Andrew Southcott (Boothby, Liberal Party, Shadow Minister for Employment Participation, Training and Sport) Share this | Link to this | Hansard source

I am pleased to speak on the Social Security Amendment (Training Incentives) Bill 2009 and indicate that the opposition will not be opposing this legislation. It is worth looking back 18 months because the government have now been in place for a little bit more than 18 months and it is time to deliver a mid-term report card on them.

When you look specifically at the area of youth unemployment, you see in only 18 months a terrible performance in jobs for teenagers, young Australians. Looking back to November 2007, specifically at 15- to 19-year-old Australians, there were 257,000 in full-time jobs, compared with 222,400 now. There are almost 35,000 fewer teenagers in full-time jobs now than when the Rudd government were first elected. There are 31,000 fewer teenagers in jobs in total. There are now an extra 4,300 teenagers who are unemployed. We have also seen very large falls in the participation rate for teenagers, from 60.4 per cent to 57.4 per cent and in the employment rate for teenagers—that is, the employment-to-population ratio—from 51 per cent to 47.8 per cent. That is a big change in just 18 months.

The lesson of previous recessions, of the early 1980s and early 1990s, is that people who are just entering the labour force for the first time are often hit much harder. Youth unemployment in Australia generally rises at twice the rate of total unemployment. When we look at 15- to 24-year-olds, we see almost 70,000 fewer full-time jobs and 32,500 more unemployed. The unemployment rate for those looking for full-time work is up from 9.8 per cent to 12.4 per cent. The overall unemployment rate is up from 9.7 per cent to 11.4 per cent. This is in just 18 months. The participation rate for these young Australians has fallen from 71.2 per cent to 69.4 per cent, and the employment rate, or employment-to-population ratio, has fallen almost three per cent, from 64.1 per cent to 61.2 per cent.

When you look at the labour force as a whole, over the last 12 months the economy has lost about 60,000 full-time jobs and there have been about 100,000 part-time jobs created. When you look at the losses that have occurred in the 15- to 24-year-old age group, there have been 70,000 full-time jobs lost in the Australian economy, and that is equivalent to the entire loss of full-time jobs in the Australian economy over the last 12 months. So this group is definitely bearing the brunt of the global financial crisis, but the Rudd government has introduced some specific policies that will disproportionately affect young Australians and their opportunities to get a start and to get a job.

The bungled Job Services Australia will see massive disruption in the area of employment services, such that 47 per cent of job seekers will be changing their provider and changing their case worker on 1 July, at a time when unemployment is rising. We have heard from industry groups, from Restaurant and Catering, from pharmacies and from newsagents that the award modernisation process will again lead to the loss of jobs, and, typically, a lot of these jobs will be entry-level jobs for young people. We have heard from a variety of groups that the government’s Fair Work Bill will again be job destroying. These are three specific decisions that the government have taken. It is no wonder they are having to pump out billions and billions of dollars without having any idea of how many jobs will be created or supported when they have made specific decisions which go to the heart of the opportunities that there will be in the labour market.

There are two parts in this bill. The first part is for a temporary training supplement of $41.60 per fortnight to eligible job seekers on Newstart or parenting payment who undertake approved training. These will be job seekers who do not have a year 12 or equivalent level qualification, or who have a trade or vocational qualification that can be upgraded to help them find work. The payment will be available from 1 July 2009 to June 2011.

The opposition are not opposed to training, but we believe that training is only one limb or one element of getting someone into a job. One of the weaknesses of the government’s approach has been a complete failure to create a climate of strong job creation. Labor have failed to define a clear pathway between training and a job. There is a training mantra but not a jobs mantra. It is critical that unemployment is addressed by boosting business confidence and encouraging employers to take on new employees. The training supplement is something we do not oppose, but, again, we believe that it is critical to demonstrate how this will lead into employment.

