you for investing in dementia research. Of course, we have to do research—we have to find a way of preventing dementia in the first place. Those people currently living with dementia deserve respect and they deserve a government that will prioritise the investment into their care so they can continue to live in their communities. We should be doing more to ensure that we have dementia friendly communities. We should take a leaf out of the book of Scotland or the UK or Japan: they are establishing friendly communities and dementia friendly programs to ensure there is a good profile for dementia in the community. Dementia does destroy people's lives; early onset dementia in particular can be very difficult for families. It is critical that we do everything we can to ensure that people living with dementia and their families have the support in the community that they need.

It is fair to say that the Australian government under Tony Abbott has failed the Australian community when it comes to aged care. It has failed the fairness test in so many areas that I could mention. We talk about health cuts and education cuts, but, when it cuts money for those people with the severe behavioural issues associated with dementia, that is fundamentally unAustralian. It really is unAustralian to keep attacking the most vulnerable in this country. They should be able to expect more from their government, and it should not matter what colour that government is—whether it is a conservative government, and this is a very conservative government, or whether it is a Labor government. It is really the responsibility of government to deliver the respect and the care to those most in need.

Senator McKenzie interjecting—

The interjections from the doormats down the other end who are leaving rural and regional communities trailing behind when it comes to dementia. They are supposed to be the party that speaks up for rural and regional Australia, but on so many issues they fail that test. What we did for older Australians when we were in government and the plans we put forward, Senator Ronaldson, you will never ever be able to match because your government fails the test when it comes to leadership and your government has failed the test of fairness every single day for two very long years. I remember giving speeches about the eleven long years of the Howard government. I can tell those people who are going to read this or who are listening, this government's past two years of government have been two of the worst years in this country's history. That is how it will be recorded because this government has attacked the most vulnerable in this community in a whole range of areas—if you look at pensioners, if you look at health and if you look at education where they are trying to stop young Australians going to university unless their parents have a big credit card. That is not the sort government that this country deserves; that is the government that the Australian community has lost faith in. The Australian community has lost trust in Tony Abbott and his government. It is not just us on this side of the chamber saying this, it is a reflection of what all the polling is saying. But, more importantly, it is what people say to us one-on-one in every corner of the community that we go to—whether it is when I am visiting disability services, whether it is when I am visiting aged care homes or whether it is when I am visiting people through home care support, whether it is when I am going to a school or whether it is when I am down doing my grocery shopping. I hear the same thing every single time people talk to me. They say: 'Bring on the election. We have to get rid of this Abbott government because it is bad.' It is not just Tony Abbott—it is Morrison, it is Bishop and it is every one of them because ideologically they are all tainted with the same brush.

Bridget McKenzie (Victoria, National Party) Share this | Link to this | Hansard source

Mr Acting Deputy President, on a point of order: Senator Polley was referring to ministers in the other place by using their surnames and in a way that I was not actually able to recognise which minister she was talking about. I ask that you seek that Senator Polley refer to people in the other place by their appropriate titles.

Gavin Marshall (Victoria, Deputy-President) Share this | Link to this | Hansard source

I do remind senators that they should refer to members by their proper titles.

Helen Polley (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Aged Care) Share this | Link to this | Hansard source

Thanks you, Mr Acting Deputy President. I always know that I have hit a nerve when Senator McKenzie has to interject or pull up a point of order because she does not like to hear the truth. The reality is that obviously you do not go out into the community and listen to people. You might go out into the community and talk to them, because that is probably what you do best, but you should try listening to the community. Quite frankly, this government needs to listen to the community because the community are not happy. Those on the other side who have on occasions actually demonstrated some compassion need to be stronger voices in their caucus to ensure that this government looks after older Australians and that it looks after those most vulnerable in our community, because the Australian people deserve nothing less. This government has been a failure for the last two years and there is no sign of it improving in the near future.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

I support the Social Services Legislation Amendment (No. 2) Bill 2015, and I think that the best way to characterise the bill is by saying that it is not about paternalism but it is about prudence, and it is about providing a framework of support in a way that has been quite carefully considered. Of course the bill, in terms of its more widespread implementation, ought to be subject to review—to see if it is working and to see whether it needs to be tweaked.

I know this does not happen very often in this place, or particularly in the other place, but I would like to pay tribute to the work of the Parliamentary Secretary to the Prime Minister, the Hon. Alan Tudge, who has been persistent, who has been methodical and who has been very decent in the way he has gone about this. I think he has consulted broadly and widely, and he deserves credit for his very hard work. He has been genuinely trying to seek a good outcome and he has approached the issue in a cautious and a considered way. He deserves credit for the way that he has gone about things. In my dealings with him, it was a case of genuinely being involved in consultations, of walking through the steps and asking for feedback—I think that is refreshing and it should be acknowledged in the context of the adversarial nature of this place.

By extending income management for a further two years and streamlining the system, the government is providing a framework of support. It makes it harder for funds to be used for activities that are quite frankly destructive—whether we are talking about substance abuse, be it alcohol or illicit substances, or whether we are talking about gambling and in particular poker machines and the impact that can have on the communities. This approach does provide a framework of some protection. It is not paternalism, it is something that is worth doing and worth doing well.

This bill, contrary to public perception, is not about a particular class of individuals—it is not just about Indigenous communities, either. It is about a range of communities in which people face huge social challenges. The bill removes incentive payments and measures that have not worked in increasing the take-up rates of voluntary income management schemes. The bill extends the income management system that has been in place for a number of years under both coalition and Labor governments. The fact is that income management works for many people. It sets up dedicated accounts into which 50 per cent of their social security income can be paid for specific purposes, including rent and food. For parents involved in a child protection measure, compulsory income management quarantines 70 per cent of income. These percentages are not excessive in my view—any parent knows the true cost of raising children and these percentages merely reflect those costs.

One fact that I found telling was that the history of income management shows that two-thirds of people who came off the compulsory system chose to stay on it. This suggests that most people who experience income management actually benefit from the structured support it provides. Opinions from Indigenous leaders are not unanimous, but I note that Cape York leader Noel Pearson has said that income management is a 'crucial first step' for many Indigenous people. Mr Pearson told the ABC last month:

I am personally in favour. I am concerned about vulnerable people.

I am pleased to see that some consensus has been reached in relation to certain provisions of this bill, including amendments moved by the opposition, namely that social workers should retain the ability to place vulnerable people on income management

Placing someone on income management is a serious decision. It must be done after careful consideration of an individual's personal circumstances, and that goes beyond the class of individuals or those areas that have been designated for the trial of income management.

Every day, social workers deal with people who are suffering from addictions, mental health issues, abuse and poverty; every day, social workers see the effects of these problems; and, every day, social workers see potential solutions. Social workers are in the forefront in dealing with society's most vulnerable and at-risk people. They understand the causes of vulnerability and the methods which can be applied to address it. That is why the Labor Party's amendment is welcome in this regard.

Social workers can see when a person might be spending their pension on alcohol rather than on paying the rent. They know when their clients are losing money on the pokies, money that should have been spent buying groceries instead. Social workers can objectively consider a client's personal situation, including that client's ability to handle their money in a responsible way, particularly vulnerable people. Income management can assist people who are vulnerable. When a person is caught up in an addiction, it can be nearly impossible for them to look at their finances in a similarly objective way.

While the choice to buy food before spending money on gambling may be obvious to most, for those who are in the grip of a gambling addiction the choice is not so simple. They are driven by a compulsion that cannot be fought with reason. They need help to find ways to beat their addiction and to ensure they can afford life's essentials while they are addressing their addiction. In these situations, income management helps keep food on the table and the electricity on at home.

When it comes to some of these issues, such as gambling legalised by the states, if we had in place the Productivity Commission's recommendations of $1 maximum bets per spin and $120 hourly losses—still a lot of money, but much better than the $1,200 an hour that could be lost now on machines—that would make a difference. We could actually tackle some of those causes with some sensible legislative reforms that I note, however, both the government and the opposition have rejected.

With a social worker's involvement, an individual will only be placed on income management after careful consideration and only when it is absolutely necessary to ensure their basic needs are met with the limited resources they have. Equally important is the ability of social workers to check in on their clients who are subject to income management. This monitoring will ensure that income management achieves its intended results.

I welcome this bill. I think it needs to be subjected to ongoing scrutiny in terms of the measures that will be implemented. Of course, the Senate estimates process is part of that, but there ought to be ongoing scrutiny of the measures in this bill in terms of how income management is working, how effective it is, what good it is doing and whether there are any adverse or unintended consequences.

Again, I congratulate the Hon. Alan Tudge, Parliamentary Secretary to the Prime Minister, for the work that he has done on this. I hope that his hard work—his methodical, painstaking approach to this—will pay off, with good results for communities throughout this nation.

Barry O'Sullivan (Queensland, National Party) Share this | Link to this | Hansard source

I rise to make a contribution to the debate on the Social Services Legislation Amendment (No. 2) Bill 2015. Whilst I have an interest in all aspects of this legislation and the associated amendments, one of my primary interests is the impact that this policy has had and is continuing to have on our Indigenous communities.

My home state of Queensland has a number of Indigenous communities spread all over the state, some in particularly remote parts of the state. The challenges that confront those communities, while similar, can be somewhat magnified or exacerbated by remoteness and by the challenges that generally face people in those communities on a day-to-day basis. I have spoken in this place previously of a number of recent visits that I have had to the community on Mornington Island, which is in the Gulf of Carpentaria, off the northern part of Australia. Although I move around our Indigenous communities and have done so all my life in various forms, I was taken aback by the circumstances that confront the 700-plus residents of that community of predominantly Indigenous islanders.

One telling tale, which will lead me into the core of my contribution here, took place on my second visit, the day we were departing. I had dealings there with a number of professionals and social workers who were involved in the delivery of social services and justice on the island, and I learnt that, in court that week, collectively the residents had faced charges for over 200 offences—crimes, misdemeanours and simple offences. Just think about that. The entire community population is less than 1,000, yet there were 200 charges across that community in just a seven-day period. As I left, it was telling that there was a charter aircraft of significant size there to take away any people had been given custodial sentences.

Whilst we all support the fair and reasonable application of the law, there are circumstances that present in these communities that would seem to expose people to behaviour on a scale relative to their population that we do not experience elsewhere. The removal of people who are given custodial sentences means they are moved completely out of their community. It is not simply a case of a son or a daughter, a nephew or a niece, being sent to jail for a week, a month or 12 months, where you can continue to give them that family support. These people are moved thousands of kilometres away from their community to do their time. It is really an indictment, I think, of Australian society that we still have factors of this scale in these communities.

