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Thursday, 1 December 2005
Page: 38

Mr ANDREWS (Minister for Employment and Workplace Relations and Minister Assisting the Prime Minister for the Public Service) (11:30 AM) —I thank the honourable members who have participated in this debate on the Employment and Workplace Relations Legislation Amendment (Welfare to Work and Other Measures) Bill 2005 and Family and Community Services Legislation Amendment (Welfare to Work) Bill 2005. The government’s $3.6 billion Welfare to Work package recognises that every Australian of working age has the right and deserves the opportunity to participate in Australia’s prosperity. The best way for people to do this is by having a job and engaging in the economic and social life of our nation. At a time of sustained economic growth and unemployment at a 29-year low, it is unacceptable to have 2.6 million people, or 20 per cent of working age Australians, on income support. More than 1.3 million people in receipt of income support have little, if any, participation requirements. It is also unacceptable to have 700,000 children growing up in jobless households, in which many generations of Australians do not know what it is like to have a job, let alone steady employment and a regular income.

No-one denies the fact that a government must preserve a well-targeted social safety net while, at the same time, encouraging working age people to find jobs and remain employed. The welfare reforms demonstrate the government’s strong commitment to this principle. At the same time, people on welfare deserve more support and it is vital for Australia’s continuing prosperity that they be given every assistance and opportunity to achieve better outcomes. To quote the Leader of the Opposition in an interview with Mike Carlton on Radio 2UE on 15 April this year:

There’s no solution to poverty like a job. There’s no question about that.

Moving from welfare to work helps people achieve higher incomes and a better standard of living, participate in mainstream social and economic life and achieve a better future for their families. It also reduces the obligation on taxpayers, creating a positive cycle of work, higher incomes and more sustainable and better targeted welfare expenditure.

Throughout this debate, and indeed for the last 10 years, the Labor Party has been a policy-free zone, opposing reform for the sake of it without providing any alternative ideas. Members on the other side have claimed that people are worse off if they are working. Such claims fail to recognise the importance of a job not only to a person’s financial wellbeing but also to their physical and mental wellbeing. The benefits of having a job far outweigh any costs. As a government and society, we should never find it acceptable to condemn people who have the capacity and the availability to work to a sedentary existence on welfare.

This bill also addresses the very real problem of intergenerational poverty. There is widespread agreement in the literature that the principal cause of poverty is joblessness. It is estimated that just three per cent of households overall suffer hardship, but among unwaged households this is as high as 20 per cent. Children need positive role models in their lives. This includes the 700,000 children growing up in households where no adult of working age has a job. Two-thirds of these households are headed by single parents. The incidence of jobless households in Australia is one of the highest in the OECD. Many OECD countries, including Australia, have experienced rising percentages of jobless households even though employment participation has risen. Young people living with parents on income support are much more likely than average to leave school early and become unemployed or become teenage parents and end up on welfare themselves. Young people whose parents work, even in low-paid jobs, have the benefit of positive role models in their lives and fare much better.

This is not to take away from the important job of being a parent, be it partnered or single. However, these reforms do not ask parents to choose between being a parent and being a worker, which has been suggested by opposition speakers and welfare lobby groups. Rather, these reforms recognise the role of parents and require a parent to seek at least 15 hours work per week once their youngest child is of school age. This is not an unreasonable expectation by community standards.

Throughout this debate claims have been made by the opposition and, indeed, by welfare lobby groups that there are no jobs available for people to move from welfare to work. Australia currently has an unemployment rate of 5.2 per cent as it is experiencing both skilled and unskilled labour shortages. Growth in employment has not just occurred in the cities of Australia. Over the year to October 2005 employment growth has been exceptionally strong in non-metropolitan areas of Australia, up 3.7 per cent compared to 2.8 per cent in metropolitan areas. Strong labour market conditions in regional areas are also reflected in the fact that 61.8 per cent of non-metropolitan areas recorded a fall in their unemployment rate over the year to October 2005, compared to 56.1 per cent in metropolitan areas. The fact is there has never been a better time to work in Australia.

The ageing of the population will result in fewer new entrants to the labour force. If we do nothing to address this issue, then we will see a substantial reduction in the growth of the labour force over the next 10 to 15 years. The MONASH model forecasts published last week predict that the impact of the ageing of the population will result in a shortfall of 195,000 workers in this country by 2010. As a nation we can do nothing and suffer the consequences of an inevitable reduction in our national income and economic growth or we can take action now and ensure that Australia’s economic pie continues to grow and provides an ever-larger share to every Australian. This bill deserves the full support of the parliament and all parties because it will assist many Australians to move from welfare dependency to paid employment. Most importantly, it will give them the opportunity to realise their aspirations for both themselves and their families.

I turn to the related bill that is being debated, the Family and Community Services Legislation Amendment (Welfare to Work) Bill 2005. This bill amends the A New Tax System (Family Assistance) Act 1999 and the A New Tax System (Family Assistance) (Administration) Act 1999. This bill relates to the number of hours of assistance that can be claimed under the child-care benefit provisions. Schedule 1 of the bill increases from 20 to 24 the base limit of the number of hours per week for which child-care benefit may be paid without claimants needing to meet stipulated work, training and study requirements. Increasing the hours from 20 to 24 will assist parents to maintain some level of work force participation and help their transition to a greater level of participation once their children are older. It also recognises that child-care requirements often exceed actual working hours.

Schedule 2 alters the work, study, training or activity test. To be eligible for up to 50 hours of child-care benefit per week for each child in approved child care, parents will be required to demonstrate that they have engaged in work or in work related commitments, training or study activities for at least 15 hours a week and for an average of 15 hours for two consecutive weeks. This measure ensures that the greatest level of support is directed to those families with higher levels of work related participation. It also recognises that there are parents who work a fortnightly rotating roster or irregular hours over a week, so the amendment includes the ability to average hours over two weeks.

The Howard government is providing unprecedented support to Australian families with child care. The government has doubled funding for child care compared to Labor. The projected expenditure is $9.5 billion over four years to 2008-09. In fact, the Howard government announced more outside school hours care places—over 84,000—in the last budget than Labor had in total in their last year in government; that was just 72,000. If you recall, Labor announced a mere 8,000 places. The then shadow minister for children and youth said of Labor’s child-care policy:

It is not many places; it certainly is a drop in the ocean.

Under the Howard government, families are now receiving on average over $2,000 per year in child-care benefit. We have also introduced the 30 per cent child-care tax rebate. Parents may be eligible for up to $4,000 per child per year for out of pocket child-care expenses. We must not forget that the reality is that under Labor child-care fees grew at twice the rate and that there were only 72,000 outside school hours care places.

Ms Macklin interjecting

Mr ANDREWS —I hear the interjection by the Deputy Leader of the Opposition. I remind her that under the Labor Party there were only 72,000 outside school hours care places; there are now 285,000 places. The figures speak for themselves. And still the Labor Party has no child-care plan! The reality is that this government is getting on, doing the job and putting in place legislation that will encourage more Australians off welfare and into a job, because we fundamentally believe that the best form of welfare is a job. I commend the bill to the House.

Question put:

That the words proposed to be omitted (Ms Macklin’s amendment) stand part of the question.