The second part of the bill relates to amending the participation requirements for certain young people, requiring them to either earn or learn to be eligible for youth allowance. The opposition supports this approach. Over the last 12 months we have seen the number of teenagers who are not in full-time education or full-time employment increase from fewer than 200,000—about 195,000—to 242,000. What we know is that people who are not in full-time education and not in full-time employment traditionally will languish and have trouble remaining in the labour force over their lifetimes. As I said earlier, during past economic downturns youth unemployment has increased disproportionately. It is critical that we ensure that young people do not become disengaged and disenfranchised. One of the concerns about the labour force statistics is that we are seeing very large falls in the participation rates of young Australians. We have seen in a period of 18 months very dramatic falls in the participation rates for young Australians. It is critical that we do keep people engaged in the labour market and we do keep people actively looking for work.

As I said, the opposition does support the tightening-up of youth allowance. But, again, it is only one aspect of improving youth unemployment and providing more opportunities for younger Australians. There are lots of aspects that need to be addressed so that employers will take on extra workers so there will be the jobs there for younger Australians. As I said at the start, what we have seen is disappearing jobs for younger Australians—full-time jobs and overall jobs—and big falls in the participation rate and the employment rate. So, whilst training and education can certainly boost employability, training is not for everyone and not everyone gains a benefit from training. The experience around the world is that training programs can be very expensive and actually have quite poor employment outcomes. We believe it is important to tailor approaches to the individual.

The opposition will be looking very carefully at the labour force figures, ensuring that ‘learn or earn’ is not a cynical attempt to distort and manipulate the unemployment figures as people who would otherwise be looking for work are pushed into training in order to claim income support payments. We do not want to see a return to the training treadmill and many of the training programs of Working Nation, which actually had very poor employment outcomes and very low chances of people going from those programs into a job. We will be watching the figures on youth unemployment very carefully. We think that this is a critical area to address for the future because it is very important that people do remain engaged, do remain active, so that they have a much stronger connection with the labour force over their lives.

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

I rise to very strongly support the Social Security Amendment (Training Incentives) Bill 2009 before us today. As a person who in a past life worked with young people who were looking for work, and as a person who has had a lot to do with the actual training aspects of young people and workers generally, I feel that this ‘learn or earn’ legislation is very important. At the commencement of my contribution to this debate I would like to very strongly emphasise that to let young people who are unemployed languish, without any assistance from government, is despicable. What this legislation will do when it is enacted is see that that does not happen.

What I also think is despicable is for young people with poor skills, poor literacy and poor numeracy to be penalised and to be thrown on the backburner and totally disregarded—put into a Work for the Dole program, if there is one available, but at no time really having the issues that goes to that person’s employability addressed. I think this legislation actually looks at some of those issues and will provide hope and a start for young people.

In the past few years we have had a government—not the Rudd government but the previous government—that really squandered opportunities and did not train those people for the jobs that were available. We had a chronic skills shortage here in Australia at a time when our economy was thriving, when there was this great need for people to fill the jobs that were vacant. It would have been an excellent opportunity for the then government to embrace legislation like that we are debating here tonight, legislation that would have ensured that young people were prepared for work and that they were moving forward and being placed in a situation where they could make a tangible contribution to our economy, where they had the skills that they needed to enter the workforce and where they could undertake ongoing training.

This bill will amend the Social Security Act 1991 to provide for training supplements for eligible recipients of parenting payment and Newstart allowance who have not completed year 12 or equivalent or who seek to upgrade their vocational qualifications and who commence approved training or further education between 1 July 2009 and 30 June 2011. So, here you see the target group: young people who have not completed year 12 or equivalent and who really do not have the education or the skills that they need to enter the workforce.

On my way into the chamber I believe I heard the shadow minister for employment participation saying that unemployment has risen. Yes, it has risen, and we acknowledge that on this side of the chamber. We also acknowledge that the global financial crisis is having an enormous impact on employment but not as big an impact in Australia as it is having elsewhere. We see this as an opportunity to provide that training for young people.

The legislation also amends the participation requirement for Youth Allowance, where a person under 20 years of age has not completed year 12 or an equivalent certificate level II to level IV qualification. A youth allowance will be payable to young people without year 12 or equivalent if they study full time or if they comply with the Youth Allowance Employment Pathway Plan.