As we delved into the reasons for that behaviour, we were to learn that they were pretty much the typical things that one might expect to see when looking at the data. Writ large, of course, was alcohol abuse—and I will come back to that briefly, in a moment. There was evidence of illicit drug-taking and the impacts of that. There was also evidence of gambling and to a much lesser extent the use and distribution of pornography. Coming back to the alcohol abuse issue: it is accepted by many who live in these communities and from the work that has been done in the social sciences that many of these people have a much lower tolerance to the consumption of alcohol. It has an effect on their behaviour a lot sooner than one might expect when looking at the capacity of an average Australian to consume alcohol without it necessarily having these behavioural impacts.

The other thing that was quite noticeable was the age bracket. It seems that the abuse of alcohol on this island, in many of our Indigenous communities as well as in the poorer socioeconomic sections of our general communities has no respect for the age of the people who are involved. There was ample evidence to show that children as young as nine or 10 had from time to time consumed alcohol and been affected by it to the point where their behaviour caused them to be involved in acts or omissions that attracted the legal proceedings that I made reference to earlier.

This is an island where the sale or possession of alcohol is prohibited. I am concentrating not just on this island but on the concentration of these problems—the problems that give rise to the need for the type of legislation that we are debating here. These problems were so much more acute, so much greater as a percentage of whole, on the island that it is useful as a case study to make the argument for the legislation that we are talking about here for these people to be able to manage their income arrangements. We found that the alcohol was being manufactured illicitly on the island and then sold of course at very inflated prices, without any regard whatsoever for whom the buyer or consumer of the alcohol may be. We also saw an increase in the manufacture of methamphetamines, particularly ice, in many of these communities. Again, these things require money and resources to be able to be established in the first instance and then they are sold at quite inflated prices to people who have an addiction. Gambling is a lesser problem on the island but it is very evident in many other communities around the state, particularly the extent to which it impacts on Indigenous populations in some of the metro communities. A point made by Senator Xenophon—and a very important point—is that oftentimes we ignore the fact that the issues in the lives of these people are as a result of their addictions. Many of these people cannot control what they do; those who can, obviously choose not to.

As I moved around this community and also around many other Indigenous communities in my time here and before, one thing that was common was the impact on what we might regard as the essentials or necessities of life. There is a serious body of evidence that these are the first things to suffer, particularly the buying of a good quota of quality food for a family and clothing. There is an impact when people do not have the capacity to deal with the costs associated with their housing or accommodation and, indeed, the general utilities of life. What we have is quite an abnormal situation in many circumstances, and the ones who clearly suffer the most are the younger generation within these communities—the children, even infant children.

Many of the responsible parents, notwithstanding their efforts, find it very difficult to manage their circumstances because oftentimes they may have not just one other person in the household who abuses alcohol and/or drugs but multiple adults who are in the business of abusing these things. In fact, there was evidence that entire households can suffer in one form or another from addiction in one or more of the areas that I have discussed. Often what you have in these communities are very powerful strengths, and one that we can learn from of course is the network that happens within families. Indeed, it is very common for the burden of child care to fall upon a relative or a community leader. They might find themselves, as they have deposed to me on my visits, with 15 or 20 children seeking refuge in their home, looking for food and other essentials and necessities of life. If these essentials were not provided by the relatives, social workers, teachers or educators in the communities then these children would quite literally be left to perish. So, where you have a situation where the adults, the people who receive the money and who are meant to provide these essentials of life—food, clothing and protection with housing and utilities—do not and there is evidence that they do not, then, as far as I am concerned, any responsible government—and we are a responsible government—has a complete duty of care to do whatever it can do to assist these families who are in such a plight to manage their lives.

It is well known that in many of these communities we have serious financial illiteracy. There is evidence that people can dispose of the entire household income within the course of one day without having any regard whatsoever for what happens on the other six days of the week until they are returned to a position of having the potential capacity to deal with these essentials of life. In those circumstances it is not just a case of children going about with hungry bellies or not being able to go to school because they do not have the appropriate clothing or because they do not have the capacity to get from A to B for a day or two. This can go on for an entire week, and where these problems are systemic in those households they can of course go on for weeks and months. For some families, sadly, tragically, they go on for a lifetime. These income managed funds prevent at least a large part of the income being used for these illicit purposes. They create an environment where the money can only be expended on those essentials and necessities of life that I described to the chamber earlier. The trials of this income management scheme have proven effective, in effect allowing the management of what I might refer to as forced budgeting, in the sense that that portion of your money can only be spent on these particular categories.

A very substantial number of people have reported, including some of the people who have been involved in the scheme, the social workers who are at the coalface day in day out supporting these families, the community leaders and the peer reviewed research that has occurred on behalf of the government to see that this scheme is operating. On the material available to me it would seem that a substantial number of the people have declared that this program makes their lives easier. These are people who have participated in this policy setting or are observers of the impacts of it. It allows people to manage their money, albeit still in short calendar time frames. It makes these people feel safer. That is a very important statement. It does not just fill their bellies. It does not just put food on their tables. It does not just put clothing on their backs. It makes many in these communities feel safer. I expect that that comes in part from the normality that is restored, at least in part, to some of these households and homes because they have an ability to deal with the basic management of their financial affairs in regard to the essential aspects of their lives. To a person it would seem they all reported that it improved their lives.

We talked briefly before about the fact that many of these homes and many of these families are impacted by alcoholism, which can lead to domestic violence, and indeed it makes a contribution in a more general sense to community violence. What we have is a situation where even if there is a responsible adult in a cohort in a family situation they do not always have the ability to manage the finances of that household and to make provision for the things that we have discussed here in the contributions today, even if they have the capacity to do so. Accordingly, trials and policy settings of this type are needed to bring stability back into these homes. They are needed as tools for the responsible adults to be able to manage the households and to make that journey towards normality. It reduces neglect. It reduces homelessness where people are displaced as a result of their living circumstances. We have had child protection staff now universally reporting on the need to continue to adopt this particular scheme.

I was very pleased to hear Senator Xenophon reporting to the chamber that this bill had been carefully considered. Senator Xenophon does not agree with the government all of the time, and I think that his words of wisdom should cause others to consider what has happened here. He has reported, and I am prepared to report, that the government has very carefully considered these measures. It is not as if we are into greenfield ideas here. These ideas have been working very successfully now in our communities for a long period of time. This is about extending what appears to be a very successful program, inasmuch as it impacts on the income management side of things. There are incentives involved. As you know, the legislation provides for matched savings. These are additional incentives not only for these families to manage their money. It is there to provide them with incentives to put away some money for that rainy day circumstance. It quarantines 70 per cent of the income, which ought to reflect the cost of living where they are. I think the most telling point is that over two-thirds of the people who had been put on the scheme volunteered to remain on the scheme. If this point is ignored by those in this chamber then they no longer will be able to declare that their position reflects the position of the people who have benefited from this.

We had a contribution earlier about listening. Well, you need to pin your ears forward as I say it one more time: two-thirds of the people—

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

You do not know what you are talking about, Barry.

Barry O'Sullivan (Queensland, National Party) Share this | Link to this | Hansard source

Do not tell me I do not know what I am talking about, Senator. Two thirds of the people who have been on this scheme have continued on the scheme on a voluntary basis. If you want to make your contribution in contradiction of the contributions made by people like Noel Pearson, I am afraid that I am going to have a deaf ear to you and two ears facing towards North Queensland while I listen to that community leader. He is no friend of the government on every occasion, I promise you. If Noel Pearson has something to say, he has a complete disregard for the political identity of those on the other end of his sharp tongue. If he supports it and two thirds of the people support it, then I commend to this chamber that we support it also.

Bridget McKenzie (Victoria, National Party) Share this | Link to this | Hansard source

I rise to add my contribution on the Social Services Legislation Amendment (No. 2) Bill 2015—a bill for an act to amend the law relating to social security and aged care and for related purposes. The bill is attempting to address some of the challenges that we face as a modern society. One of those is how do we deal with the reality that human beings do not always act in their own best interests or in the best interests of those they are charged to love and care for. A second challenge is how do we deal with the challenges of funding the needs of an ageing population. I must agree with Minister Fifield, the minister responsible for ageing, when he sees that challenge as a positive one. Never before have we had to consider how to support and engage with a cohort of ageing Australians who are relatively highly educated—and if you are a Gen Xer, you might argue, entitled, but they are definitely an empowered cohort of Australians heading into retirement—who are cashed up, who are very successful and who are very cognisant of exercising their rights as individuals around the choice of how they age and where they age.

These are significant challenges for modern Australia. They are significant challenges for governments that want to assist communities achieve a better life. We as a government do not shy away from our responsibility to do that. We do not shy away from the challenges that are presented to us in the 21st century and we do not shy away from the challenge of prioritising them. Contrary to suggestions in some of the contributions made by senators on the other side, we do prioritise. We have to. That is what governments have to do. We do pilot programs, we evaluate them and we then fund programs appropriately. We will continue to do that.

One of the first measures that this bill deals with is to ensure that the vulnerable people currently benefiting from income management receive continued assistance. The government has committed $146.7 million to extend a streamlined version of income management to all existing locations until 30 June 2017. This will align end dates across all 12 locations across Australia.

When we look at building on the positive impacts of income management, we see that this particular policy response gives participants more control of their welfare money. We have heard senators talk about how it improves families' stability as parents, primarily caregivers, can ensure that children and those vulnerable within the family have the basics that they need to get a good education, to be well fed and to be well housed. I cannot believe there are senators here in this place who would reject the evaluation that has been done of the pilots and would reject the evidence which says that two thirds of income management participants want to stay on it because they see the benefits. Their families experience the benefits. Their children experience the benefits of the system. It reduces stress and financial hardship.

Just think for a moment about what it would be like to be in one of those very vulnerable families where one of the parents or caregivers is subject to addiction and you have to argue with that family member in order to get the bare minimum of cash that you need to ensure that your children are cared for. That is not always a pretty conversation, it is not always a neat conversation, it is not an articulate conversation between rational adults about where best to spend the income that that family has. It can involve violence and it can involve incredibly destructive displays of behaviour, particularly for the young people in those families. I would struggle to understand why, when over two thirds of participants have indicated that they would prefer to see their income managed, people in this place think they know better for that group of people. It is the height of entitlement and elitism to think that you know better than the people who are experiencing these issues at the coalface day in, day out. It is their kids, not yours. It is just the height of entitlement.

Key changes to the income management program will include reducing the amount of compulsory contact between income management clients and Centrelink, while retaining participants' ongoing access to customer service officers and, particularly important in families and cohorts like this, specialists such as social workers. The changes will include removing the compulsory requirement for all income management participants to be referred to financial wellbeing and capability services and phasing out the underutilised parts of the services such as the voluntary incentive payment and the matched savings payment.

The existing locations that I mentioned earlier include Western Australia, the Northern Territory, South Australia, Queensland and New South Wales. The whole of the Northern Territory is currently using the income management system. In Western Australia we have the Peel region in Perth metropolitan, the Kimberley region, the NG Lands and Laverton Shire

In Queensland, we have got Logan, Rockhampton, Livingston and Cape York—remembering, for the Cape York welfare reform, Noel Pearson was a key driver of that particular initiative. We have Bankstown in New South Wales. In South Australia, we have the Playford, APY Lands and Ceduna regions. We have Greater Shepparton in my own home state of Victoria, where we have seen significant issues. We have high teen pregnancy rates in these cohorts. We have significant intergenerational disadvantage. It is mechanisms like this that will actually assist these families to get their basic needs met so that those children within those families can actually have the best opportunity to excel at school and to actually, hopefully, overturn that generational cycle.

Within these regions, a person can go onto income management only if they are volunteered to participate, if they receive particular welfare payments or if they have been referred for income management by a social worker. That typically involves assessments around the neglect of children. The BasicsCard can be used to buy most goods and services, except for alcohol, gambling products, cigarettes and pornography. All of those four goods and services are absolutely subject to being quite addictive for certain people and individuals. I myself was addicted to cigarettes for over 20 years. I do know the pull that that can have and how your priorities around how and what you choose to spend your time doing and your money on can be quite skewed, particularly around those four issues. Also, one of the key aspects of the income management system is that cash withdrawals from an ATM are not available using the BasicsCard. It operates like a normal EFTPOS card but is accepted only at approved stores. There are more than 13,000 BasicsCard merchants right across Australia, ranging from large supermarkets and department stores to small, independently run shops.

I think, as Senator Xenophon made clear in his remarks, most income management participants choose to stay on the card because it allows them to be able to provide for their families. I think that is something that we need to remember in this place. It is all very nice to have our theoretical models all ready and our ideological stamp cards at the door, all ready to get our gold star from the elites in inner urban centres. But when you have the evidence before you that two-thirds of people want to stay on this because their kids are getting fed and clothed, they do not have to go through a fight, they do not have to hide anything and they do not have to try to get to the bank before he does on payday or on welfare payment day. They can actually be assured that those basics will be met. I think it is groundbreaking.

I just wanted to briefly mention Minister Morrison's statement on 14 August, mentioning how the coalition governments will roll out the BasicsCard for Adelaide welfare recipients who volunteered to participate in income management or are subject to child protection measures. The announcement demonstrates strong, united actions on the recommendations of the state coroner's inquest into the death of Chloe Valentine, which recognised that income management could benefit many children at risk of neglect and abuse. I would like to thank Senator Xenophon for his support. I would like to request of the crossbench senators that they think about the state coroner's report, they think about Chloe Valentine and they think about the recommendations out of that report that income management, when applied appropriately, can actually make a difference to families' lives. Yes, they get to school. Yes, they are fed and clothed. But in instances of neglect and abuse, this is a space where government needs to be and government needs to assist the most vulnerable, who are the children in our communities.

I would like to also commend the South Australian government, who requested that these measures be introduced in Adelaide because they did not want to see another tragedy like this. It is this federal government, and I am sure every South Australian coalition senator in this place, that wants to see this measure rolled out so that those families and those vulnerable children can be protected. The Australian government is also providing $12 million over five years to deliver early intervention and referral services in South Australia, which is also helping to keep children safe. That is incredibly important and, I am sure, one of the main reasons that so many of us are in this place.

In terms of income management, I have mentioned that evaluations have been taking place. I know senators opposite are quite quick to claim that, as a government, we choose not to consult and we do not run pilots. I would happily run our record of evaluation, application and implementation against the previous six years of the Labor government any day of the week. The fact that we actually bother to evaluate programs, make assessments and recommendations and then implement them is a far cry from the policy approach that we were subjected to under the previous Rudd-Gillard-Rudd governments.

The legislation also sees the phased removal of the matched savings payment, which offers people on the compulsory measures up to $500 in matched savings if they complete an approved money management course and have demonstrated an appropriate savings pattern over a 13-week period. That is going to cease on 31 December, as they were largely under prescribed and costly to administer. This is part of what governments do when they have to prioritise: if it is not being used and is costly to do, our taxpayer dollars are much better spent elsewhere—particularly in this portfolio, particularly in this area and particularly with this cohort of very vulnerable Australians.

I just find it quite ridiculous that those who claim to be progressives are actually the ones who want to hold onto the way that things have always been more than anything else. They want to hold on, keep things same, never change anything and not be responsible. I have got so much more to say. I will continue after the break.

Sitting suspended from 18:30 to 19:30

I rise to continue my contribution to the debate on the Social Services Legislation Amendment (No. 2) Bill 2015. Whilst my contribution before the break focused on the BasicsCard and the measures that the government seeks to introduce as part of that to ensure that families remain stable and that they can continue to ensure that their children receive basic needs. I also want to briefly touch on the changes that the government are seeking to make within the aged-care portfolio. As the minister for ageing has made very clear in his recent comments, it is a positive challenge for us as a nation. This is a large cohort of highly educated and empowered Australians entering retirement and entering aged care. Indeed, 70 is the new 50! They are travelling like never before, they are spending their children's inheritance like never before and they want choice in how they age like never before.

Part of adapting as a government and responding to the challenges of modern society in the 21st century is recognising that the old ways do not work. We need new and innovative ways to address the challenges that face us as a society, and ageing is one of those. As a government, our focus for this cohort is ensuring that they have more choice in their care and that those individuals that can afford to make a greater contribution to their retirement do so. It is not an automatic entitlement anymore that the state will look after you in your old age. If you look at the retirement age now compared to what it was when the first age pension was instigated, you would have to be close to 100 before you got the age pension, if you were going to be proportional about it. But we are not. We are a very generous society. People work hard throughout their life, and we like to recognise that going forward.

Part of the role of being a good government is being a financially sustainable government. That is something that the Abbott-led government takes very seriously. Part of the measures in schedule 3 of this bill go to reducing the size and complexity of government, because the more complex and the larger the size of government the more expensive it is and the more intrusive it is in people's lives. We take very seriously our philosophical and ideological commitment to reducing the size of government and reducing its complexity.

One of the measures that is contained in this bill is about getting rid of a redundant committee whose appointment finished in September last year. I find it quite interesting that it is only the dinosaurs on the other side that are seeking to maintain something that no longer exists. It is not functioning. But they will stand here arguing until there is no more breath left in their body that it should exist. It is incredible that the so-called progressives are seeking to maintain a status quo that is not even a status quo anymore. But do not let the truth get in the way of a good fear campaign!

A lot of our approach to the aged-care portfolio comes from the Productivity Commission's report Caring for older Australians. It found that in Australia we have a highly regulated aged-care sector, which is great in some respects but very incompatible with the new and changing way Australians want to age and have a say in how they age and where they age. They want to live at home as much as possible and they want a say. They are much more empowered than ever before.

I heard senators opposite, when talking about the aged-care provisions, talk about a lack of consultation. I again completely reject the assertion that this government does not consult and does not listen to the people. In fact it has been those opposite who have not listened to the people since we came to government. They have been refusing to pass the legislation that Australians voted for en masse two years ago. I know that the minister has been travelling across the nation. He has had 51 face-to-face sessions, briefed over 7,000 people and worked with over 30 advisory committees on changes within the aged-care portfolio. To say that these changes in Minister Morrison's portfolio are not part of an approach to aged care that is inclusive and informed is simply wrong. It is simply playing for cheap points by an opposition bereft of good ideas in this portfolio space. I can only go to the Senate committee report on the Living Longer Living Better legislation and look at many of the ideas that they put forward through that process. I have much more to say, but I commend the bill. (Time expired)

James McGrath (Queensland, Liberal National Party) Share this | Link to this | Hansard source

It gives me great pleasure to rise this evening to talk on the Social Services Legislation Amendment (No. 2) Bill 2015. This bill will introduce three measures into the social services portfolio. In the first measure the bill will amend the social security law to streamline the current income management program under a two-year continuation. Income management and the BasicsCard will continue for two additional years to maintain support for existing income management participants. The income management element of the Cape York Welfare Reform will also continue for two additional years to June 2017 in line with the rest of the income management streamlining measures.

The streamlining amendments made by this bill will enable more effective operation of the income management program; for example, certain incentive payments relating to income management will be abolished, the operation of the vulnerable measure of income management will be refined, and minor amendments will be made to remove ambiguities and improve the program's effectiveness. These amendments were previously intended to commence in July of this year; however, they will now generally commence on the day after royal assent. Savings provisions will allow qualifying periods for the incentive payments to continue to accrue until late 2015.

The bill also makes amendments to reflect two measures relating to aged care which were included in the 2014-15 Mid-Year Economic and Fiscal Outlook announcement. The bill will formalise ceasing payment of residential care subsidy to residential aged care providers for holding a place for up to seven days before a care recipient enters care. The savings associated with this measure, as stated in the explanatory memorandum, have largely been realised through amendments to the Aged Care (Subsidy, Fees and Payments) Determination 2014 and the Aged Care (Transitional Provisions) (Subsidy and Other Measures) Determination 2014. However, the bill will ensure that the subsidy appropriately continues to be targeted to people actually receiving care.

Lastly, the bill will reflect the government's decision to abolish the Aged Care Planning Advisory Committees as part of the Smaller Government initiative. The Aged Care Planning Advisory Committees' role was to provide advice in relation to the distribution of aged care places. However, the last of these committees expired in September 2014. These amendments repeal the now-redundant relevant provisions of the Aged Care Act 1997.

I would like to focus on the three schedules within this particular bill. The first relates to the income management regime. Income management and the BasicsCard will continue for two additional years to maintain support for existing income management participants. The amendments in schedule 1 will make a number of changes to streamline the income management program to enable more effective operation of the program. This schedule: provides for the abolition of certain incentive payments relating to income management; amends the operation of the vulnerable measure of income management; and makes minor amendments streamlining the operation of income management, removing ambiguities and providing for more effective operation of the program. The financial impact statement of the explanatory memorandum for this bill shows the financial impact over the forward estimates to be just over $144 million for this measure. The amendments made by the schedule generally commence after royal assent.

To ensure that vulnerable people benefitting from income management continue to receive support, the government has committed this $146 million to extend a streamlined version of income management to all existing locations until June 2017. This will align end dates across all 12 locations across Australia. The alignment extends to the income management element of Cape York Welfare Reform, which will also continue until the end of June 2017. This will enable income management to continue to provide additional support in disadvantaged locations for vulnerable people, children and families. The government is uniquely positioned, through the provision of welfare and family payments, to use income management to support vulnerable families by assisting them to stabilise and take control of their financial circumstances. This funding also included a limited expansion to new locations which may need additional support and would benefit from the income management program.

In response to a request from the South Australian Premier in the wake of the Chloe Valentine tragedy, in August 2015, Minister Morrison announced that the child protection and voluntary measures of income management will be introduced to the Greater Adelaide region from October of this year. This bill will streamline the program while ensuring continued support to people who benefit from income management. Streamlining includes the removal of social worker assessed referrals through the vulnerable welfare recipient measure, as this was an underutilised tool by social workers and highly resource intensive. The removal of this will also allow social workers to better service their vulnerable clients.

