House debates

Tuesday, 24 June 2014


Social Services and Other Legislation Amendment (2014 Budget Measures No. 1) Bill 2014, Social Services and Other Legislation Amendment (2014 Budget Measures No. 2) Bill 2014; Second Reading

6:42 pm

Photo of Brendan O'ConnorBrendan O'Connor (Gorton, Australian Labor Party, Shadow Minister for Employment and Workplace Relations) Share this | Hansard source

I rise to oppose the Social Services and Other Legislation Amendment (2014 Budget Measures No. 1) Bill 2014 and the Social Services and Other Legislation Amendment (2014 Budget Measures No. 2) Bill 2014 for a variety of reasons. Before I go to the more substantive contribution I want to make, I want to associate myself with the member for Mallee and his concern about the proposition that by 2035 people should not receive the pension until the age of 70. I think the member for Mallee made a very compelling argument against the proposition that has been put forward by the government in relation to the retirement age. In particular he is concerned that people who work in manual labour and people who work in physically difficult circumstances will have great difficulty working until the age of 70. As we stand now, everybody under the age of 50 will have to wait until they are 70 to receive the pension. I think the government is being wrongheaded. It is harsh. It would place us in a position unequalled in the world. No other country has embarked upon such a radical proposition.

The previous government's move to the age of 67, which I think will also be a tough challenge, was as a result of a comprehensive review into Australia's pension system and a significant improvement to the base rate for the pension and improvements to indexation. This government's proposition—that the age of 70 be the point where a person will be entitled to the age pension by 2035—has had no proper examination. There has been no proper consultation. There has been no rigorous review at all. It really is an example of the lack of regard and the lack of consideration by this government for the many measures in these bills.

I daresay that not only does the member for Mallee have some concerns about that proposition but I did not hear him advance an argument in favour of any of the measures in these bills. He may vote for it but I did not hear him at all support any of the measures. You probably can understand why, Deputy Speaker, when you read the bills. This proposed legislation seeks to write into law Tony Abbott's cruel and callous budget. These bills taken together will leave millions of Australians worse off. They include the measure to index pensions by CPI instead of wages—an attack, I would contend, on 3.2 million Australian age pensioners, disability support pensioners, carers and single parents. It may suit the Prime Minister in question time to continue to disregard the truth when questions are put to him, but the facts are that as a result of this measure we will see pensioners in this country within 10 years lose $80 off their pension, $80 off their household budget, a budget already stretched for the majority of pensioners in this country. It really underlines the cruelty of the government and how out of touch the Prime Minister, the Treasurer, the Minister for Social Services and the entire cabinet and government MPs are. I do suspect, however, that those members who go back to their electorates, like the member for Mallee, are a little more sensitive to the concerns that are shared by those who will be directly affected. These measures also include a cut to the family tax benefit part B when a child turns six, an attack upon 600,000 single parents and single income families. They include measures to abolish the seniors supplement, a further attack on senior Australians.

There are many harsh measures in this budget and I would argue that one of the worst measures, one of the harshest measures, will be the cuts to young job seekers' income. These proposed measures will cut young job seekers off Newstart for six months. It will not matter that those job seekers look for work each day, each week, each month for six months, they will receive nothing in support from this government. It also leaves job seekers aged between 22 and 24 worse off by around $48 a week as they get moved from Newstart to youth allowance. That is a fall of about 18 per cent of their income, $2,496. We can compare that with a person who has an income of $200,000 and is being asked to pay a temporary levy—let us say what it is, a tax—of two per cent after $180,000 earned. That person will be paying $400 a year, 0.2 per cent of their income, and the person that is going from Newstart to youth allowance will be paying almost 20 per cent of their income. That is a 100-fold difference in terms of the proportion of the Newstart person's income that will be lost as opposed to the person on $200,000. So I cannot accept the view put by the government that this is about people sharing the burden, when you have people living below the poverty line who may be losing up to 20 per cent of their income. As the member for Jagajaga said, this is an attack on a generation of young people looking for work, and Labor will fight this legislation.