I need to talk a little bit about the Employment Pathway Plan. It is absolutely imperative that a young person with limited training, maybe sometimes a less than perfect education and very few skills determines a goal and works out how they are going to achieve that goal. In working towards that goal they will have a number of strategies. In those strategies they will list the steps need to be taken for them to gain the qualification and gain a job at the end. For instance, an early school leaver may feel that they would make an excellent horticulturalist—they like being outdoors, they like gardening and they do not mind hard work—but they are unaware of what they need to do to obtain a position working in horticulture. For that person an Employment Pathway Plan needs to be developed whereby they will be able to undertake the certificate-level courses that meet with the requirements of the job. They will follow it up with some work experience and on-the-job training as well as some formal off-the-job training. The pathway plan will require at least 25 hours a week in a combination of part-time study or training and other approved activities, which could be on-the-job training, which I think is important because it is all part of helping the young person to develop the skills that they need to enter the workforce.

Some exemptions will apply. We know that training may be reasonably available for a person but the person may not have the capacity to undertake the available training. That could occur in a situation where the young person lives in quite a remote area, where there is only training at a much higher level than the person has the basic skills to undertake or where the person has a disability and needs to undertake a specialised form of training.

The training supplement has a financial impact of $83.1 million in additional spending over four years, so you can see that the government is making a significant contribution to the training of young Australians. The government is prepared to invest at this particular time in Australia’s future. That is what this is; it is investing in training young people for Australia’s future so that when things improve globally and within the Australian economy—when more jobs become available—we will have young people with the skills who can walk into those jobs. We will be competitive not only within Australia but globally.

The measure also amends the participation requirements for 15- to 20-year-olds and has a net financial cost of $14.4 million over four years. The training supplement is an additional time-limited payment of $41.60 per fortnight. That training allowance is an incentive to young people to undertake the training. The budget announcement for this measure stated that changes to the participation requirement for Youth Allowance will come into effect on 1 July this year and for new claimants without year 12 or equivalent from 1 January 2010. The budget announcements also state that the training supplements will commence from 1 July this year. So it is very important that this legislation gets through the parliament in this sitting. It is very important that we are prepared to provide the training that these young people need.

The bill will also assist low-skilled job seekers with the costs of participation in training or further education which may assist them to obtain employment in the future. Job seekers will need to participate in approved education or training to receive the training supplements. Some people might study full-time; some might study part-time. Partial capacity to work will come into play. People doing courses that go for longer than a 12-month period may be eligible for student income support payments.

The fact that this legislation is targeting low-skilled workers is very important for us here in the parliament to consider. We need to upskill our workforce. As I mentioned at the commencement of my contribution to this debate, one of the big mistakes that the previous government made was failing to skill our workforce and failing to train people for the jobs that were available in Australia. It was such a missed opportunity. At that particular time, we had job vacancies and a very significant youth unemployment rate. What we are doing is addressing the needs of young people and the needs of Australia.

The bill will also encourage more young people to gain the education and skills that they need to move into further education. It is not only employment that is important. Success at a lower level course gives young people the confidence to move on to courses that will set them up for a career for their rest of their lives. That career could start with an apprenticeship or otherwise; the employment could be in any job that young people find that they are interested in.

Some young job seekers who participate in the productivity placement program, which is another aspect of this legislation, will not have to pay for their courses. However, not all courses taken up through the PPP will fit into that category. This is recognition that some people need more help. There is not a member in this House who would deny the fact that there are definitely a lot of young people out there who, through no fault of their own, find themselves in quite disadvantaged situations. The PPP will work well with that particular group of young people. Once again, this legislation is looking after particularly disadvantaged young people.

This legislation has been quite well received. I note that ACOSS are a little cautious but cautiously supportive of the proposal. They state that they will be looking closely at the youth allowance conditions so that disadvantaged young Australians are not unfairly penalised, which is what happened under the previous administration. These young Australians were unfairly penalised but not given the training that they needed. ACOSS also said that they acknowledge that there is a need for ongoing training and mentoring that suits the circumstances of young people.

The National Union of Students said:

It is good to see that the government is expanding the number of tertiary and training places. A renewed government focus on education will help generations through the recession.

That is exactly right. They also said, however, that the COAG policies must not be all stick and no carrot. That was a problem under the previous government. For anything to be successful, you need to make sure that you have the mixture of carrot and stick right.

