Julie Owens (Parramatta, Australian Labor Party, Shadow Assistant Minister for Citizenship and Multicultural Australia) Share this | Hansard source

I'm very proud to stand to support the Fair Work Amendment (Restoring Penalty Rates) Bill, because we on this side of the House understand just how much pressure families are under. Cost-of-living pressures and the cost of rent in my area of Parramatta are dramatically impacting on households' capacity to pay their bills. I know how many families in my area trying to balance their work, family and cost-of-living issues have sorted out ways to get through their lives by working a few extra shifts on the weekend, with maybe one partner working a few extra days. That is incredibly important to the decisions they have made about how they fund their families and pay the bills. And this decision by the Fair Work Commission and the decision by this Turnbull government to enthusiastically support that decision show just how out of touch this government is. It shows a complete lack of understanding of how much pressure households are under from the costs of living and stagnant wage growth, let alone wage cuts. It's also bad economics. It was at the time and it has been proven to be so since it was introduced.

Let's look at the impact on families first. Let's look at who's hit and who suffers the most. Low-paid workers in retail, fast food, hospitality and pharmacy have had their penalty rates cut and, when it flows through finally, will be up to $3,273 worse off a year. That's a $70 cut for a Sunday penalty shift. Calculations show that, because of the cuts to Sunday and public holiday penalty rates, workers in various industries face cuts to take-home pay up to the following amounts: pharmacy, $3,273; retail, $2,450; hospitality, $1,884; fast food, $1,628; and restaurants, $586. The government can afford to give $7,000 tax cuts to people on $200,000 a year, while taking away penalty rates from the people who can least afford it. In Parramatta, there are 12,300 people or one in six workers in the retail, food and accommodation industries affected by the cuts to penalty rates. That's one in six. In Parramatta, we're seeing up to one in six workers losing up to $77 a week as well as an additional $80 a week on new tolls, rents well over $400 a week and a new Medicare levy coming in for lower income workers. The government, of course, thinks it can compensate people with a $10 a week tax cut for what are substantial decreases in their take-home pay. But it's not just about the families that are affected. These are actually customers. One in six customers in Parramatta have had their take-home pay cut, and these are the lowest paid people in our community who spend every dollar they earn. If you cut the wages of one in six of your customers, what do you think you get? You get less spending for a start. That, to me, is so obvious. When we have been debating this for over a year now, I've been wondering why those on the other side who claim to know so much about business don't get what happens when one in six of your customers get their take-home pay cut, particularly if those customers are the ones that spend all the money.

The figures prove the point. A survey of 1,351 workers by the University of Wollongong and Macquarie University found 'there has been no short-term increase in the number of hours worked by employees'. The government promised that, if they cut penalty rates, there would be more jobs and more hours. There are not. University of Wollongong lecturer Martin O'Brien is reported as saying:

… some workers experienced a drop in the number of penalty-rate hours they worked in the first two months after penalty rates were reduced.

They concluded:

… 15 per cent of all retail workers who were employed on Sundays worked 9 per cent fewer hours, while hospitality workers experienced no change.

So retail workers actually worked fewer hours.

It was also obvious that the cuts would impact on consumer spending. All those penalty rate workers that dropped into the pub on the way home from work before their penalty rates were cut just don't do it now. They just don't do it. They have less money in their pockets to spend in local businesses. The controversial cuts to Sunday and public holiday rates on 1 July were followed by the weakest three months of consumer spending since the global financial crisis. So consumer spending was at zero growth following the cuts to penalty rates.

All the promises about the positive benefits of cuts to penalty rates have not been forthcoming, but damage to the income of households has. We have families increasingly struggling to pay the bills and looking at subsequent penalty rate cuts over the next few years. It's bad policy from the government, and I support this amendment to wind it back.

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