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Wednesday, 25 September 2002
Page: 4886

Senator HUTCHINS (4:44 PM) —I present the report of the Community Affairs References Committee on the Family and Community Services Legislation Amendment (Australians Working Together and other 2001 Budget Measures) Bill 2002 and related issues, together with the Hansard record of proceedings and submissions received by the committee.

Ordered that the report be printed.

Senator HUTCHINS —I move:

That the Senate take note of the report.

The Senate Community Affairs References Committee was asked to inquire into the adequacy, effectiveness and fairness of the proposed participation requirements for parents and mature age unemployed Australians as contained in the Family and Community Services Legislation Amendment (Australians Working Together and Other 2001 Budget Measures) Bill 2002. The committee was also asked to consider the report of the Independent Review of Breaches and Penalties in the Social Security System, also known as the Pearce review. I would like to thank the members of the committee and the staff for their diligence and commitment to the process.

The Pearce review presents a balanced and sensible approach to the issues of participation requirements and breaching. In our view, the Pearce approach represents a way forward both in terms of this legislation and the reform of the penalties regime more broadly. Currently, the legislation does not accurately reflect the reciprocal nature of the principles of mutual obligation. The phrase `mutual obligation' implies that there are two groups who are obliged to take action. In the relationship between government and the individual, the government is the stronger, more experienced and more powerful partner. As such, it has a greater responsibility than the individual concerned.

The so-called Australians Working Together package and the McClure report on which it was based spent a great deal of time discussing the concept of community involvement in the process of engaging people in work. But the proof is in the pudding. While the government vaunted the importance of the community, individuals and government working together, its package failed to deliver. In the $1.7 billion package, many hundreds of millions of which simply extend existing programs, a measly $22 million is to be spent on community engagement. Of that $22 million, the vast majority is to be spent on the Prime Minister's Community Business Partnership, which has scope of myopic proportions. For a government that has mutual obligation at the heart of its agenda for the welfare system, that is a pretty poor commitment. Members of the government such as Minister Abbott would love to shift the burden of welfare to charities and the community. But that will just not happen. If it is a workable proposition, a major cultural change will need to occur. At the moment, the government is not willing to commit to what is necessary for that change to happen. Instead, it has proposed changes to the social security system which punish the most vulnerable members of our society.

The government has clearly not thought through the costs of being subject to a participation agreement. The government's payment of $20.80 per fortnight, which would offset the additional costs incurred as a result of complying with a participation agreement, is grossly inadequate. Conservative estimates provided to the committee by witnesses suggested that this figure should be doubled if it were to adequately reflect the type of expenses that people incur. The breaching system is punitive by its very nature and there would be few senators in this chamber who disagree with the principle that one should participate in the job market if one is a recipient of a Centrelink payment such as Newstart or Youth Allowance. They are, after all, payments which are paid in return for job seeking, training or education.

The Senate Community Affairs References Committee, however, was entrusted with an inquiry into the effect that participation requirements and breaching would have on single parents and older unemployed people. Single parents are a group in society that is often targeted by conservative commentators as undeserving of the supposed privileges it is given by the Australian social security system. During the inquiry the committee heard evidence from a number of groups that showed how difficult life is for single parents. They told us of the commitment that single parents have to their children and the high priority they give to caring for them. The Sole Parents Union made particular reference to the importance of a balance between work and family. Single parents are not unemployed; they are engaged in caring for their children. Nor are they welfare bludgers—they are, in fact, the group of welfare recipients most likely to be engaged in work.

Most of us here are parents and we understand the demands that our children place on our time. Those demands are not unpleasant, but they exist. I doubt that there is anything more important than the caring and responsible upbringing of our children. Separated and divorced parents may well be to blame for their own actions, but the imposition of unreasonable participation requirements on single parents punishes children as much as it does their parents. The family is the most basic element of our society. Where it fails, we are obliged to ensure that it does not also fail the next generation.

With respect to the provisions within the bill for the mature age unemployed, simply not enough is done. If there is a group which has suffered at the hands of the government, it is the older unemployed. While enforcing compulsory participation agreements on single parents, the bill that the committee reviewed allows older unemployed people greater flexibility. While there is flexibility, the sense one gets is that these are people that the government has given up on. These are the people who most need to be retrained and taught new skills. Yet the government's package provides them with no new opportunities and no hope. They are parked and essentially left to wait for the old age pension to kick in.

Mutual obligation, if it were used effectively, could be part of a targeted reduction in welfare dependency. The point is that participation agreements should have an aim, and that aim should be to get people jobs. Almost everyone who receives a Centrelink benefit would jump at any opportunity they were given. But, instead of being a tool of training and a means of increasing the employability of our work force, the government uses participation agreements as a way of deceiving the electorate and cutting costs to the tune of tens of millions of dollars.

Under the proposed model of breaches, single parents would stand to lose $987 for missing one interview. By the third breach, a parent and their children would suffer a $3,990 decrease in their standard of living over a period of 14 months. The aim of participation requirements should be to assist individuals in taking part in the work force. Penalties of this order would appear to be counterproductive. The government should not ignore the impact of such pay cuts on the lives and opportunities of a single parent's children. The government may not sympathise with the children of single parents, but the public does. In a survey conducted by the Brotherhood of St Laurence, members of the public suggested that a fair breaching program would be $20 for the first breach, $50 for the second and $75 for the third. The government's proposal is some 27 times greater than what the public considers to be punishment enough.

The parenting payment is not something that benefits the parent only, it also benefits their children. Submissions to the committee made it very clear that parents would consider their responsibility for the welfare of their children more important than the fulfilment of obligations under a participation agreement. When a system makes a parent choose between his or her children and financial benefits, there is something very seriously wrong. I would certainly not call myself a bleeding heart. In fact, there are a few members of this chamber whom I have accused of being bleeding hearts in a very derogatory sense. But I do believe in the principle of a fair go. I do believe that if the government is going to make life hard for people, there has to be a good reason. I also believe that the government's proposed changes to the social security system are mutton dressed up as lamb.

Our current system of breaching is arbitrary in its punishment of individuals for failing to comply with participation agreements, it is out of step with the public's perception of how people should be treated, it is counterproductive in terms of slowing welfare dependency and the government has opted out of its side of the bargain. The overwhelming decision of the committee was to endorse a sensible and effective program of participation requirements to ensure that Australians are given a chance rather than being arbitrarily punished.