While participants remain able to adjust how they use their funds to meet priority needs at any time, they will no longer be required to discuss these arrangements with Centrelink every eight weeks. The phased removal of the matched savings payment, which offers people on compulsory measures up to $500 in matched savings if they complete an approved money management course and have demonstrated an appropriate savings pattern over a 13-week period, will cease from December 2015 as they were largely undersubscribed and costly to administer. The phased removal of the voluntary incentive payments, which offer individuals a payment of $250 for every continuous period of 26 weeks will cease on 28 December 2015, as evaluations have shown that incentive payments are not the main driver for people commencing income management and that they can create a dependency on the program. The BasicsCard Merchants approval framework will also undergo administrative and policy changes that will simplify the model, improve the customer experience and remove unnecessary customer contact. The streamlining arrangements will achieve a saving of approximately $36 million over two years.

In relation to the second schedule, which is 'ceasing residential care subsidy for pre-entry leave', this measure ceases the payment of residential care subsidy for care recipients during a period of leave taken before entering a residential care service. It also makes consequential amendments to fee and leave provisions. Under the Aged Care Act 1997, providers are paid the residential care subsidy for the care they provide to care recipients. The residential care subsidy is also paid when care recipients are on leave—usually, at a reduced rate.

To facilitate the entry of care recipients into residential care, a care recipient may take leave for up to seven days before entry, as outlined in section 42-3(3) of the Aged Care Act. This is referred to as 'pre-entry leave'. During this period, the residential care service reserves the care recipient's place, but the care recipient does not receive care. Currently, subsidy for the pre-entry period is paid to providers at the rate of 30 per cent of the full residential care subsidy that will be payable once the care recipient enters care. The government will no longer pay the residential care subsidy or supplements during this period. The amendments made by this schedule commence on the day after royal assent.

These amendments effectively formalise the ceasing of payment of residential care subsidy to residential aged-care providers for holding a place open for a care recipient. These changes better target aged-care expenditure by only paying care subsidies on behalf of people who have actually entered permanent residential care. The savings associated with this measure, as stated in the explanatory memorandum, have largely been realised through amendments to the Aged Care (Subsidy, Fees and Payments) Determination 2014 and the Aged Care (Transitional Provisions) (Subsidy and Other Measures) Determination 2014. The amendments in the bill formalise these changes in the principal act. Previously, subsidy for the pre-entry period was paid to providers for up to seven days at the rate of 30 per cent of the full residential care subsidy that will be payable once the care recipient enters care.

Care recipients will still be able to take pre-entry leave prior to entering an aged-care service. The provider will not be able to recoup any lost residential care subsidy from the care recipient. However, the aged-care provider will still be able to charge the care recipient the standard resident contribution for the pre-entry period. Previously, any days taken as pre-entry leave were counted as part of the care recipient's entitlement to 52 days of social leave from the aged-care service. Under these amendments, the 52-day cap on social leave will not include any leave that was taken as pre-entry leave. This ensures any pre-entry leave taken by a care recipient does not negatively impact on their ability to take other forms of leave from the residential care service. The impact of lost pre-entry leave payment revenue should be considered in the context of other recent aged-care changes, such as the redirection of the former government's workforce supplement into the general pool of aged-care funding and the introduction of a higher level of accommodation supplement. The government is expected to provide $11 billion for residential care subsidies in 2015-16.

Schedule 3 of this bill removes the provisions that allow for the establishment of aged-care planning advisory committees. Aged-care planning advisory committees were established in all states and territories. Their role, when called upon, was to advise the department on the most appropriate distribution of new aged-care places across aged-care planning regions. The last appointments to the various committees expired in September 2014. The amendments made by this schedule commence this year. In December 2014, as part of the 2014-15 Mid-Year Economic and Fiscal Outlook, the government announced that aged-care planning advisory committees would be abolished, with ongoing functions to be performed by the Department of Social Services. This forms part of the third phase of the Smaller Government reforms, which reduce the size and complexity of government, streamline services and reduce the cost of government administration. These amendments repeal the now redundant relevant provisions in the Aged Care Act 1997. The government remains committed to engaging with stakeholders and obtaining local intelligence as part of the needs-based planning framework. Consequently, the department has consulted with a broad range of aged-care stakeholders to help inform the distribution of aged-care places in relation to the 2015 aged-care approvals round, which was announced in August 2015.

I would now like to look at the committee's views in relation to this bill. The Senate Community Affairs Legislation Committee tabled its report on the bill on 15 June 2015. The committee, chaired by Senator Zed Seselja, did not recommend any changes to the bill. There was only one recommendation—that the bill be passed.

I think it is important to place on record the views of committee as outlined in the following paragraphs of its report:

2.26 The committee acknowledges concerns raised by submitters about extending compulsory income management for a further two years. However, the committee notes income management programs have been in place since 2007 and have assisted around 25,000 Australians. The committee is satisfied the proposed changes, together with the government's additional investment in financial wellbeing, will deliver more streamlined and cost-effective income management programs.

2.27 The committee also acknowledges the concerns raised about removing incentive payments for people entering voluntary income management. The committee supports measures to assist people seeking to better manage their incomes, but accepts the existing measures are administratively inefficient and that these funds are better directed at initiatives to improve financial management skills.

2.28 The committee further acknowledges the concerns raised about changes to the process for determining classes of vulnerable persons, particularly the possibility that objective criteria may cause people to enter income management programs when their particular circumstances may not warrant this. The committee accepts that the existing case-by-case process is under-utilised and administratively burdensome. Moreover, the committee is satisfied that by requiring the Minister to determine classes by legislative instrument, the Parliament will have opportunity to ensure the criteria are appropriate and retain adequate flexibility.

In summing up, this bill does introduce three quite sensible measures into the social services portfolio. In the first measure, the bill will amend the social security law to streamline the current income management program under a two-year continuation. Income management and the BasicsCard will continue for two additional years to maintain support for existing income management participants. The income management element of the Cape York welfare reform will also continue for two additional years to 30 June 2017 in line with the rest of the income management streamlining measures.

The streamlining amendments made by this bill will enable more effective operation of the income management program. For example, certain incentive payments relating to income management will be abolished, the operation of the vulnerable measure of income management will be refined, and minor amendments will be made to remove ambiguities and improve the program's effectiveness.

These amendments were previously intended to commence generally on 1 July 2015. However, they will now generally commence on the day after royal assent. Savings provisions will allow qualifying periods for the incentive payments to continue to accrue until late 2015.

The bill also makes amendments to reflect two measures relating to aged care which were included in the 2014-15 Mid-Year Economic and Fiscal Outlook announcement. The bill will formalise ceasing payment of residential care subsidy to residential aged-care providers for holding a place for up to seven days before a care recipient enters care. The savings associated with this measure, as stated in the explanatory memorandum, have largely been realised through amendments to the Aged Care (Subsidy, Fees and Payments) Determination 2014 and the Aged Care (Transitional Provisions) (Subsidy and Other Measures) Determination 2014. However, the bill will ensure that the subsidy appropriately continues to be targeted to people actually receiving care.

Lastly, the bill will reflect the government's decision to abolish the Aged Care Planning Advisory Committees as part of the Smaller Government initiative. The Aged Care Planning Advisory Committees' role was to provide advice in relation to the distribution of aged-care places. However, the last of these committees expired in September 2014. These amendments repeal the now redundant— (Time expired)

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

I would like to start my contribution on the Social Services Legislation Amendment (No. 2) Bill 2015 by humbling myself in some way before this chamber. I want to say up-front that I do not have all the answers in this area, and I certainly do not know what the best approach is to tackle the crushing cycle of welfare dependence that exists in some of our communities, particularly in some Indigenous communities. I do not pretend to have all of the answers. Many governments of good intentions from different sides of politics have tried lots of different approaches in the past few decades, and yet we still have not substantially improved outcomes in many Indigenous communities and, indeed, in some respects, in some areas we have probably gone backwards in the past half a century, despite those good intentions and certainly substantial financial resources. I think it actually would be beneficial if, more often, we admitted to the fact that we do not have all the answers. Sometimes I suppose showing humility in politics makes you vulnerable—as if showing some form of weakness or timidity. But in fact what it would show I think is perhaps a little more honesty with the Australian people—that these matters involve the interaction of complex issues that no-one and no political party has a complete answer for.

What should you do in that environment? What should you do when you do not necessarily know the answer—when you have a good intention and when you want to commit substantial resources to tackle a problem but you do not exactly know what might be the best solution? I would suggest that the best approach in such an environment of uncertainty is to trial different things. The best approach is to have a go at trialling different ways of doing things, and that will provide you with a real-world comparison of different policies and different approaches.

Unfortunately, public policy is not an exact science. We do not have a lab environment which allows us to test different policies and then weigh the results like a scientist would, and then establish theories or hypotheses on the basis of that experimental evidence. We cannot do that. But we could more often seek to trial different approaches in public policy and have a genuine and good-faith attempt to judge the results of those policies.

Much of what we are discussing in this bill—at least, in schedule 1 of this bill—goes to a trial that was introduced by the then Howard government in the Northern Territory emergency response for income management in Indigenous communities in the Northern Territory, and I will expand further on why I think this trial was important and it is important to build on the results that have been established by this trial.

Before I do that, I want to recount a trip that Minister Nash, who is sitting in front of me here tonight, and I took to Mornington Island a few months ago. It is in the gulf region of Queensland. It is basically just off the bottom of the Gulf of Carpentaria off the Queensland coast. We were joined by Minister Scullion, the Minister for Indigenous Affairs. I should also give credit to Senator Barry O'Sullivan, who helped organise and facilitate the visit after he was there a few months earlier. That visit confirmed to me both the scale of the issues and problems we encounter in this area and our lack of easy, ready-made, off-the-shelf solutions to the problems.

I am not going to spend too much of this speech recounting those issues because that would not leave me the time to talk to this bill. But certainly lack of any major industry or employment source apart from government funded programs is, to me, a real issue in communities such as these. When almost the entire community is dependent in some way, shape or form on money coming from outside, on wealth being generated from outside and on the decisions of different governments to provide them assistance and support to provide for their future, clearly that reduces the enterprise, initiative and, I would argue, too, the dignity of individuals in a community.

We met many great people at Mornington Island trying to drag their community forward, but it appears very difficult to do so when there is a culture of depending on welfare. There does not seem to be a culture for the majority of able-bodied males and females to be working, at least in the sense that we probably consider working for a job. There is no easy way to break that cycle, I think, once it gets going. It is a cycle, and it is a self-perpetuating one in some respects as well. Once the cycle has started, we are caught in a dilemma between wanting to continue to provide support and assistance to people who clearly need it and also wanting not to perpetuate a culture and cycle of dependency. Trying to do both of those things at once is an incredibly difficult public policy trade-off and one I think governments still struggle with today.

