Katie Allen (Higgins, Liberal Party) Share this | Hansard source

I rise to support the Social Services Legislation Amendment (Strengthening Income Support) Bill 2021. This bill is an investment in the Australian people, helping them to get back into the workforce. It will go a long way to helping vulnerable Australians and will work for those who need it most.

The Morrison government is committed to this $9 billion increase to the pre-COVID-pandemic JobSeeker rate. This equates to about a 10 per cent increase on the government's annual JobSeeker spend and represents, most importantly, the largest year-on-year increase to unemployment benefits since 1986. There will be some people who will say, 'This is not enough,' but let me clarify that this is the first real increase to the unemployment benefit rate since the Keating Labor government increased the rate by $2.95 a week, or 42c a day, in 1992. What we're offering with this bill is a $50 a fortnight increase. That's more than eight times greater than what the ALP had to offer almost three decades ago.

We believe that the base level of support that exists within our social safety net needs to be adjusted, not just for the here and now but for the long term. That is why this increase is permanent. And it is something that all Australians can be proud of. It's about supporting those who are in need. It's about supporting our most vulnerable.

But let me be clear. While the JobSeeker increase is about increasing the safety net for those who need it most, it is not a wage replacement; nor is it an extension of COVID supports or stimulus. As always, the government's key focus is job creation and getting people back into work, because we know that getting a job is the best way to support people and their families.

This bill is timely, as we know, because the COVID pandemic has caused a once-in-a-lifetime disruption to the labour market. All Australians should be proud of our comprehensive welfare system and that it was able to provide emergency support to Australians who found themselves unemployed.

We all saw those huge lines outside Centrelink one year ago, and we all heard the collective sigh of relief right across Australia when the amazing JobKeeper program was implemented—a program that delivered support to those in a job and delivered dignity to those who were finding that their businesses were at risk.

At the beginning of the COVID pandemic, we put in place a series of emergency measures designed to protect Australian livelihoods and lives, and that is what we've done throughout the COVID crisis. We've always kept our eye firmly on the fact that the COVID pandemic was a dual crisis. This crisis was both a health one and an economic one.

By the end of March this year, we will have injected around $33 billion through emergency payments into our welfare system since the start of the COVID pandemic to support unemployed Australians. We backed in Australians facing a crisis that, through no fault of their own, was causing devastation, and, as the Prime Minister has said, we did it the Australian way. The coronavirus supplement, which was our first initiative, helped ensure that we strengthened the safety net that not every country in the world has already had in place but one upon which Australians have relied. At the same time that we announced this increased, strengthened safety net, we said that it had to be targeted, it had to be scalable and it had to be time-limited. Australians know they can expect certainty with our government. We've lived up to our word, and, as the impact of the COVID pandemic continued, we extended but scaled back the supplement as required.

Our emergency measures have worked. The comeback in Australia's economy is already well underway, and it betters the experience of most developed nations in the world today. It's something we can all be proud of, on both sides of the House. It means that we no longer need to rely on the supports which have sustained us during the last 12 months to the same degree. It is time for us to move on past this crisis.

With the commencement of the vaccination program, Australia is comfortably moving into the next phase of how we fight the COVID pandemic. We've aggressively suppressed it, and we're now moving into the vaccination phase. We will continue to battle to secure the livelihoods and lives of all Australians, but now that our vaccine rollout is underway it is time we moved from short-term emergency measures to long-term arrangements that people can rely on should they find themselves out of work.

We need to think about the fact that the economic outlook is improving and the recovery is well underway. The resilience in the labour market reinforces that Australia entered this crisis from a position of labour market and economic strength. Fifty-thousand new jobs were created in December alone, 71 per cent of which were full time, and 785,000 jobs have been created in the last seven months, with 90 per cent of the record number of jobs lost at the height of the COVID pandemic already recovered. Further, the unemployment rate has decreased from 7.5 per cent in July last year to 6.6 per cent in December. That is remarkable. Of the 1.3 million people who lost their job or were stood down on zero hours, 90 per cent are now back at work. Australian job advertisements, measured by ANZ, rose 2.3 per cent in the month of January—the eighth consecutive monthly gain, increasing the annual growth up to 5.3 per cent, with the series at its highest level since April 2019. These are encouraging signs, to say the least. According to the National Australia Bank business survey, both business confidence and conditions have increased above pre-pandemic levels—and their respective long-run average. The economy is pumped, primed and ready. And those facts are simply remarkable. Business conditions rose further in December, increasing seven points to a positive 14 index points, its highest level since late 2018. While consumer and business confidence has recovered as restrictions have come off, this will be further supported by the vaccine rollout.

