Mr RUDDOCK (Minister for Immigration and Multicultural Affairs)(4.27 p.m.) —Mr Deputy Speaker—

Opposition members interjecting—

Mr RUDDOCK —I am surprised that those who are so vocal want to leave so quickly. I welcomed the first couple of sentences of the speech of the honourable member for Jagajaga (Ms Macklin). I thought it may have been a reasonable discussion of the matters that are before us. She indicated that she did not want to be seen as carping and negative in relation to this matter. There were some positive aspects to it. Then she proceeded to give a very negative speech.

Ms Macklin —Put the balance in.

Mr RUDDOCK —I will spend some time just pointing out those who do gain. That is the balance. But it is important to first deal with one or two inaccuracies that were con cluded in the speech of the honourable member.

The first point I thought she was trying to make about the way in which this issue was being dealt with was that there was some manipulation of employment statistics by this measure. Let me make it very clear: there is no manipulation of the sort that the Labor Party was familiar with when they were in office. They were about the manipulation of these figures by churning people in and out of programs over a long period of time.

Mr Willis —Oh, rubbish!

Mr RUDDOCK —That was the way in which it operated. The fact is that, if people are unemployed, the Australian Bureau of Census and Statistics will be counting them. We are not in any way altering the basis upon which those statistics are kept.

Ms Macklin —How can you be unemployed?

Mr RUDDOCK —There is the basis upon which the statistics are kept. If a person is surveyed and found to be unemployed, they will be detailed as unemployed. There is no manipulation of the statistics.

We are about meaningful change, and what needs to be understood is what this measure has undertaken. This measure ensures that from 1 July we will have a single youth allowance which will provide income support to young people, including students, those who are looking for work and those who are sick. It replaces five different program payments which are in place now: Austudy for 16- to 24-year-olds and certain 15-year-olds, newstart allowance for 16- to 20-year-olds and certain 15-year-olds, a new training allowance for 16- to 17-year-olds and certain 15-year-olds, the sickness allowance for 16- to 20-year-olds and certain 15-year-olds, and the more than minimum rate family payment for secondary students aged 16 to 18 not obtaining Austudy.

This was the range of payments which had been severely criticised and I think constitute the very reason why the Brotherhood of St Laurence, in its statement today, says:

The Brotherhood of St Laurence has welcomed the news that young people forced to live away from their families would be better supported to stay at school or in training under the new Youth Allowance.

The Executive Director of the Brotherhood, Bishop Michael Challen, said `We have been asking for better support for this group of young people for years, and finally their need is starting to be recognised.'

`Homeless young people are often forced to drop out of school or training simply because the financial pressures are too great. The 16 and 17 year olds who come to our services have to meet the same costs as other young people living independently. The extra $12 a week is much needed.'

Other positive aspects of the allowance that are noted by them are:

allow young people to undertake more complicated mixes of work, training and study without loss of payments;

reduce some of the apparent disincentives to study;

and better assist students in meeting their housing costs.

Ms Macklin —I said that.

Mr RUDDOCK —I think you picked up the items that were mentioned by them, but let me just go through and deal with the further matters that are involved. It is important to note that this is not a savings measure. You would think, from the speech of the honourable member for Jagajaga (Ms Macklin), that we were about reducing government expenditure by these changes. What we have done is to introduce a youth allowance in which the government is helping young people by making income support arrangements simpler and more flexible. We have reduced the five payments to one and 13 different rates of payment to five. Customers will no longer be cancelled and have to reclaim different payments for minor changes in circumstances. It will be more effective in responding to the changing labour market by taking into account the full range of training and employment activities available for young people.

The youth allowance removes the disincentive to study caused by differences in income support arrangements for young people under 21 years of age. For younger students in particular, it creates a real incentive to complete year 12 or the equivalent qualification before they look for work. It reinforces the government's message that families should support young people until they have achieved financial independence. It provides more assistance to young people who need to live away from home to study or to look for work, especially those from rural areas. As I mentioned in question time there are numbers of people who gain very significantly—

Ms Macklin —And losers; mention them.

Mr RUDDOCK —What is important to note in relation to this matter is that most people will not be facing changed circumstances and over 100,000 people benefit as a result of the changes that are made.

For full-time students, currently Austudy recipients: around 70 per cent of the youth allowance population will gain. Seventy per cent of students who have to live away from home will qualify for rent assistance. Seventeen thousand students will benefit from a more lenient, independent assessment criteria than is now applied under Austudy.  Forty-one thousand will gain from abolition of the minimum entitlement of over $1,000 per annum.

Young people aged under 18 years living away from home will receive a higher rate of payment and rent assistance would be available. This would include young people who are exempt from the requirement to be in full-time study or training. All students will now have access to the $500 loan advance currently available under newstart.

These are very significant and very beneficial changes which, in overall effect, leave the vast majority of young people—378,000—unaffected, and 137,000 better off. If we look at those who are receiving reduced amounts, the numbers pale into insignificance in comparison.

This is the situation. If young people are not able to access other forms of education—some comments were made about the extent to which educational opportunities may be available—if it is shown that those opportunities are not available, the young people will still be able to continue to access the range of benefits. Without even questioning whether or not the honourable member is right in relation to the allegations that she makes—

Ms Macklin —Which allegations?

