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Wednesday, 3 September 2014
Page: 6311

Senator XENOPHON (South Australia) (11:20): What a relief it is to hear Senator Lazarus not say, 'This is not my first speech'! I am sure Senator Lambie will be relieved not to have to say that after her first speech later today, and I wish her well in respect of that.

I will speak to this bill and say that I cannot support it. I will outline those reasons, but I think it is fair to say, after Senator Lazarus outlined his party's position very well, that—insofar as this bill relates to the job market in the sense that, if the job market is contracted, it does make a difference as senator Lazarus has said—I am concerned that yesterday with the mining tax repeal there were also repealed benefits to small businesses in terms of accelerated write-offs. I did a media conference not so long ago with Peter Strong, the COO, of the Council of Small Business of Australia, and he had genuine concerns about the chaos that will cause and confusion for small businesses, some who have claimed the write-off, thinking they could, and now will have to pay that back or really plan differently because it has disrupted their business plan. If you accept that one of the biggest drivers of employment growth in this country is the small business sector then that is something that is a real concern. That is the problem when you rush legislation through.

I am not having a go at Senator Lazarus, whom I have a lot of regard for.

Senator Lazarus: Sounds like it to me.

Senator XENOPHON: No, I am saying that, if you rush things through and do not have appropriate debate—and it happened in the previous parliament with the ALP government and the Greens with the gag on many occasions—you end up with some lousy policy outcomes. I direct this to the Liberal Party of Australia. Their great founder, Sir Robert Menzies, back in 1942 spoke of the 'forgotten people', including the small businesses of this country. I think that small business in the 21st century Liberal Party have been forgotten by this government with the changes that were announced yesterday. I say that with more sorrow than anger. I also direct it to the Leader of the Government in the Senate, Senator Abetz, who I do have a lot of regard for.

Let us go to the Social Security Legislation Amendment (Stronger Penalties for Serious Failures) Bill 2014. Serious failures can occur when a job seeker refuses a suitable job offer without a valid reason or consistently fails to comply with participation or activity requirements. The penalty is an eight-week non-payment period. These are penalties that the former government put in place. Under the current law that was introduced under the Rudd-Gillard-Rudd governments there is an option to undertake a participation requirement, similar to work experience, instead of the non-payment penalty. Under the current law the secretary of the department has the discretion to waive the penalty in certain circumstances—for example, if it causes severe financial hardship or if the person is unable to undertake the participation option. This bill removes that discretion where a job seeker has refused or failed to accept an offer of suitable employment. The bill also removes further discretion where the secretary may end the eight-week non-payment penalty early. That is also the case where there has been compliance. For whatever reason, if a person shows compliance then there can be that discretion exercised by the secretary.

The government also introduced regulations relating to the matters that the secretary must consider when determining whether or not a job seeker has a reasonable excuse for failing to meet the participation requirements. We are talking about a reasonable excuse. This was disallowed by the Senate last week, and I supported that, but as it stood, the instrument meant that the secretary would no longer need to consider: firstly, that the person did not have access to safe, secure and adequate housing or that they were using emergency or shelter accommodation; secondly, the literacy and language skills of the person; thirdly, that the person was subject to criminal violence, including domestic violence; fourthly, that the person was affected by the death of a close family member at the time; and, fifthly, if the person had previously been released from prison. That is why I commend the work of Senator Rachel Siewert in her advocacy in relation to this and that is why I supported Senator Cameron's motion to disallow, and that is why I voted with the Palmer United Party because it was the right thing to do in that context.

Research from the Social Policy Research Centre, SPRC, indicates that the eight-week non-payment period is more likely to impact on people who are already struggling. The financial strain could seriously affect access to safe and secure housing. Data from the Department of Education, Employment and Workplace Relations in 2008 shows that approximately 15 per cent of people who were subject to the non-payment lost their accommodation. A further 50 per cent of people experienced difficulty in paying their rent and were put at risk of homelessness. While there needs to be compliance measures in place for those who genuinely are not doing the right thing and are not making an effort to find work, people should still be treated humanely and with dignity and respect. There are serious concerns that this measure in this bill will have a harmful impact on people who are already struggling. My fear—and I think it was reflected in the comments made by Senator Lazarus—is that if this bill is passed it will drive more people into crime and violence in order to survive. That is not what I think we should be doing as a society. The impact of the non-payment period may also establish a vicious cycle where job seekers are penalised and, being in such a bad financial position, they will be more vulnerable to further breaches. There is no case for changing the current system. If there is a case, it is certainly not in this way.