There will be a significant number of places available as part of the youth compact with the state and territory governments. There is a commitment to immediate action to ensure significant school and training places are available for people aged 15 to 19 who are entitled to an education or training place. This must be fully implemented by 1 July this year. Once again, this is a commitment by government to young people. It will ensure that they have a future. The government is prepared to get behind them and offer them the training and the skills that they need to enter the workforce. As I mentioned previously, part of that plan includes on-the-job and off-the-job training. I see that as providing very broad and full training to young people.

In addition, young people aged 20 to 24 will have an entitlement to education and training. This commitment will be implemented by 1 January 2010. State and territory governments will work with their education authorities and training providers to make arrangements for determining eligibility for an entitlement place. It is anticipated that most places will be provided by TAFEs and some registered private training organisations offering government subsidised qualifications. The Commonwealth, states and territories will work together to ensure that those young people living in rural and remote areas will also get the access that they not only need but deserve.

This legislation provides hope for a future for young people. Changes in this legislation support the youth compact and the national youth participation requirements agreed by COAG on 30 April 2009. This measure will also assist in bringing forward the COAG targets of 90 per cent year 12 or equivalent attainment rates for 2015 to 2020. The training supplement will be available for two years to provide enhanced incentives for job seekers to gain skills and qualifications during the global recession. This legislation is about government acting. This is about the Rudd government recognising that young people deserve a future, and it is investing in their future by giving them opportunities to undertake training so as to prepare themselves for jobs as they become available.

Wilson Tuckey (O'Connor, Liberal Party) Share this | Link to this | Hansard source

In her closing statement, the member for Shortland ran one of the recitation issues that this parliament is now confronted with in terms of ‘a government acting’. There is only way to describe the Social Security Amendment (Training Incentives) Bill 2009, and that is ‘a government reacting’. It is reacting to a very significant fall in employment, particularly amongst young people. It is, of course, the outcome of recession, including—as the minister reminded us during her second reading speech—the recession that we had to have in the 1990s, when it was again young people in particular who found employment very hard to obtain.

Another factor that is making it difficult for young people to get employment is the simple fact that employers are preparing themselves for the introduction of the Fair Work Australia legislation on 1 July. We see daily reports in the media of efforts by the trade union movement to further extend its power and, from its perspective, hopefully its revenues. This is to generate enough money to run another misleading campaign to try to convince the working people of Australia that this government should remain in office, knowing full well that we are not part of the trade union appreciation society. We are not dependent upon its funding to win or lose elections. This has been highlighted by the most recent unemployment statistics, which show a fall in the number of people in permanent employment from 25,000 to 20,000.

The unemployment figures were compensated by a similar number in casual employment. And, of course, employment is going to go casual because that is the protective mechanism that small business employers will put into their arrangements to ensure that they do not get caught in the ‘go away’ money trap that was significant with the previous unfair dismissal exercise. That legislation just became unfair to employers who were silly enough to give people a full-time job and who, for whatever reason, found later that they had to disconnect from those people—and probably for very good reason, as was frequently raised with my office. For example, one small business man put on two workers and, at the end of 12 months, the business that he had anticipated had not materialised. He very apologetically put off these two people, paid them in excess of their entitlement and then received claims from each of them for $10,000 for unfair dismissal. He rang his industrial adviser and said, ‘I’ll fight these rotten devils to the High Court.’ His adviser said, ‘And how much are they asking for?’ and he said, ‘$10,000 each.’ His adviser said: ‘Pay them. You’ll win your case but it’ll cost you more than that to do so.’ That is coming up. Small business learnt its lesson last time.

The reverse applied when the Howard government discontinued unfair dismissal legislation for employers with fewer than 100 workers and, as a result, 50,000 jobs materialised in a month. In both New South Wales and Victoria—the typical rust bucket states that were not benefiting from the huge growth in resources exports—jobs materialised not because they were necessarily new jobs but because people had the confidence to employ people on a full-time basis.

As history also tells us, there was a time when it was not unusual for young people to leave the workforce after year 10 and enter into on-the-job apprenticeships and other on-the-job training positions. In years gone by, this did not even include TAFE training, which I think is a necessary part of today’s arrangements. But, again, we wonder why employers are not breaking their necks to take on apprentices and trainees in various categories when they are paid at a rate that does not equate to their productive effort and, more particularly, sees them absent from their workplace one or two days a week for training. No compensation of consequence is paid to employers for having those people unavailable on those days.

