Mr ANTHONY (Minister for Children and Youth Affairs) (1:41 PM) —I am very happy to be here on behalf of the Minister for Family and Community Services. I thank members for their contributions, although the member for Charlton, while she spoke to some points of the bill, spoke on many bills which are not relevant to this piece of legislation. I thank in particular the member for Blair for his excellent contribution and I thank others who spoke in the chamber—although many of the speeches that we heard from the opposition members included the tired old objections that we heard from the Labor Party when we tried to put this bill through the Senate last year.

Certainly there is no intent to hide the Family and Community Services Legislation Amendment (Disability Reform) Bill (No. 2) 2002 [No. 2]. We have been very up-front and we will continue to be so, because we believe that it is in the best interests of people with disabilities, particularly those people on disability support pensions, to focus on their abilities rather than their disabilities to give them the maximum possible chance to participate in the work force, rather than languishing for years on a disability support pension—which is not in their long--term interests. That is why this government is absolutely committed to and is serious about trying to improve the status of and outcomes for people with disabilities.

Spending many years on income support is not the best outcome for a person who can play an active role in society. As we all know, many people with disabilities want to work and earn real wages. People with disabilities in the sector have been telling me and the government that they want more opportunities to participate. The changes made to the criteria for disability support pensions by schedule 1 of this bill will ensure that people with disabilities are actively encouraged and assisted to take up part-time jobs or other activities, consistent with their capacities, that will facilitate the transition—an important transition—from welfare to work.

Recent research suggests that, with assistance, up to half of the people on DSP have the potential to work 15 hours or more per week. The bill will support the necessary changes to ensure the sustainability of DSP for those with a limited capacity to participate. The current structures are not sustainable, and we all know that. DSP numbers have more than doubled over the last 10 years and are increasing exponentially. If left unchecked, the spiralling growth in the number of people on DSP will result in a significant increase in the number of Australians who lose their connection to the work force. This number is currently around 660,000. If we do not do anything, by the year 2010 it will be 810,000 and climbing. More spent on DSP over time actually means less money available for the critical services and supports that could really make a difference for a person with a disability and could help them to participate.

There is a broad acceptance within the disability sector that the current system is unsustainable and that the focus should be on supporting people who are least able to support themselves. Current income support rules effectively enable people with a disability to withdraw from the labour market by drawing distinctions between those who are considered to have the capacity to work full time and those who are not. Once they are on DSP, 77 per cent of people stay on DSP for the rest of their working life, and less than 10 per cent of people on DSP have earnings from employment. A recent OECD report stated that, in Australia, the personal income of people with disabilities is 44 per cent lower than the personal income of people without disabilities. The best way to fix this is to actively encourage those who have some capacity to work to make the most of their ability and the opportunities available.

The strong focus of the McClure report is to shift towards a focus on ability rather than inability. The report also recommended that the government realign the 30-hour work capacity threshold test with the current working patterns, and this measure takes that step. The new 15-hour work capacity threshold reflects the expectations of the government and the community that people will take up work available, including part-time and casual positions, in the labour market. The government has been prepared to compromise and has listened to the concerns of the community. It is encouraging to hear that there are many individuals, groups, people with disabilities and their representatives who agree that DSP should be for people who need it most. Through encouraging and supporting individuals to be more active, we hope to open new doors for people with disabilities in employment and activities within their communities.

About 13 per cent of people on Newstart and Youth Allowance—around 87,300 people—have a disability. Many of these people participate in activities and programs to help them address barriers related to their disability and to improve their employment prospects. That is why we have maintained our commitment to create up to 73,000 places in employment assistance, in rehabilitation, in vocational education and in training: to help people with disabilities who are affected by the changes to move into work or to be active within their own communities.

Australians Working Together, which was introduced in September 2002, focuses on the ability, through better assessment of work capacity and identification of key barriers to participation, to provide that strong foundation for change. With the extra places announced under AWT and the places in disability employment assistance, that will increase by over 50 per cent—and nearly 80 per cent for those people in rehabilitation. The substantial investment will support the strong focus on participation. This is not a crackdown on DSP recipients, nor is it a cost-cutting exercise. The grandfathering arrangements made under this bill will protect people receiving DSP prior to 1 July 2003. Of course, the most vulnerable people with a disability—those who cannot work 15 hours or more per week at award wages—will not be affected.

The changes under this bill will not apply to people already receiving DSP or those who apply before 1 July 2003. There will also be no change to the arrangements for people who are permanently blind. The new rules will apply only to people who claim DSP after 1 July 2003. These changes mean that people with substantial work capacity will not be eligible for DSP. People will have greater access to services and financial assistance to help them meet the costs of participation through payments such as the mobility allowance, the language, literacy and numeracy supplements and the employment education entry payment. The government is committed to welfare reform. While the ALP have turned their back on these people—those at risk of welfare dependency—we are committed to tackling the hard issues and pursuing reform.

The OECD recently recognised in their report on Australia that the government is on the right track. In fact, the report is full of praise and provides support for the government's efforts to have the disability reform bill passed by the Senate. The report says:

That is from page 10 of the report.

Mr Swan —Who was the author of that?

Mr ANTHONY —The OECD. I ask the question: if the rest of the world can recognise that the government is seeking to do the right thing to ensure people do not languish on DSP, why can't the opposition? If the OECD recognises it, and if most of the participants recognise it, why can't the opposition?

Mr ANTHONY —The answer is simple. The member for Lilley interjects. They are committed to opposition for opposition's sake. However, some members of the opposition have recognised that change is needed. I would like to quote someone who is never fearful of expressing his opinion—the member for Werriwa. He said:

That was on 26 July 1999. Even the member for Lilley, as part of his submission on welfare reform a few years ago, said:

This is the conundrum that the opposition find themselves facing. They privately argue for welfare reform—and other members do—but when it gets to the Senate, or even to this chamber, they say one thing and do another. This is hypocrisy at its greatest.

This bill seeks changes to improve the work capacity of people with disabilities and it assists them to participate to their full potential. The government oppose all the ALP amendments to this bill. We hope that, when the bill does get to the Senate, there is due consideration given—preferably by the Labor Party but also by the minor parties—to ensuring that this bill passes through the Senate so that we will have a proper structure to help people with disabilities through increased funding to literacy, numeracy, rehabilitation and vocational education services. It is all about focusing on people's ability rather than on their disability. It is all about ensuring that people on DSP are not left to languish and to be forgotten until they reach pensionable age. The government are fully behind this bill. We oppose the ALP amendments and we hope that we can get support in the Senate at a later date.

Question put: