Mr RUDDOCK (Minister for Immigration and Multicultural Affairs)(4.46 p.m.) —In relation to the Social Security Legislation Amendment (Youth Allowance) Bill 1997 , I would like to thank all the mem bers who spoke in the debate. While I recognise the two members who have spoken here this afternoon, the debate has been a long one and many have contributed. The non-government speakers in this debate have focused on several specific issues to which I will refer.

Several speakers have suggested that the requirement that a young person aged under 18 must be in education or have finished year 12 to qualify for youth allowance should be omitted from the bill and that those who have not finished year 12 should be able to enter into an activity agreement which would be included in case management.

It is worth reminding the House of Labor's own rhetoric in this area. For instance, the honourable member for Jagajaga (Ms Macklin) told the Age newspaper on 15 November that Labor would recognise the lack of entry level jobs for 16- to 18-year-olds and design policy to support this group to stay in school or training.

The youth allowance provides positive incentives to realise this objective while also making provision for those young people for whom education or training may not be a reasonable requirement. For instance, in cases of illness, the imminent or recent birth of a baby, living in a remote area, recent job loss, inability to secure an appropriate education or training place, caring responsibilities, learning difficulties, major personal crises, homelessness, major disruptions to the home, substance abuse, substantial part-time study and/or workload, having been a refugee prior to claiming youth allowance, being subject to a community service juvenile justice order or some other special circumstance which may include non-employment related case management, youth allowance will be available. Employment case management will continue to be available to young people who are not on youth allowance through FLEX, that is, flexible labour exchange services, from May 1998.

It has also been claimed that the education sector will not be able to cope with the numbers of students who stay on at school or seek education or training places. The government is funding a range of innovative programs to improve education and training opportunities for young Australians, particularly in the area of vocational education and school work experience programs.

Funding has been provided through a number of measures. Firstly, the Australian Student Trainee Foundation has been allocated funding of $9.9 million for each financial year for its core operations, that is, approximately $40 million over four years. The budget also increased funding by $10 million in 1997-98 and each of the following two financial years to support workplace coordinators, that is, $30 million over three years. Secondly, the National Training Authority Ministerial Council agreed in 1996 to provide $80 million over four years—1997 to the year 2000—to state training authorities for allocation to schools for vocational education and training. Thirdly, the school to work program funded for $23 million over the four financial years 1996-97 to l999-2000 promotes effective and reliable pathways from schooling to employment for young people.

The honourable member for Jagajaga expresses concern about the extension of the parent means test under the youth allowance to unemployed customers aged 18 to 20. However, she fails to explain why it is acceptable to means test Austudy recipients but not their peers who may be unemployed. This inconsistent treatment sends the wrong message to young people that they may be better off on the dole than in education or training. For example, in a family on $30,000 per annum with an unemployed child and a student child, both aged over 18, while the student would be paid $111.60 per fortnight, the unemployed sibling would be paid $174.80 per fortnight. That difference of almost $60 a fortnight could be a persuasive argument against taking up education or training opportunities despite the obvious longer term benefits to the young person of doing so.

It has been suggested that the rules for de facto couples should be aligned with those for other social security payments, so that people would not have to have been in the relationship for two years to be considered members of a couple for youth allowance independence purposes. The arrangements for members of de facto couples under youth allowance represent a compromise between arrangements under Austudy and those under other payments under the Social Security Act.

Currently, de facto relationships are not recognised at all in relation to Austudy independence, whereas de facto couples are recognised under the Social Security Act regardless of the length of the relationship, although there is no financial gain for people to present themselves as members of a couple if they are not genuinely in a relationship.

The youth allowance position of recognising relationships of two years duration is a fair compromise which recognises that young people in long-term relationships should be considered independent, without providing an easy means for young people to avoid having their payments parentally means tested. Young people who are in a relationship where one or both are not considered independent—for other reasons—will not be subject to the partner income test.

It has been suggested that the youth allowance should be indexed every six months, in April and September, in line with the arrangements for pensions and other social security allowances. The youth allowance indexation provisions are not in fact contained in this bill at all—they will be introduced in the forthcoming consequential amendment bill—and they therefore cannot be amended now. However, the intention is that indexation will occur once per year only, based on the June CPI, effective on 1 January each year.

This is in line with current arrangements for Austudy. It is also in line with current arrangements for social security allowances for single people aged under 21. Contrary to suggestions that the latter are indexed twice yearly, in fact they are not. Clearly, it would be ludicrous to move to twice-yearly indexation when both major customer groups are currently accustomed to indexation only once a year.

   Question put:

   That the words proposed to be omitted (Mr Latham's amendment) stand part of the question.