The whole premise of this budget, indeed the whole premise of the measures contained within these bills, is based on two lies. The first is that we are in a budget emergency, and I will deal with that. The fact is that we are not in a budget emergency. We have relatively low unemployment, although that is a challenge and will be an ongoing challenge. We have low interest rates. Our economy is in a good state and was left in a good state by the previous government. Indeed, since the global financial crisis it has grown as an economy faster than almost any other developed nation. As a result, the current government inherited a good economic situation. Yet the government's measures are predicated on the notion that there is a budget emergency so that they could effectively slaughter the incomes of pensioners and job seekers and sick people and the like. If there really was a budget emergency, and I am happy to hear the arguments as to why one would suggest there is, then why is it that the government will be proceeding with a $22 billion plan to give $50,000 to wealthy families to have a baby? This measure really does expose the deceit of the government to suggest there is a budget or fiscal emergency. That $22,000 million that would be expended is not only inequitable, it is a very unfair measure, particularly in light of the cruel cuts that are contained within these bills.

The second falsehood, and the member for Jagajaga in her contribution went to this, is that Australia's welfare spending is out of control. That also is not true. You can always find better ways to provide support. You can find efficiency dividends, you can find savings—you can always make these decisions. We would argue that we made such decisions in government. However, across the OECD, as the member for Jagajaga said, we spend less on welfare than any country other than Iceland. Welfare expenditure in Australia accounted for just 8.6 per cent of GDP last year, compared to the OECD average of 13 per cent. Just last week the Melbourne Institute released a report which clearly indicated that Australians are also dramatically reducing their dependence on welfare. In 2001, 23 per cent of working age people in Australia received a welfare payment each week. In 2011 that had dropped to 18.5 per cent.

These measures are cruel. The member for Jagajaga outlined in detail the extent to which these measures are cruel, unfair and not substantiated by any compelling argument by the government. Yet, despite the scale of these measures and the impact that will be felt by millions of Australians, this government has confined this debate to three hours: 30 measures, 10 measures per hour to be debated in this chamber, despite the fact that they will inflict pain on millions of Australians. Not only are these bills wrong; the manner in which the government have chosen to debate them—or, should I say, fail to debate them and argue their case—is an indictment of the government and shows how out of touch they really are.

These measures will have a terrible social impact on many, many families and pensioners. This is going to tear the compact between the Commonwealth government and its citizens in relation to so many of the current forms of support that people look to so that they can make ends meet. Together, these bills include $7.5 billion in cuts to family payments. Low-income couples with children and single parents will suffer the most. These bills seek to freeze the rates and thresholds for family tax benefits, including the low income free area for those who receive the maximum rate of FTB A of $48,837. According to the Department of Social Services, a freeze to the low income free area for FTB A alone will see more than 370,000 families around $750 a year worse off in 2016-17. Remember, this comes off the back of losing the schoolkids bonus, which the Prime Minister is trying to abolish. So the combination of these measures will impact severely on families.

I want to return to the points I made in relation to young job seekers. I have already talked about the amount of income a person moving from Newstart to youth allowance will lose. I also have concerns, as does every member of the opposition, about job seekers under the age of 30 having no support for the entire six months from this government. Any income provided to job seekers should be providing support for them to find work. It is in fact an obligation that, if you receive income from the government to find work, you must look for work. Indeed, I agree that if people are in a position to look for work and they receive any income they must look for work or there could be consequences for that income. But this is providing nothing whatsoever. Instead of leaning down and lifting a person up, it appears this government wants to lean down and push those job seekers further down to the margins of society. The problem with that proposition is that you are going to see people suffer as a result.

There is no question in my mind that there will be an increase in antisocial behaviour, an increase in crime on our streets and an increase in homelessness as a result of the cruelty of this government. The fact is that the young job seekers of this nation are our future. To treat them so shabbily and harshly I think is not only socially reprehensible, it is economically stupid. But it seems that, no matter what we say, the government has chosen not to listen to us on these issues. These bills are replete with measures that will hurt millions of Australians. The government should rethink its position because, quite frankly, the cruelty is unprecedented. I am sure the millions of Australians who will be affected know that and they are going to let the government know that very soon.


No comments