I think the topic of schedule 1 of this bill—an income management regime—is a method that should be supported and applauded for being introduced. I note that the Labor government which took over not long after it was introduced did continue it. There were some changes made to it, but generally it was continued. This bill seeks to continue to support, in general, this program as well as to make some further adjustments and amendments.

I know there is some controversy about some of those amendments, but in broad terms there is widespread support for the existing income management regime as first introduced by the Howard government in 2007. That scheme has been expanded by various governments since then and now includes not just Indigenous but non-Indigenous people as well across the Northern Territory and, indeed, the entire country.

Income management, in very simple terms, seeks to set aside or quarantine a proportion of a recipient's income support payment to pay for necessities such as food, clothing, housing and utilities. Recipients of welfare under these programs can spend their income managed funds using a BasicsCard or by arranging for Centrelink to make a payment on their behalf—for example, regular rental payments or other bills. Recipients can use their BasicsCard only at approved merchants and cannot use it to buy excluded goods, such as tobacco, alcohol, pornography or lottery tickets.

As I suggested earlier, the outcomes have been broadly positive. Although this is certainly not a panacea for the issues that face many communities, the outcomes from these programs show that those who have been placed on income management now substantially continue to use the scheme voluntarily. Apparently, about two-thirds of people who have been placed on income management now use the scheme voluntarily. That itself is a vote of confidence in these programs. If a substantial and clear majority of welfare recipients are themselves choosing to be on the schemes, I believe it would be greatly remiss of this chamber or this parliament if we were to end such schemes.

It is also telling that, if some of the basic needs of these families are being met, in some of these regions the social issues that have previously caused relationship breakdown and emotional fractures are potentially being altered. The gaps that have at times occurred in households because of mismanagement, traps of temptation or dysfunctional lifestyle choices are being curbed for the betterment of household recipients and their dependents.

The broader social impacts are positive too. A household whose benefits were previously spent largely in the first couple of days after receipt of payment now has a kitchen with food for their child every day. Benefits flow on to the child's education and their ability to engage with peers and build social skills and awareness rather than be disruptive or show inattentive behaviour because of hunger. That is extremely important.

Although the income management programs are being implemented to assist with skills, it is important to remember that they are modelling a balance to children and other members of the community as well. It is habit forming. We can continue to talk about child, youth and family intervention as a priority or we can create and support some practical programs to assist with lifestyle changes.

That is why I support the government committing a further $146.7 million to ensure the vulnerable people benefiting from income management continue to receive support. This will be done by extending a streamlined version of income management programs to all existing locations until 30 June 2017, and then systematically we will align the end dates across all 12 locations across Australia. The alignment extends to the income management element of the Cape York Welfare Reform program, which will also continue until 30 June 2017. This will enable income management to continue to provide additional support in disadvantaged locations for vulnerable people, children and families. Additional support is also provided to people on income management through support from social workers and other specialist staff. As I said earlier, there are 12 locations across the country where income management is used, including: the Northern Territory and Cape York, which I have already mentioned; the Perth metropolitan area; the Peel and Kimberley regions in Western Australia; in Queensland, there is Logan, where I grew up, and Rockhampton, where I now live; Bankstown in New South Wales, greater Shepparton in Victoria and Playford in South Australia. It is also in some Indigenous communities—for example, the APY region in South Australia.

Income management participants have priority access to financial capability services. These include money-management courses and other assistance for people experiencing ongoing financial difficulties. Aside from the Cape York model, there are seven separate income management measures. Measures differ according to whether they are voluntary or compulsory, by the group they target, whether this group is identified on a case-by-case basis or through membership of a class and by the percentage of a person's income support that the measure quarantines. The Cape York model operates using a single distinct measure—case-by-case referral by the Family Responsibilities Commission—and is unlikely to be affected by the measures in this bill.

Streamlining also includes the removal of social worker assessed referrals through the Vulnerable Welfare Recipient Measure, as this was an underused tool by social workers and highly resource intensive. The removal will allow social workers to better service their vulnerable clients. While participants remain able to adjust how they use their funds to meet priority needs at any time, they will no longer be required to discuss these arrangements with Centrelink every eight weeks. There will also be a phased removal of the Matched Savings Payment, which offers people on the compulsory measures up to $500 in matched savings if they complete an approved money-management course and have demonstrated an appropriate savings pattern over a 13-week period. It is intended that these programs will cease from 31 December 2015, as they were largely undersubscribed and costly to administer. I note that at estimates recently the department gave evidence that only 45 payments had been made under the Matched Savings Payment since the beginning of the scheme, although by January this year it had risen to 57—obviously not a substantial take-up of this program over almost five years.

The phased removal of the Voluntary Incentive Payments, which offer individuals a payment of $250 for every continuous period of 26 weeks, will cease on 28 December 2015—which is the day 26 weeks after 30 June this year— as evaluations have shown that incentive payments are not the main driver for people commencing income management and that they can create a dependency on the program. The BasicsCard Merchants Approval Framework will also undergo administrative and policy changes that will simplify the model and improve the customer experience, removing unnecessary customer contact. The streamlined arrangements will achieve a saving of approximately $36 million over two years. This funding also included a limited expansion to new locations which may need additional support and would benefit from the income management program.

I note finally for Schedule 1 that, in response to a request from the South Australian Premier in the wake of the Chloe Valentine tragedy, the minister announced the child protection and voluntary measures of income management will be introduced to the Greater Adelaide region from October 2015.

In the time I have available I will mention some of the elements in the remaining two schedules. The amendments in Schedule 2 seek to formalise the ceasing of payments of the residential care subsidy to residential aged care providers for holding a place open for a care recipient that is a targeted one of a specific set of outcomes. These changes better target aged care expenditure by only paying care subsidies on behalf of people who have actually entered permanent residential care The government currently pays a residential care subsidy to approved providers who supply residential care to a person approved to receive that care. The subsidy is paid for each day that the recipient is cared for and accommodated in a residential facility and when the recipient is on approved leave. One type of approved leave is pre-entry leave—that is, leave undertaken by the recipient before the commencement of residential care. The savings associated with this measure, as stated in the explanatory memorandum, have largely been realised through amendments to related pieces of legislation, but the amendments in this bill formalise these changes in the principal act.

Previously, subsidy for the pre-entry period was paid to providers for up to seven days at the rate of 30 per cent of the full residential care subsidy that would have been payable, once the care recipient enters full-time care. Care recipients will still be able to take pre-entry leave prior to entering an aged care service, but the provider will not be able to recoup any lost residential care subsidy from the care recipient. However, the aged care provider will still be able to charge the care recipient the standard resident contribution for the pre-entry period. Previously, any days taken as pre-entry leave were counted as part of the care recipient's entitlement to 52 days of social leave from the aged care service. Under these amendments, the 52-day cap on social leave will not include any leave that was taken as pre-entry leave. This ensures any pre-entry leave taken by a care recipient does not negatively impact on their ability to take other forms of leave from the residential care service. The impact of lost pre-entry leave payment revenue should be considered in the context of other recent aged care changes, such as the redirection of the former government's workforce supplement into the general pool of aged care funding and the introduction of a higher level of accommodation supplement. The government is expected to provide $11 billion for residential care subsidies in 2015-16.

Finally, Schedule 3 of the bill ends the Aged Care Planning Advisory Committees as part of the government's decision to drive efficiencies and smaller government. These reforms are part of the broader push to reduce the size and complexity of government, to streamline services and to reduce the cost of government administration. The government has rationalised or amalgamated a number of different bodies since coming to government. Specifically, Item 3 of Schedule 3 repeals section 12.7 of the Aged Care Act 1997 so that the secretary can no longer establish Aged Care Planning Advisory Committees. Each financial year the minister determines the number of aged care places available for allocation in each state and territory for each type of care. The Aged Care Planning Advisory Committees were established in all states and territories to advise the department on the most appropriate distribution of new aged care places across aged care planning regions. Specifically, the Aged Care Planning Advisory Committees give advice about the distribution of places among regions and the proportion of care to be provided to certain groups of people. However, the last appointments to the various committees expired in September 2014 so last year the government announced that these advisory committees would be abolished with ongoing functions to be performed by the Department of Social Services.

The government has made it clear that it remains committed to engaging with stakeholders and obtaining local intelligence as part of the needs-based planning framework. The department has consulted with a broad range of aged care stakeholders to help inform the distribution of aged care places in relation to the 2015 Aged Care Approvals Round, which was announced on 15 August 2015.

I commend this bill to the chamber and in particular the additional $150 million the government is providing to the income management regime, which is working well and I hope it will continue to be supported with this injection of resources so it can continue to work well in the future.

Anne Ruston (SA, Liberal Party) Share this | Link to this | Hansard source

I too rise today to make a contribution in support of the Social Services Legislation Amendment (No. 2) Bill 2015. As has previously been mentioned, this bill has three particular measures that are affecting the social services portfolio. Firstly, the bill seeks to amend social security law to streamline the current income management program under a two-year continuation. The bill also makes amendments to reflect two measures relating to aged care, which were included in the 2014-15 May MYEFO announcement. What I particularly want to talk about tonight are the income management changes and the need to ensure that income management is something that can be continued into the future, because it is such an important tool in our community. It is also a very valuable tool in a community in the state that you, Mr Acting Deputy President Gallacher, and I come from.

Basically, income management works by managing payments from government departments in such a way as to prioritise the needs of people who are on lower incomes but particularly those people who have had some difficulty in managing their incomes and meeting their requirements and commitments—such as rent, general bills, utility bills, food and education, which are some of the pretty basic requirements of life. These people have proven over a period of time that they have not been able to manage these payments and so income management has become an extraordinarily important tool in their lives to ensure that they do not get themselves into financial trouble or, more particularly, that they do not end up subjecting their families and particularly their children to some really unpleasant circumstances because of a lack of income to be able to afford to provide these basics.

Income management means that as a rule you cannot spend your money on such things as alcohol, tobacco or tobacco products, pornographic material, gambling, home brew kits et cetera—all of those are things that I think the majority of people would consider to be non-essential items in the daily or weekly budget and things that are luxury items that one is only able to have when one has excess income and is able to afford them. People can voluntarily elect to use income management or, in more extreme cases, people can be referred or requested to use it as part of a process that they undertake. Income management could possibly be a form of rehabilitation or it could simply be used because there is a need to protect the interests of those people that are unintended bystanders or are implicated in the actions of somebody who may require income management. Social workers, private protection agencies and even an approved housing authority can refer somebody for consideration for income management.

Income management has been around for a number of years, and Australia certainly leads the way in using income management as a tool—that is why it is important that the ongoing sustainability of income management is ensured and that we continue to look at the existing programs to make sure that there are ways that we can make them better, that we can make them more efficient and that we can make sure that they are affordable into the future. The Social Services Legislation Amendment (No. 2) Bill is one such piece of legislation that is seeking to make sure that we can continue income management into the future.