These situations have arisen. This legislation proposes that the taxpayer picks up some of that tab, and that may therefore be advantageous, not for people in work but for people who are not in work. It is referred to—and I endorse this principle—as ‘learn or earn’. Whilst I do not disagree with a reasonable safety net, it has unfortunately been found by a lot of young people to be sufficient to get by on, and they then do not seriously seek employment. If I were to be given a couple of hours to speak on this issue in this place, I could run through a list of examples where I and members of my extended family, as employers, have had unemployed persons turn up at our places of business for the purpose of doing an interview and, in their opening remarks, say: ‘We don’t want this job, you know. We’re not going to take it. We’ll really be a nuisance to you if you employ us.’ They were there to get a signature in their book to say that they had been out actively seeking work. This provision may do something in that regard and that of course will be a positive.

I can see that it is a means of assisting. It is going to cost substantial amounts of money—$83.1 million is targeted to date—and, in fact, job seekers meeting these requirements will receive an extra $41.60 per fortnight if they undertake an approved training or further education course of less than 12 months duration at the certificate II, III or IV level. But let me return to the issue as to why it now appears that by year 10 you have not absorbed enough education to take a job in the trades or elsewhere, as was previously the case. One can say, ‘Oh well, it’s all computerised now.’ That is a complexity. That seems to be one of the things that most kids know about and understand before they go to school. I was talking to someone the other day who had to ring their grandchild to help them sort out a software problem they were experiencing with their computer at home. That is wonderful and we read about this all over the place.

I once learnt to fly a Chipmunk aeroplane and its only form of navigation was a marine compass. If I were to try to fly a current model of aeroplane today without high levels of computer skills, I would not be able to get it off the ground. Unfortunately, we recently read of a disaster where computers were suddenly interrupted and how difficult it was for a professional pilot to fly a commercial aircraft. A farmer in my electorate of O’Connor is now employing equipment which literally drives itself very accurately. So there is a need for that form of training. On the other hand, as reported in the media recently, three young mothers turned up at a picture theatre and, for reasons not stated, could not work out how much was three times the entry fee of $9. That is not an indictment of those people but an indictment of an education system that has probably turned them out in year 10 with the inability to say that three nines are 27. Why is that? Because, quite foolishly, we walked away from the education structures that made sure everybody knew those basic forms of multiplication.

I ran hotels for about 25 to 30 years and I employed a vast number of staff on about one hour’s assessment. The first thing I looked at was whether they walked fast or slowly, but each and every one of those people, particularly the women, had the ability to add up. They could not go to the electronic machine that is now provided and is about the slowest way of dispensing alcohol I have ever seen in my life. I do not know how you can have an alcopops problem. They could add up and they did add up as they put the drinks order together and told the group to which they were supplying the drinks the price. How did they learn that? There were no computers to assist. The cash register was of the push-down variety on which you registered the amount involved; you did not get a message from the register telling you what the change was. You had to work it out yourself. These were young and not-so-young men and women who could add up without any difficulty. From my own recollection, when you walked into a school in the opening period you heard kids in every classroom reciting their times tables. They were actually taught to read by phonetics. And where are we now? We are back to phonics. We have gone back to having that debate after the elite education establishment undermined all the practical outcomes that equipped a young person to enter employment after year 10.

As I have said, there are certain technical aspects to this bill—I read the statistics in the second reading speech of the Minister for Education—but without an adequate basic education another year’s training is not going to do much and, if that year’s training is needed to repair the incapacity of a young person to read and write, should we be building new assembly halls or, better, should we be organising the teaching profession so that we can turn out young people with the basic three Rs education? I think that is a matter of grave concern. All the talk in this parliament about how much money is being spent on education and training is irrelevant unless it delivers outcomes. I smiled today when the minister was explaining that she was going to shift money from a school to which it had been allocated—the school was going to be knocked down—to a school where the other pupils were going to go. That amalgamated school might be brand new, but it is still going to get the money. I note on one occasion the government obviously woke up to that fact and said, ‘Well, we had better not spend it on paint; we will spend it on computers.’ I thought computers were coming free under another program. Are we just recycling money? Is it going to be free computers one day and a coat of paint the next day? As I said in my speech on the appropriations, very few of about the 150 schools in my electorate chose to take the $150,000 on offer. They did not take it because the opinion of the school principal and the parent associations was that they did not need that much. They are now being told to spend up to $3 million or else, yet internally the system is still advising us that young people who have not completed year 12 have an inadequate education base on which to obtain employment.