Senator Lazarus touched on the issue of jobs in regional Queensland. Guess what, Senator Lazarus, not only do I agree with you but there are also problems in the suburbs of Adelaide with employment because of the decision that was made by General Motors Holden to leave manufacturing towards the end of 2017. This will have a huge impact on the automotive supply chain not only in South Australia but also in Victoria. There are 33,000 direct jobs in the automotive component sector and another 12,000 or so in the original automotive manufacturers, who will all be sadly and tragically departing by the end of 2017. There are other tiers of that sector. There is a significant multiplier effect. It is estimated that there are upwards of 150,00 to 200,000 jobs that rely on that sector. There will be a potential catastrophic collapse of employment in South Australia and in Victoria if we do not ensure that there is appropriate transition funding.

I have worked on this with Senator Ricky Muir, Senator John Madigan and Senator Di Natale from the Australian Greens. We need to ensure that the Automotive Transformation Scheme and the funding that was butchered—effectively $900 million and, in particular, $500 million over the next three critical calendar years—is maintained. We need to ensure that the criteria for that funding is altered so that it gives real hope for manufacturing. We are not talking about corporate welfare; we are talking about letting those businesses transition to other businesses like the mining sector, in the renewable energy space, or even locally build a car from another country where it could be assembled here or from the ground up. I have been speaking to people about that in my home state and interstate. We need to ensure that that funding is in place. The dairy industry was provided with significant funding to transition as a result of the deregulation a number of years ago and this is a similar concept.

I must say, the statement made by the Treasurer, Mr Hockey, last year when he effectively taunted Holden, 'Are you going to stay or are you going to go?' I just found reckless and irresponsible. I say that with great sadness because I have a lot of time for Mr Hockey on a personal level, but I think that statement was reckless and irresponsible. It was basically giving the finger to General Motors' headquarters in Detroit and there is going to be a huge chasm that needs to be filled in terms of those jobs.

We need to consider this piece of legislation in the context of a weakening job market. Our manufacturing sector is collapsing. Our farming sector is struggling for a whole range of reasons. Senator Lazarus touched on that yesterday—food labelling laws, the duopoly and a whole range of other measures. I heard today that Coles is retrenching several hundred people, and that is sad. I criticise Coles for their market share and some of their practices but they are a significant employer and, from speaking to people, they are a good employer, as is Woolworths. My complaint is not with the people who run Coles; my complaint is with their level of market share and the consequences that flow from that.

I cannot support this legislation, particularly in the context of a weakening job market. If there is another way to deal with those who genuinely are not seeking employment, we should do that. Having said that, you, Mr Acting Deputy President Sterle, and others in the labour movement have spent a lot of effort and energy attacking me on the issue of penalty rates. I will not apologise for my position. I believe that if you want to stimulate employment in this country and open up the job market then you are not exploiting young people if you limit the casual loading rate to, say, 25 per cent on weekends. Many businesses across this country are shut on weekends and have cut back their hours because it is not economical for their survival. I defy anyone to say that a small business with 20 employees or fewer is exploiting casual workers who get 25 per cent above the award on the weekend. Those businesses make up the backbone of jobs in this country. That is a debate we need to have.

All around your wonderful home state of Western Australia, Mr Acting Deputy President Sterle, there are tourism areas that cannot be open on weekends because of penalty rates. Destroying those job opportunities does not make any sense. Unlike Senator Day—and I wish him well with his real first speech today—I do not support reducing the minimum wage. I support the award system, but I do not support the current system of penalty rates, which has been a job killer for young people and a heavy burden on small businesses across this country. That is something that needs to be considered in the context of the employment market in this nation.