As I said, Mr Acting Deputy President, in a community in the state that you and I come from we have seen the introduction of an income management tool that has been welcomed with open arms by the whole community—the community that I am referring to is Ceduna on the west coast of South Australia at the start of the Nullarbor Plain, just before the Western Australian border. This program was introduced about 12 months ago at the request of the local community and a number of different residents in the local community. It was interesting that before the introduction of this program was proposed, there was a massive amount of community consultation—not just with the people in the community who potentially were the recipients of this particular scheme but also with those people who were impacted on by the behaviours and the like of those that this scheme is now applying to. The response that was received from these consultations was quite overwhelming—over 50 meetings took place in the communities that surround the Ceduna area, not just in the township of Ceduna. It was basically aimed at trying to stop the cycle of alcohol, violence and abuse that occurred in the community. I have had the pleasure on a number of occasions of visiting this community, particularly to look at the incidences of the alcohol-fuelled activity that was occurring in the community and the consequences of that activity.

After spending a number of days with the police, with the patrol squads and with the medicos, attending the hospitals and the clinics, it became very obvious that the behaviour of the few, who subsequently have gone on income management, was having a major impact on the entire community. The community was almost brought to its knees by these activities.

The interesting thing was that the people who seemed to be most keen for the introduction of an income management scheme were not the people actually indulging in the excessive consumption of alcohol. More often than not, they were the people who were suffering the consequences of that—the ones whose children were going without food, the ones who were the recipients of the violence. So it was interesting to see, when the program was introduced, how widely it was taken up in the communities. I commend the Minister for Indigenous Affairs, who is in the chamber, for the massive amount of work that he has done, not just with the community in Ceduna to which I refer but with communities around the whole of Australia where income management systems have been put in place and have served to improve the conditions for everybody in those communities. It is a highly commendable program and the reason I am so keen to be here to support an amendment bill that would assist in making sure that this particular program continues to be sustainable into the future.

The bill seeks to continue a level of income management and to streamline the measures contained within the income management system so that the operation of the program can become more efficient and effective. For example, certain incentive payments relating to income management will be abolished, the operation of the vulnerable measure of income management will be refined, and there will be a series of other minor amendments to remove ambiguities and improve the program's efficiency. Initially, we were hopeful that these amendments might be able to come into effect on 1 July 2015. However, given the delay in the bill's introduction into the House and the fact that, obviously, the bill cannot come into effect until after royal assent, the savings will only accrue from that period.

The other two measures contained in this bill relate to aged care. One relates to the residential care subsidy for pre-entry leave, and the other relates to aged-care planning advisory committees. Schedule 2 concerns the residential care subsidy for pre-entry leave. These amendments seek to formalise the cessation of the payment of the residential care subsidy to residential aged-care providers for holding a place open for a care recipient. Basically, these changes seek to better target aged-care expenditure by only paying a care subsidy for people who have actually entered permanent residential care. The savings associated with this measure, which are quite clearly outlined in the explanatory memorandum, have largely been realised through amendments to other pieces of legislation, such as the Aged Care (Subsidies, Fees and Payments) Determination 2014 and the Aged Care (Transitional Provisions) (Subsidy and Other Measures) Determination 2014. The amendments in the bill formalise these changes in the principal act.

Previously, the subsidy for the pre-entry period was paid to providers for up to seven days, at the rate of 30 per cent of the full residential care subsidy. That will be payable once the care recipient enters care. The care recipient will still be able to take pre-entry leave prior to entering the aged-care service, but the provider will not be able to recoup any lost residential care subsidy from the care recipient. However, the aged-care provider will be able to charge the care recipient the standard resident contribution for the pre-entry period. In the past, any days taken as pre-entry leave were counted as part of the care recipient's entitlement of 52 days of social leave from aged-care services. Under the amendments that we are seeking today, the 52-day cap on social leave will not include any leave that was taken as pre-entry leave. This ensures that any pre-entry leave taken by a care recipient does not negatively impact on their ability to take other forms of leave from the residential care service.

The lost pre-entry leave payment revenue should be considered in the context of other recent aged-care changes, such as the redirection of the former government's aged-care workforce supplement into the general pool of aged-care funding, and the introduction of a higher level of accommodation supplement. The government is expected to provide probably around $11 billion for residential care subsidies in the 2015-16 year. As the previous speaker, Senator McKenzie, said, in attempting to make the necessary changes in this area, it is interesting to note that there seems to be a lack of understanding about the long-term affordability of an ageing population and the need to make what are reasonably small changes in the interests of ensuring the sustainability of our aged-care sector into the future.

Schedule 3 of the Social Services Legislation Amendment (No. 2) Bill relates to aged-care planning advisory committees. One of the things that are very evident across the board in both the federal parliament and many state parliaments under Labor governments is the excessive need to expand the size of the public sector through not only the employment of additional people in the public service to deliver things that, in many instances, could be delivered at least as well, if not better, by the private sector but also this absolute proliferation of government boards, committees, advisory committees, standing committees, whatever you want to call them. There seem to be such an amazing number of people who are employed by or are required to advise government and government authorities, statutory authorities and the like.

In the interests of trying to achieve one of the election promises of this government—that is, smaller government; a government that only does what it can do, what it has to do and what it should do, not a government that seems to think that it knows best and should do absolutely everything for everybody—we are seeking through schedule 3 of this bill to abolish the aged care planning advisory committees. The services that are currently provided and that we believe are necessary from this group should be absorbed into the Department of Social Services. We do so in the belief that this department has the capacity and the existing resources to undertake the necessary advice to government as part of its normal day-to-day processes. This is a commitment that we made on 15 December 2014 as part of the Mid-Year Economic and Fiscal Outlook. We said that this was what we were going to do.

This schedule forms part of the smaller government reforms that we said we were going to implement to reduce the size and complexity of government, to streamline services and to reduce the cost of government administration. This is just another example of some simple actions that are going to have very, very little, if any, impact on the outcome for the people who are affected by this area of government administration. We can take a level of bureaucracy out of government, without having any impact on the delivery of the outcome. So, it is a case of smaller government, reduce the processes, make sure the processes do not outweigh the outcome in terms of their level of importance.

The original role of these aged care planning advisory committees was to provide advice on the distribution of aged care places. However, the last of these committees expired in September 2014. In a sense, all that schedule 3 of this bill really seeks to do is to make the necessary amendments to repeal what has now already become a redundant provision in the Aged Care Act. The government certainly remains absolutely committed to engaging with stakeholders to make sure that we continue to gain local intelligence and pursue a needs basis planning framework so that we are not putting a massive amount of framework in place and then worrying about whether we actually need it. What we are seeking to do is to minimise the amount of framework and processing that we are putting in place and just constantly keeping an eye on it to make sure that nothing falls between the gaps. We are taking very much a minimalist approach to how we deal with this activity within government. As I said, this is an approach we are taking not just within the aged care sector but more broadly across government. This government is one that is striving very hard to try to reduce the level of bureaucracy, red tape, compliance and burden that we continue to put on all of our sectors, whether they be the private or the public sector, in the delivery of an outcome so that they are able to do so in the most efficient, effective and unencumbered way.

To ensure that in changing these things we have covered off and that we have not left anything so that there are any problems out there, the Department of Social Services has consulted with a very broad range of aged care stakeholders to make sure that the information that the system needs in relation to aged care places is well informed—and certainly that appears be the case. The aged care approvals round, which was announced on 15 August 2015 was, we believe, particularly well informed by the process of negotiation that took place with the aged care sector.

It is with great pleasure that I stand tonight to make a contribution to the Social Services Legislation Amendment (No. 2) Bill 2015 and commend it to the parliament, because it seeks to do a number of things specifically in relation to the social services portfolio. More broadly, it is just another plank in the platform of the current coalition government in its attempt to make sure that we responsibly and respectfully manage all of our portfolios so that they are sustainable into the future and continue to be able to be funded and to be affordable into the future and that we continue to try and reduce the size of particularly the Public Service, the public sector, and public administration in areas where there is not necessarily any specific outcome being delivered by the level of compliance burden, regulation et cetera that is put in place.

I am particularly keen to commend the bill because I believe it is certainly an example of the summation of what good and responsible small government is all about and that it adds to a raft of reforms and projects that this government has implemented to ensure that we provide responsible, efficient and effective government for all people and across all portfolios in this current administration. I commend the bill to the House.

David Fawcett (SA, Liberal Party) Share this | Link to this | Hansard source

I also rise to make some comments on the Social Services Legislation Amendment (No. 2) Bill 2015. I will speak briefly about the outline of the bill, and then I would like to make a few comments based on my time in the other place when I was the local member for one of the areas that is impacted by this legislation.

The bill has two large sections. One is the streamline income management section—that is schedule 1 to the bill—which amends the social security law to streamline the current income management program under a two-year continuation. So the income management, the BasicsCard, will continue for an additional two years to support the existing income management participants. The streamlining provisions of this bill will enable a more effective operation of the income management program. In particular, the bill provides for the abolition of certain incentive payments relating to income management, amends the operation of the vulnerable measure of income management and makes minor streamlining amendments to remove ambiguities and improve the program's effectiveness.

The second area is around schedules 2 and 3, which are aged-care measures. They make amendments to reflect measures regarding aged care which were included in the 2014-15 Mid-year Economic and Fiscal Outlook announcement. The first of these measures is to cease payment from 1 July 2015 of a residential care subsidy to aged-care providers for holding a place for up to seven days prior to a recipient entering care. The second is to abolish the Aged Care Planning Advisory Committee as part of the smaller government initiative. I will come back to aged care in a minute.

I would like to talk firstly about the City of Playford, which I had the privilege of representing when I was in the other place. For many years I had worked at the RAAF base at Edinburgh as a test pilot and eventually as the commanding officer of the aircraft research and development unit, so I had flown over this area known as the Peachey Belt within the City of Playford for many years without interacting all that much with the community. But when I put my hand up to become the member for Wakefield, I resigned from the military and I spent many months as an unpaid candidate doorknocking and getting to know the community in that area. People like Shaun Barby from the Peachey Belt Residents Association, the mayor—Marilyn Baker at the time and later Martin Lindsell—and a range of people embraced the fact that I was taking an interest in this community.

Whilst it has had a pretty poor reputation at various times and the socioeconomic figures are next to Redfern's in terms of its being an area of disadvantage, there was actually a strong sense of community within the Peachey Belt area, and I grew to appreciate and work closely with many people who lived in that area and who had a great aspiration to see the area develop and improve. This included residents and people in organisations such as Anglicare, UnitingCare and others who ran programs such as food banks and carers associations in the Peachey Belt area. There was a range of people who wanted to make life better, particularly teachers at schools such as Swallowcliffe who worked with young people, young Australians, who came from some very disadvantaged backgrounds. It really opened my eyes to the needs as well as the strengths of a particular community within Australia.

