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; Consideration in Detail

9:23 pm

Photo of Tim WattsTim Watts (Gellibrand, Australian Labor Party) Share this | Hansard source

I am pleased to have the opportunity to participate in this part of the debate, given that I was next on the list to speak before the government gagged those on this side of the House from contributing on this bill. I have a question for the government in this part of the debate. We have heard a lot of talk about the supposed welfare crisis that is the justification for this bill and an unsustainable welfare system in Australia. We have heard the talk about ending the age of entitlement. My question for those opposite is: where is this crisis?

We can see clearly, when you consider the entire OECD, that Australia spends less on welfare as a proportion of GDP than any other country except Iceland. That is less even than the notoriously parsimonious United States. In fact, we could spend up to $60 billion more on our welfare system and still not meet the US spend as a proportion of GDP. When welfare expenditure in Australia accounted for just 8.6 per cent of GDP in 2013, significantly less than the OECD average of 13 per cent, those on the side of the House ask: where is the welfare crisis?

The Melbourne Institute recently released a report demonstrating that reliance on welfare amongst Australians has been decreasing over the last decade and that the percentage of people of working age receiving a welfare payment each week declined from 23 per cent in 2001 to 18 per cent in 2011. Further, it demonstrated that the number of households that are almost entirely dependent on welfare payments has decreased by almost 30 per cent since 2001. Again I ask: where is the welfare crisis?

These figures deal with the total quantum of welfare. But, if we look at where welfare payments go in Australia, we see a healthy, effective and targeted welfare system in this country. To quote from my good friend Matthew Cowgill at the Australian Council of Trade Unions, ABS figures from 2009-10 show that the poorest 20 per cent of Australian households received an average of $323 a week in cash benefits while the richest received just $22 per week—a ratio of $14.7 to a poor household for every dollar that goes to the richest.

Peter Whitford from the Australian National University has shown that a far larger proportion of our cash benefits go to the poorest households than in any other advanced economy. Not only do rich Australians receive a tiny share of welfare spending but their share is smaller than it used to be in the 1980s and early 1990s. The idea that Australia is a land of rampant middle- and upper-class welfare is a myth.

The next question I have those opposite is: how are the vulnerable in our society supposed to survive if they are unable to find a job in the cruel world created by this bill? The learn or earn policy detailed in this bill is, perhaps, one of the cruellest cuts outlined by the Abbott government in the budget. It is no secret that youth unemployment in segments of Australia is reaching a crisis point. Figures released by the Brotherhood of St Laurence earlier this year indicate that around Australia around 12.4 four per cent of our young people are unable to find work—a figure that is rising. In Melbourne's west, in my electorate, the figure is even higher—13.6 per cent of young people in Melbourne's west are not able to find employment to support themselves. These youth need all the help they can get to get back into the workforce. They should not be punished for not finding jobs that simply do not exist. The changes in Newstart and Youth Allowance in the bills under consideration will do this. If after six months of income support a young person has not yet found a job they will be required to take part in the Work for the Dole scheme. If after this period of time they are still unable to find work, they will lose all welfare payments for a further period of six months. That is six months without any form of income support at all. It is not so much ripping a hole in the social safety net as throwing it away altogether.

I further ask the minister: is it not true that they know what the impacts of these cruel budget cuts will be on people in electorates like my own? The fact that the budget includes money to cover the, quote, 'additional emergency services' required due to this learn-or-earn budget is a dead giveaway. The government is allocating additional money in the budget for the poverty that they are, in fact, creating. It would be funny if it was not so horrific for thousands of young Australians in Australia. There will be thousands of people affected by these cruel changes. The Department of Social Services admitted that they were expecting 500,000 new claims for emergency assistance as a result of these measures—half a million Australians abandoned by the Abbott government all for the sake of an extreme, factless ideological attack on Australia's effective and efficient welfare system. These are measures that will fall hard upon unemployed youth in our country.

The next question I have for those opposite is: how can they look Australian families in the eye after going to last election promising to ease cost-of-living pressures on Australian families and then, after the federal budget, ripping $7.5 billion from family payments? These bills contain freezes on the rates and thresholds of family tax benefits A and B. They also include a freeze on the low-income area for tax benefit A. According to the Department of Social Services, this will see more 370,000 Australian families around $750 a year worse off. So I ask those opposite, who promised to ease cost-of-living pressures on Australian families, how they look Australian parents in the eye.


No comments