That was never the case, and it need not be the case, notwithstanding that there are good reasons for most students to continue to year 12 provided they have a capacity to absorb the education that that system provides. But what if it does not and a student’s tendency is to be a highly skilled tradesperson? It is a great tragedy of history that some of the most highly skilled tradesmen I have met going back to my childhood have had very little education. But they were highly skilled in their trade, and that has changed somewhat because a trade is not so manual. What I am saying is this: these ideas cannot be criticised and we hope they work, but they are an indictment of the existing education system because they should not be needed; the training should not be needed.

There is another problem that arises from that and, furthermore, I can quote examples. You have got to be very careful as an administrator to see that training does not become an excuse for doing nothing. In recent years I know of people who said, ‘I’m going back to do another course,’ and left full-time paid employment because a course was easier than turning up for seven hours a day in a job. So that is a problem. You get people who are perennially doing courses, and the evidence of that exists for anyone who wants to check the stats or talk to people who have employed persons who have often come to them as unemployed. I think that is another worthwhile comment to make in this debate.

In the five minutes left available to me, I note that this legislation deals with some of the principles and entry requirements for Youth Allowance. On the last sitting Thursday I presented to this parliament 6,280—as I think the number was—signatures on a petition collected in fewer than 10 days from people protesting about the unfair changes to the Youth Allowance system which pop up here in a most interesting way when the minister says, to support these initiatives, the Commonwealth government committed to making education and training a precondition ‘for young people without year 12, or the equivalent, to obtain Youth Allowance (Other) and Family Tax Benefit Part A’. The Youth Allowance took into account the fact that young people, having passed year 12, were typically wishing to enter university and often—as in the case of my electorate—were living an unacceptable travel distance from the place of learning, which required their relocation, and that the rent allowance component of youth allowance was extremely important to them. They could prove their independence by going to work where work was available.

The interesting thing about this is that, while we talk about the new conditions, which have nothing to do with parental income and all those sorts of things, they are still a roadblock to participation. Whilst the minister, in her second reading speech, admits that it is very difficult for any young person to get a job at the moment, in the same breath she says, ‘But if you can’t find one for 30 hours a week then you can’t qualify for youth allowance.’ In rural areas that does not happen. What students did under the old system was to take the seasonal work, which is now the norm through rural areas, whereby they could work long hours for good rates of pay and accumulate a sum of money—I think it reached about $19,000—and that was then their proven qualification to obtain youth allowance and take themselves off to university, where hopefully some of them might have even studied science and other scientific disciplines and went back and taught young people. In fact, now we are funding the cost of laboratories and all of these newly equipped facilities in education establishments—and hooray for that—but there is nobody with the competence to teach within the repaired or renewed or rebuilt facilities. You would not let most of them loose with a Bunsen burner. So how is that going to work?

It is just another indictment of this legislation. We do not oppose it. We wish it well, but it would not be occurring in this fashion if, when young people came out of education and were not seeking an academic career, they could have the necessary basic skills to be employed and in fact to grow into the highly qualified skills which traditionally they learned in the workplace—and learned them extremely well, as those of us know who still have the opportunity to walk into older style houses and see how they were built with a hammer, nails and handsaws and that sort of equipment no longer used to any great extent. (Time expired)

Yvette D'Ath (Petrie, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak in support of the Social Security Amendment (Training Incentives) Bill 2009. Before I go to the key areas of the bill, I will comment on some of the notable statements by the member for O’Connor. Firstly, I sincerely disagree with the member for O’Connor’s statement that he would not let most teachers loose with Bunsen burners. I think that there are some fantastic teachers out there who should be commended for the work that they are doing. We need to make sure that we are supporting those teachers. I am sure that, if the member for O’Connor looked beyond the Building the Education Revolution funding that is being provided by this government and actually looked at this government’s overall policy in relation to our education revolution, he and many of the members on the other side of the House would see that this government has committed to an overall approach to improving education in our schools, both public and private, across this country and that that includes working on a national curriculum and a whole range of initiatives. Certainly the schools in my area welcome the debate and discussion on these key areas as much as they welcome the investment in school infrastructure that they believe is also important.