What really struck me, though, was the fact that there were parts of the community who were intergenerationally unemployed, and we are talking people who are second, third and in some cases even fourth generation unemployed. But some young people amazed me, and I think of one young man in particular who lived in Munno Para in the eastern part of that area and went to Gawler High School. Despite having quite a dysfunctional home life and couch surfing for much of his time, he ended up achieving fantastic results in year 11 and year 12 and went on with quite an artistic flair to study music at the Elder Conservatorium of Music in Adelaide. That just really highlights the fact that you cannot put people in boxes. You cannot say that because you come from this area or this is your background that this will limit what you can achieve.

What I also saw was people who had found that living on welfare was all that they aspired to. I came across young people who literally sought to be on a disability support pension. I had young men of 17 or 18 come into my electorate office at the Munno Para shopping centre and complain because they had not been approved to go onto a disability support pension at that age. As I quizzed them and talked to them it became apparent that many of them were capable of achieving far more than they believed they could. As you traced back you could look at the dysfunction that was often present in the family. Sometimes that was due to substance abuse, whether that be alcohol or drugs. Sometimes it was due to dependence on things like pokies, which meant that there was very little money in the family or support for education.

I remember speaking to the police sergeant at the Elizabeth police station once who told me of a young man who had come into the police station and had asked to be escorted home to collect his belongings. The policeman initially told him to move on his way, but this young man persisted. It turned out that he was literally at some risk of violence from his father because this young man had actually got a job, and that was such an undermining of the world view that had been built by his father and his grandfather regarding what they were owed and what they were capable or not capable of doing. This young man had broken the mould to the point that he was at risk of violence.

I raise these points to highlight that whilst 17 per cent of people are unemployed in the Playford area at any given time—the figures vary from year to year—and youth unemployment is significantly higher and around eight per cent of people are long-term unemployed there, depending on the period you look at, the fact is that there are young people who are being impacted by the inability or unwillingness of their parents to use the income that they have to provide for the education, the healthy living and just the basic clothing, diet or activities of young people. This has a significant impact on their willingness, their self-confidence, their ability to take up opportunities that are provided to them.

In 2007, as the member for Wakefield at the time and as the chair of the government's Family and Community Affairs Committee under Minister Brough, I looked at this. The committee looked at the number of services that were being provided. One of the challenges that kept being thrown up to us by providers and even by teachers at schools was the question of: given the amount of resources that we are putting into these areas, why is the dysfunction continuing and why are we not seeing sustainable turnarounds and changes in those communities? One of the things that Minister Brough approved was an audit, which was conducted by Anglicare, if my recollection is correct. They looked to do an audit of the whole area to understand exactly what was being provided, on what basis it was being provided and what outcomes this support was having.

I recall that one of the options that were discussed at the time was income management. You may recall that in 2007 income management was brought in as part of the federal government's Northern Territory Emergency Response. Part of the legislation allowed the option to extend this to areas other than the Northern Territory. When we first started talking about that for some of these communities within Playford, I remember copping a fair shellacking in the media. My political opponent at the time was quite negative about it, but I was satisfied that we were on the right track when I was called by some teachers at one of the local primary schools, who asked to meet with me. I would have to say that they were not naturally supporters of the conservative side of politics, so I went to meet them anticipating that perhaps I would get a bit of a chest-poking. But they were very clear that they saw themselves as being at the coalface of this issue of disadvantage and dysfunction.

These teachers were the ones dealing with young people in grades 1 and 2 who were coming to school having not had breakfast, possibly not even having had dinner the night before—kids who were worse than latchkey children, who were really fending for themselves, who found it hard to concentrate at school because of the lack of nutrition, who found that they were always behind the eight ball because mum—and generally it was only mum, and possibly a stepdad or partner—were down at the pub or out playing pokies. They did not have that support to help them read, and if you look at the early years of learning, during those years that are really crucial to imbue in children an understanding of language, concepts, shapes, colours and names—the things that are the basic building blocks if you want to get ahead in life—often support was not being provided because the parents were spending their time and money on other pursuits. These teachers were saying, 'We support these measures. We live and work at the coalface with these people. We support a change that will make a difference for these children.' That sticks in my mind as I think about income management and the discussions that are occurring now in other areas of South Australia, such as Ceduna, and in areas of Indigenous disadvantage around the country. The fact is that there are some people in our community who, through choice or circumstance or through a lack of training or capacity on their own part—perhaps poor parenting that they have received—lack the will or competence to manage their income.

Whilst income management alone is an effective tool, there are other programs we need to wrap around people. In South Australia I particularly look at groups like Service to Youth Council, who have had a long-term investment in areas such as the Playford City Council, in Elizabeth, and in the Peachey Belt, working with young people to help them overcome many of these areas of disadvantage. Unlike many government programs, which tend to be very stovepiped, holistic approaches are really the only way to help people take a hand up, as opposed to living on a continual hand-out. Whilst income management tries to help people, both to have the money to spend on their children and to avoid them spending it on things like alcohol and gambling, we also need to be wrapping the services around these young people to make up for the gaps in some of the life skills that they have not picked up from their parents.

Service to Youth, in particular, does a great job of providing a holistic model of caring for these young people in South Australia. The results are very clearly shown in the outcomes that they achieve in terms of the number who enter their programs who then go on to secure work and are still in work 12 months later. Their model is very much wrapped around providing care for the person in terms of housing. They have even used their own discretionary funds to create a number of what they call HYPA housing units—Helping Young People to Achieve—because they recognise that if you are couch surfing or have nowhere permanent to live, or if you are a young person from a country area seeking to do an apprenticeship in the city but you have nowhere affordable to live and you are trying to drive home each night or you are living in your car, that is not a way to sustain education and meaningful work outcomes.

They recognise that there are life skills that many of these young people lack because their parents to date have not had income management and have not had the encouragement to invest in their children. They are not work ready. Some of their programs start off with just getting them consistently out of bed on time and turning up to a work place, and starting to shape their understanding and expectation of what it is that an employer might want them to do and the fact that an employer has the right—in fact the obligation—to instruct them, to tell them how to work to keep them safe, and that there is a realistic expectation that they will put in a good day's work to get a good day's return. Coupled with education and, essentially, pastoral care or social work support, we find that many of these young people have good outcomes.

That is great, and I thoroughly commend Service to Youth Council for the work that they do, but surely we should be trying to put systems in place where the family unit, the biological parents of the child, are the ones who have the interest and resources to invest in these kids to give them the life skills that they need to get that start in education and to make that transition from education to work. If the things that cause the dysfunction, the lack of interest and the lack of capacity are so often tied to misuse of money which has come from the taxpayer and is spent on things like alcohol or gambling, then I am 100 per cent behind the measures around income management, coupled with—as I say—things to help people in terms of budgeting and working towards the an independent point where they can manage those funds in their own right.

The other area I will just quickly touch on is the aged care reforms. I mentioned briefly what the outcomes are here. The other comment I would just make on aged care, having held a round of consultations last week with the Assistant Minister for Health and talking with people in rural areas of South Australia, is that the My Aged Care website—which is up; I recognise that we try to streamline information and make it accessible to people—does need to be navigable by the average man in the street. Having looked at it and tried to go through it myself, I believe it is one area where we need to be constantly seeking feedback from users to make sure that things like the My Aged Care website is workable so that people who are seeking residential care and the various payments to go along with it have all the information they need in a useful manner.

One of my strong contentions is that, whilst there are savings to be had by centralising programs and having it all done out of one office, there are also local differences that we see—whether we are talking in the health care area or whether we talking about the aged care area. It is important that, particularly where we have a function that constitutionally has been the responsibility of the federal government, we recognise that there are local inputs that would be required even in something as basic as a national website. While it might appear logical to somebody sitting on the east coast, when someone in Gawler in South Australia looks for a service provider and when something is on the other side of the city, it is clearly not the service that they are going to need. That geographic split may not be known by somebody sitting on the east coast. There are things that we can still be doing to make those systems more effective.

I welcome the measures in the bill and the government amendments to the bill. I particularly welcome the two-year continuation of the income management program, because I have seen firsthand the impacts on young people in Australia when their caregivers—often a mum, often a stepdad or a partner—use the benefits that are provided to them by the taxpayer on things like alcohol and gambling to the great detriment of young people. Anything we can do to improve the circumstances, basic education and care of those young people, every member of this Senate should be supporting it.

Christopher Back (WA, Liberal Party) Share this | Link to this | Hansard source

I rise to associate myself with the comments of my colleague, Senator Fawcett, in supporting the Social Services Legislation Amendment (No. 2) Bill 2015. I pick up on the point that Senator Fawcett concluded with. That is that it ought to be the objective of all of us in this place, and in the wider community, to give to every member of the community the skills that they will need to be able to fulfil a useful life and to be able to realise their potential.

In terms of income management element of the bill, I wish to make some observations, if I may, towards that objective. I think the issue that we have been finding is that there are people through the school system and leaving school—young adults and older adults—who simply have never been given the skills of managing their own household budget and managing their own affairs. In some ways, is it a surprise when people receive funds—never, ever having had the training, skill or preparation in their home—that they are not able to budget, not able to prioritise their expenditures and not able to flourish as human beings? In that sense, I want to support the continuation of this program and the funding the two-year period that has been proposed in this bill.

As has been said previously, income management in this country was introduced in the Territory in 2007. It has now been extended. It was a compulsory measure at that time for welfare recipients in 73 communities. It has now been extended, as we know, to other states in Australia—my own home state, Queensland, South Australia, Victorian and New South Wales. I am interested to see that the budget allocation is some $146.7 million over the two years to continue the program up until the end of June 2017.

But the points that I want to make this evening do go to this question of the capacity of people to be able to manage their money. We know that the welfare budget in this country is around about one-third of the entire expenditure budget of the federal government. We want to make sure, as a generous country, that the funds that are made available to those recipients are used for the purposes for which they are intended—that safety net for which they are intended.

In the family context, there would be nobody who would disagree that the primary objectives of the funding when there are children in the house should be for their protection, for their adequate nutrition, for their housing, for their education and for the family unit itself—however that is structured—to ensure adequate food and that rent and utilities are paid for in the first instance. All too often, as has been said by others, we find a circumstance in which, because of the inability of people to be able to prioritise their spending, we have seen and continue to see expenditures in areas which detract from and leave inadequate the funding for the purposes that all of us would recognise as being essential.

This came home to me during a hearing of the joint committee chaired by the member for Denison, Mr Wilkie, who, at the time, had proposed a mandatory precommitment associated with poker machine gambling. Senator Bilyk may also have been a participant in a hearing in Hobart. A gentleman appeared before the committee. His was not a happy story. He had spent time in jail, he was a chronic alcoholic and was, I think, afflicted by drugs. This man had many issues in his life, but the worst of them, I think, was his inability to be able to control his addiction to gambling, particularly through poker machines. I recall him being asked, 'What was the worst feature of the addiction?' He said, 'Simply, when you have spent all of the money, you then have to go back and face other members of your family'—that is, you have to face up to the fact that you have denied adequate funding to those in your family for the purposes that I have just mentioned: education, food, clothing, housing, payment of rent and payment of utilities.