The bill we debate today will support millions of Australians. In fact, from 1 April, if passed, it will provide 1.95 million Australians who are currently accessing working age payments with a permanent $50 per fortnight increase in their rate of payment. I'm sure they will be relieved to hear that this increase is permanent. In addition, we are also permanently increasing the amount of money jobseekers can earn before they lose a cent of payment up to $150 per fortnight. We are also temporarily extending the waiver of the one-week ordinary waiting period for certain payments for a further three months till 30 June 2021. Further, we'll also be temporarily extending to 30 June 2021 the expanded eligibility criteria for the JobSeeker payment and youth allowance for those required to self-isolate on the basis of directions from health authorities or to care for others as a result of COVID. We know there are still effects from COVID that need to be taken into account as we transition to our post-COVID recovery.

While the comeback in Australia's economy is already underway, we know we continue to confront challenges caused by the COVID pandemic. While we're scaling back the COVID economic stimulus payments, let me be clear that the JobSeeker increase is an increase to the base rate of payment. It is not a cut, as those opposite would have you believe. For it to be a cut, it would have to be a reduction relative to an ongoing measure. JobSeeker is fundamentally important, but so are the other forms of welfare that people can access. It is worth noting that 99 per cent of people on JobSeeker receive additional payments on top of their base rate. For instance, a single renter with no dependants will receive a fortnightly payment of $620 plus an $8.80 emergency energy supplement and $140 in rent assistance, a total of $770 a fortnight. Approximately 685,000 Australians, or 55 per cent of JobSeeker payment recipients, are in this position.

This increase was also not designed with stimulus in mind. The government does not make decisions about safety net supports based on how it will impact aggregate demand. While there may be a second-order effect, it is not the reason that we make changes to payments. In making this decision, we had to consider a range of factors while balancing three key principles: firstly, our responsibility to support those who can't help themselves, and unemployed Australians; secondly, to incentivise people to take up work; and, thirdly, to keep the welfare budget sustainable. Amongst the factors we considered was the fact that the minimum wage has been growing at a faster rate than unemployment benefits. This increase pushes the base rate up to 41 per cent of the national minimum wage, which is up from 37 per cent, putting it at the level it was during the early 2000s. The government also believes it is important for payments to cease before a welfare recipient's income reaches the minimum wage. This means that individuals will always be better off in a job than on welfare. People receiving the base rate of JobSeeker will cease to be eligible for payments once their earnings reach $1,217 per fortnight, or $1,449 for those receiving rent assistance.

The government has always been focused on balancing support for unemployed Australians with incentives to work. We understand that it's hard to live without a job. This JobSeeker increase will work alongside the existing opportunities we provide to upskill and retrain job-seeking Australians and support people back into work. That's why, as a permanent reform, we're increasing the income-free area to $150 per fortnight. We want to encourage all unemployed Australians to dip their toe in the jobs market and take the first step towards re-engaging with the workforce. We know it builds confidence for them. That has been the consistent feedback from businesses in particular industries and regions where recruitment remains difficult, and it has been reflected in firm indicators such as the monthly employers survey conducted by the National Skills Commission. It is not right for these industries to suffer and for taxpayers to reach into their pockets while plenty of jobs go undone, including unskilled and low-skilled jobs that are suitable for a wide range of those who could do them.

This bill will provide people with additional support as the economy continues to recover and they're able to transition back to work. It will allow people to keep more of what they earn as they reconnect with the labour market. This plan is not only significant; it is fair and sustainable for both unemployed people and the taxpayers who fund the support. It is a historic increase in welfare payments, and it should be recognised as such. This is about making sure we get the balance right between support for people while they look for a job and incentives to work. I commend the bill to the House.

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