The member for O’Connor seems to be arguing that we should make sure that students are fully equipped for the workforce by grade 10. You would almost be led to believe, based on the comments just made by the member for O’Connor, that we should get rid of grades 11 and 12 altogether because everyone should be suitable for the workforce by grade 10.

Wilson Tuckey (O'Connor, Liberal Party) Share this | Link to this | Hansard source

Mr Tuckey interjecting

Kelvin Thomson (Wills, Australian Labor Party) Share this | Link to this | Hansard source

Order! The member for O’Connor will cease interjecting.

Yvette D'Ath (Petrie, Australian Labor Party) Share this | Link to this | Hansard source

The member for O’Connor can argue all he wants, but comments were made over and over again during that speech on this bill that we should make sure that students are fully equipped for the workforce by grade 10. That seems to be the benchmark, not grade 12. The problem is that businesses want more than that nowadays, which the member for O’Connor and other members on the other side of the House would know if they actually went and talked to them. Businesses actually want students to have a grade 12 or equivalent qualifications or they want those students to take on further education. It is not acceptable to merely have a grade 10 qualification.

The member for O’Connor may say, ‘Well, that’s because the kids of today aren’t taught phonics and aren’t taught times tables.’ I disagree because my seven- and nine-year-olds are reciting the times tables that they are being taught in a state school and they are also learning to read and write through phonics. That sort of learning is certainly still going on in our schools and we should commend our teachers for still teaching those important fundamental aspects of education.  But we cannot ignore that computers are not just part of our schooling and our businesses but part of our way of life now.  We also need to teach our young people in primary school and secondary school to adapt with that technology as it evolves over the years.

I have no complaint about the government, the taxpayer dollars, picking up this incentive. This government has been committed since the day it got into government in 2007 about skills and skills enhancement. For more than the last decade under the Howard government what we saw was a complete reversal when it came to investment in skills. We saw it with money being pulled out of the TAFE system. We saw it with the lack of commitment towards incentives for trade training. Although we saw a government creating and building Australian technical colleges around the country, spending millions and millions of dollars establishing ATCs, what it did not do was invest in trade training in many other areas, including in our schools. What we saw was a major drain on skills in this country in the trades area. By 2007, employers were absolutely screaming out for a government which would take up the need to address skills.

This bill provides two major incentives. One is a training supplement, eligible to people who are receiving the parent payment and the Newstart allowance. It provides an additional incentive and financial support for those who do not have year 12 qualifications or the equivalent to go back and get further qualifications or a qualification beyond their schooling years. This will ensure that those people can enhance their prospects of employment by allowing them to acquire skills in a trade or a field. It may be different to the VET qualification that some of them may already have. This is very important. A time frame has been set out for this initiative. Between 1 July 2009 and 30 June 2011, persons who commence the approved training, who are on the parenting payment or Newstart allowance and who commence a course of 12 months or less in an accredited course can access this additional payment of $41.60 per fortnight to assist them—not just to assist them financially while they undertake those studies but, importantly, to assist them in becoming more work ready and more able to compete equitably in the market when it comes to finding employment.

The second initiative is the changes to the participation requirements for the ‘youth allowance other’ category. These initiatives are directed particularly at younger people in our communities who may have left school early and who can truly benefit by going back and getting qualifications or additional qualifications in a certificate under the Australian Qualifications Framework. These are the types of certificate that employers are looking for and the types of skills that employers are looking for out there in the community right now, at a time when the global economic crisis is being felt across this country. It is being felt locally in my communities in my electorate. Incentives like this for people who have not completed their full education at school are significantly beneficial. I had the opportunity to briefly look at the 2006 census data for the electorate of Petrie. Out of the just over 101,000 people who responded to the question about their highest level of education, 40 per cent had a highest level of education of grade 10 or its equivalent or lower. Although many of those would be older now—and it is true to say that in recent years more young people have been staying at school for longer—we still have too many young people dropping out of school before completing their year 12 or equivalent qualification. In my electorate, I would welcome initiatives like this that will support those people in getting those sorts of qualifications.