Mr RUDDOCK —The allegations against the Minister for Schools, Vocational Education and Training (Dr Kemp) and his comments about what is happening in relation to TAFE. We do not accept the assertions you make. There are additional funds available to create, over the next several years, 100,000 additional places per year; and that point has been made by the minister. There are the additional places that will be available through the arrangements in relation to the apprenticeship regime that is being put in place.

This government's highest priority is to provide young people with jobs. We have made that point. The youth allowance is designed to achieve this by changing the incentives to make it more attractive for young people to study rather than just obtain unemployment benefits.

As I mentioned earlier in the day, early school leavers are three times more likely to be unemployed as a result of having left school earlier, and that is an important matter. The Labor Party is opposing incentives for young people to improve their skills.

Mr Quick —It is not true.

Mr RUDDOCK —That is what it is about when you suggest that these matters ought to be brought into question. The point that I have been making in relation to these matters is that they obtain very substantial benefits—something that the Labor Party could not deliver. But it needed to be part of a holistic approach to reviewing the system.

Ms Macklin —Bring a stick along.

Mr RUDDOCK —You would not be able to get the benefits that we are proposing unless you were prepared to make the changes in relation to the way in which this system operates. What we are doing is not a stick; it is changing the incentives. And the incentives at the moment are for people to opt out of school, to go and sit on the beach and to receive unemployment benefits which are intended for those who are genuinely unemployed.

The honourable member for Jagajaga, in her comments, was endeavouring to suggest that this government in some way was not inter ested in families. Let me make it very clear that this government is interested in families and we have put a great deal of emphasis on assisting families. If you look at the last budget, our family tax initiative will allow eligible families—including couples and single-parent families—to receive a $1,000 additional increase in the tax-free threshold for each dependent child aged under 18 years. Families with one child are eligible if their income is up to $70,000. With each extra dependent child under 18, the income limit rises by $3,000. In short, a typical single-income family with three kids, of whom one is under five, will be better off by over $1,100 a year than they were under Labor.

If you look at the range of other programs in which the government has been involved, you will find that they are about supporting families. This contrasts with the sorts of speeches I was making in this House while Labor was in office when the rich got richer and the poor got poorer and when families went backwards. That was the outcome under the former government.

We have studies which demonstrate that that was the case. We have had the Henderson work on welfare and inequality, the Social Policy Research Centre work by Henderson and Jensen, the OECD study on social and economic inequalities and the National Centre for Social and Economic Modelling. All of these studies that came out between 1993 and 1995 focused on the Labor Party's period of tenure and found increasing inequality of income between the poorest and richest Australians.

This work is confirmed by Professor Gregory of the Australian National University, who analysed data from 1976 to 1991. That is largely the period in which the former government had been in office. He found that, in that time, the richer suburbs' household incomes had increased by 23 per cent and the poorer suburbs' household incomes had fallen by 23 per cent.

This was the neglect that we saw under the former government. This government has been about redressing those matters. We have had positive changes in a wide range of areas. It is not a bandaid approach; it is a holistic approach focusing on the problems and not trying to simply cure them in the way in which the former Labor Party sought to do so.

This government is taking a broader view. We have seen a range of areas in which changes have occurred which impact directly on supporting and maintaining families. There is the youth homeless pilot project, the parenting education program, youth activity services and the national youth suicide prevention program. I could spend time going through each of those, outlining them in a very positive way, but I think in the context of this debate it is important that I take the opportunity to reiterate what it is that we are talking about.

This is a very significant change that we have announced. The Labor Party was asked to focus on—and I was on committees when it was asked this over and over again—a situation where you would have a single payment with a similar range of payments for people, whether they were in the social security system or the education system.

Mr Quick —That is fine, but—

Mr RUDDOCK —The honourable member says, `That is fine.' It was not so fine that the Labor Party in office could find a way of achieving it.

Ms Macklin —You want to throw people off.

Mr RUDDOCK —The Labor Party were not prepared to put in place a balanced program. They preferred to have young people on unemployment benefits not accessing employment, not being able to get available jobs, and simply languishing because of that situation.

Ms Macklin —You have not improved unemployment one jot, not one bit.

Mr RUDDOCK —What we have is a situation now where the overall question that needs to be looked at and which—

Ms Macklin —Have you done anything for youth unemployment?

Mr RUDDOCK —Yes, we have. We are dealing with the circumstances in which these young people will have better and enhanced opportunities in the future. We have a situa tion in which they will be able to upgrade their skills through the school system and through the vocational employment opportunities that do exist here in Australia and which will be expanded under this government. It will operate within a simpler, more effective system in which the benefits and the way in which they are paid will not discourage people from using those opportunities.

The fact is that, under the Labor Party, you had a range of social security opportunities for which there were no educational benefits attached available, which simply encouraged people to opt out of the system. It was the worst possible outcome. It is something that was totally indefensible. I am very surprised that members opposite whom I know well and greatly admire on a personal basis are prepared to attack these very positive measures. (Time expired)