I also remember he was asked, 'What if a situation existed whereby the payments that were made to you on a fortnightly basis were paid on the basis that there was adequate food in the family for the children and for the adults, that rent was paid, that education costs were met, that utilities were paid and that whatever was excess would then be available to spend?' I recall him saying something like, 'That would be of enormous benefit,' and that it would remove the guilt associated with the spending of moneys on activities such as gambling, in that particular case. It really came home to me then that some of the objectives of the income management program played out in the mind of that person.

We know that in this country there have been evaluations through a number of reports assessing the effectiveness of the different trials. A substantial number of people have reported that income management does make their lives easier. It makes it easier to manage their money, it makes them feel safer—and that is an interesting point that I hope would be reflected also in those for whom they have responsibility—and it has improved their lives and those of their children. That is a topic to which I have referred.

The report A review of child protection income management in Western Australia in 2014 found that this was a useful tool to help achieve the stability required so that families could stay together by reducing the risk of neglect or homelessness. Child protection staff reported that at first many clients were not happy about being put onto income management, but they then found that the person would realise the benefits of stabilised housing, reduced stress through the payments of bills and debts and greater certainty in being able to provide food and clothing for themselves and their children. Once again that theme comes through.

I do have the benefit of being able to draw on relevant experience in a different country. In 2008 I was invited to be a founding member of the board of the MyKasih Foundation in Malaysia, and I continue to be an active member of that board. In that country there is no established safety net and there is no equivalent of Centrelink. I am very proud to say that the MyKasih Foundation now assists some half a million people in Malaysia on an annual basis with the provision of funding to assist with household management. This particular foundation is blind to ethnic background; it is blind to geographic background; it is blind to religious background. It works on the basis that funding is given on a fortnightly basis to the mother of the family. It goes specifically to the mother of the family because in that culture it is she who has the responsibility for the provision of these services in the home.

The funds are made available onto a card system, which happens to be the Malaysian identification card, the MyKad. That gives that lady the dignity of being able to shop throughout the week using a card—a feature that we take for granted in this country. In countries such as Malaysia, a credit type card will normally only be available to people of higher socioeconomic status. In this particular case, the mother of the family, the recipient, is able to shop in supermarkets. It is a barcoded system. She cannot purchase, for example, alcohol products, she cannot purchase tobacco related products and she obviously cannot purchase gambling or pornographic material, but she has the dignity of being able to shop for her family using the funds on the card provided to her.

The funding support is for a two-year period, unless the need is demonstrated beyond that. The hope is that that family will be able to re-establish its own financial circumstances. Coming back to the point that I made at the beginning of my contribution, at the same time, in this circumstance where so many people do not have the basic skills, she must commit to participating in basic home budgeting so that she comes to understand and develop the skills associated with this.

It is interesting in the context of the Australian model, which is costing us $150 million, that the entire funding for the MyKasih Foundation is based on philanthropy and philanthropic donations from corporations and individuals, with some now very minor and limited support from the government. In fact, the total cost of the running of the MyKasih Foundation and the software associated with it is actually donated. So those philanthropists who do provide their financial support to this program know that 100 per cent of their contribution goes to the recipient families. It is also interesting that, as an extension of this program—and I think it is one that we could look at in Australia—some of the philanthropic support goes to skills development for the mother and family and associated microfinancing, so that the mother can develops skills. One, for example, that is supported by the Caltex organisation is referred to as 'Sew for Life', where she is given sewing skills. Under the microfinancing program, she can actually purchase a sewing machine and, hopefully, then commence a small home-based business. In the last 12 months—under the previous Indonesian President and carried on by the current President in Indonesia—the MyKasih Foundation has actually started a pilot program in Indonesia as well.

In lending my support to this particular program, I want to make the observation again that it is incumbent on us, in my view, to be able to provide not just the financial support and not just the safety net for those who may need that support. There is an obligation, firstly, to give the skills to people so that into the future they will not be dependent on such funding and not be a victim of an inability to budget and spend in the priority order in which they wish, and ensure, as part of that process, they may be able to move towards gainful employment and, therefore, remove themselves from the need for welfare.

Others have spoken of the other two measures in the bill, which are associated with aged care. Payments have been made to the provider of residential aged care—often for up to a week prior to a resident taking up their residency. I think it is entirely logical that there is no real need for that expenditure to take place. That, of course, is the first point related to aged care. The second one is associated with an advisory service. Again, based on the history now that has been built up, we do not appear to need those Aged Care Planning Advisory Committees.

Further to that, I simply make the observation of Senator Fawcett: in this whole aged care space there is, I believe, an urgent need for good, easy, useable data, so there is the capacity for people not used to the aged care sector to glean information and find out the necessary services available and the restrictions on them. As others in the chamber have no doubt found themselves: most of us in the community know very little, if anything, about the whole structure and management of the aged care sector. In my own case, I knew absolutely nothing about it until my mother suffered a severe stroke. In a very, very limited period of time, I went from knowing nothing to needing to know 100 per cent of all issues associated with aged care. My own experience, and that of my family in assisting my mother in that circumstance, is that there needs to be, in the system, a data collection service, a website and indeed better access to current relevant knowledge so that we can help families and particularly the person who finds themselves in need of such aged care.

I am pleased to lend my support to the elements contained within the Social Services Legislation Amendment (No. 2) Bill. I emphasise again what I believe to be a very, very good measure in terms of income management and income protection.

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

I thank colleagues for their contribution. As colleagues, I am sure, appreciate, schedule 1 is attracting significantly more interest in this place than schedules 2 and 3. But I will speak briefly to each of the schedules.

To ensure that vulnerable people benefiting from income management continue to receive support, the government has committed $146.7 million to extend a streamlined version of income management to all existing locations until 30 June 2017. This will align end dates across all 12 locations across Australia.

The alignment extends to the income management element of Cape York Welfare Reform, which will also continue until 30 June 2017. This will enable income management to continue to provide additional support in disadvantaged locations for vulnerable people, children and families. The government is uniquely positioned, through the provision of welfare and family payments, to use income management to support vulnerable families by assisting them to stabilise and take control of their financial circumstances. This funding also included a limited expansion to new locations which may need additional support and would benefit from the income management program.

In response to a request from the South Australian Premier in the wake of the Chloe Valentine tragedy, on 14 August 2015 Minister Morrison announced that the child protection and voluntary measures of income management will be introduced to the Greater Adelaide region from October 2015.

This bill will streamline the income management program while ensuring continued support to people who benefit from income management. Streamlining includes the removal of social worker assessed referrals through the vulnerable welfare recipient measure, as this was an underutilised tool by social workers and highly resource intensive. The removal of this will also allow social workers to better service their vulnerable clients. While participants remain able to adjust how they use their funds to meet priority needs at any time, they will no longer be required to discuss these arrangements with Centrelink every eight weeks.

There will be a phased removal of the matched savings payment, which offers people on the compulsory measures up to $500 in matched savings if they complete an approved money management course and have demonstrated an appropriate savings pattern over a 13-week period. This will cease from 31 December 2015 as the payment was largely undersubscribed and costly to administer. There will be a phased removal of the voluntary incentive payments, which offer individuals a payment of $250 for every continuous period of 26 weeks. These payments will cease on 28 December 2015, which is the day 26 weeks after 30 June 2015, as evaluations have shown that incentive payments are not the main driver for people commencing income management and that they can create a dependency on the program. The BasicsCard Merchant Approval Framework will also undergo administrative and policy changes that will simplify the model, improve customer experience and remove unnecessary customer contact. The streamlined arrangements will achieve a saving of approximately $36 million over two years.

Schedule 2 relates to ceasing residential care subsidy for pre-entry leave. These amendments formalise the ceasing of payment of residential care subsidy to residential aged-care providers for holding a place open for a care recipient. These changes better target aged-care expenditure by only paying care subsidies on behalf of people who have actually entered permanent residential care. The savings associated with this measure, as stated in the explanatory memorandum, have largely been realised through amendments to the Aged Care (Subsidy, Fees and Payments) Determination 2014 and the Aged Care (Transitional Provisions) (Subsidy and Other Measures) Determination 2014. The amendments in the bill formalise these changes in the principal act. Previously, subsidy for the pre-entry period was paid to providers for up to seven days at the rate of 30 per cent of the full residential care subsidy that would be payable once the care recipient enters care.

Care recipients will still be able to take pre-entry leave prior to entering an aged-care service. The provider will not be able to recoup any lost residential care subsidy from the care recipient. However, the aged-care provider will still be able to charge the care recipient the standard resident contribution for the pre-entry period. Previously, any days taken as pre-entry leave were counted as part of the care recipient's entitlement to 52 days of social leave from the aged-care service. Under these amendments, the 52-day cap on social leave will not include any leave that was taken as pre-entry leave. This ensures any pre-entry leave taken by a care recipient does not negatively impact on their ability to take other forms of leave from the residential care service. The impact of lost pre-entry leave payment revenue should be considered in the context of other recent aged-care changes, such as the redirection of the former government's workforce supplement into the general pool of aged-care funding and the introduction of a higher level of accommodation supplement. The government is expected to provide $11 billion for residential care subsidies in 2015-16.

Schedule 3 relates to aged-care planning advisory committees. On 15 December 2014, as part of the 2014-15 Mid-Year Economic and Fiscal Outlook, the government announced that aged-care planning advisory committees would be abolished, with ongoing functions to be performed by the Department of Social Services. This forms part of the Smaller Government reforms to reduce the size and complexity of government, streamline services and reduce the cost of government administration. The role of aged-care planning advisory committees was to provide advice in relation to the distribution of aged-care places. However, the last of these committees expired in September 2014. These amendments repeal the now redundant relevant provisions in the Aged Care Act 1997. It is important to emphasise that the government remains committed to engaging with stakeholders and obtaining local intelligence as part of the needs-based planning framework. Consequently, the department has consulted with a broad range of aged-care stakeholders to help inform the distribution of aged-care places in relation to the 2015 aged-care approvals round, which was announced on 15 August 2015.

While I am on the subject of aged care, I will observe Senator Polley's demonstration of an aeroplane earlier today when referring to severe behaviour response teams in relation to dementia. She chose an aeronautical analogy to describe those teams and demonstrated a surprising aerial capacity, I think it would be fair to say. I am tempted to go further on that subject, but I can tell by your raised eyebrow, Madam Acting Deputy President Lines, that you fear and suspect that I may be straying from the topic of this bill. But I could not let the opportunity pass without drawing the chamber's attention to that impressive effort on the part of Senator Polley. With those words, I commend this bill to my colleagues.

Sue Lines (WA, Australian Labor Party) Share this | Link to this | Hansard source

The question is that the bill be now read a second time.

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

Given the time, I will not call a division, as I would not be the most popular person in the place. But I would like it recorded very strongly that the Greens opposed the second reading of this bill.

Question agreed to.

Bill read a second time.