I know from personal experience how hard it can be when you do not finish your schooling. I left school just after grade 10, when I was 15 years old, and it was not until I was in my early 20s that I went back to night school and started doing my senior equivalent. It is true, as was said in the second reading speech in relation to these incentives, that those who go back and do further education early in their life are more likely to continue that education. Certainly for me, after doing my senior at night school in my early 20s, I then spent the next 14 years studying until I was admitted as a lawyer at the end of the process. If I am any example, there is encouragement so that, once you get back into studying, you are more inclined to continue taking on new skills and enhancing your qualifications. I am not saying that every person who may take up this incentive would necessarily do that; what I am saying is that, by creating these incentives, even if one person takes up this initiative, gains additional qualifications and consequently gets a job out of doing so, then these sorts of incentives are worth doing. I certainly commend the Rudd Labor government for putting these initiatives in place.

In addition to the federal government’s commitment to growing our skills base for this country, I can say that the Queensland government equally has that approach. In 2007, the Queensland government introduced changes to its schooling system that saw the introduction of the prep year across every school. I was fortunate that my son was in that first prep year and I have seen the benefits come from the introduction of that year. Also the state government introduced at the same time a learn or earn approach to senior students. They said to the senior students that, if they wanted to leave school before grade 12, then they were expected to be either studying full-time in some other way or going into the workforce and getting a job. I certainly support those initiatives.

I understand, as do many youth workers in my electorate, that this is not always going to be the case and there are going to be young people in every electorate who have difficulties for a whole range of reasons. They may be homeless, have substance abuse issues or have mental health issues. There are a whole range of issues that young people may be facing. That will mean that these people cannot necessarily meet the requirements for the new youth allowance participation. What I am pleased to say is that, as part of this bill, there is the ability in those circumstances for young people to get a waiver, an exemption and to be considered in that context in relation to their particular circumstances. I am pleased with that because, as I said, it was certainly a concern raised by youth workers in my electorate.

Having said that I believe that those people, some of the most vulnerable young people in our community, are the ones we should be helping the most to overcome the personal circumstances that they are facing, whatever they may be, so that they can earn qualifications and become someone who has self-esteem, who believes that they can go out and compete in the workforce like any other person and have new skills and the confidence to get a job, and to have the quality of life that every person in this country deserves to have. For all of those reasons I commend this bill to the House.

Craig Thomson (Dobell, Australian Labor Party) Share this | Link to this | Hansard source

Last week I was able to attend the launch of a very positive initiative put together by group training and registered training organisations which operate in my electorate of Dobell on the Central Coast of New South Wales. This particular initiative was called Adopt an Apprentice program and aims to find new employers willing to take on apprentices who have unfortunately lost their places with other small businesses because of the economic downturn or through similar circumstances. At the launch of the program the future was looking brighter for 20 job seekers who formed the target number under this program. Out of the 20, five places had already been found as the program was being launched, so there were already five apprentices with new employers.

The fact that employers are willing to take on young apprentices who have had to be put off elsewhere is largely because these job seekers already have some training, experience and skills. Also the truth is that these young people are ready and willing to work. They have confidence because they have shown up to their workplaces. Their employers and work mates have supported and encouraged them. Their confidence came through being backed up by skills learned and training received while on the job. They are ready to try again with a new employer; someone who is willing to take on a keen young person, who, in turn, wants to get ahead with his or her apprenticeship and reach the goal they set out to achieve at the start, and that is to be trade qualified.

One of the registered trainers at the launch raised concerns about the lack of apprentices generally in the workplace. The man was in his 50s and had worked at Garden Island with over 400 apprentices in various trades working around him when he was a young apprentice. He reminisced about a time when there were many opportunities, and he said that the program that they were launching on the Central Coast was in some small way going to make sure that the apprentices who were in the system could complete the training they needed and acquire the skills required for the economy that we have on the Central Coast. We need to give our young people job skills for the future. Without this sort of investment we will find ourselves in a hole in a few years time, with a drastic lack of skills.

Such neglect for future needs happened under the previous government and we must not let it happen again. We must be in a position to make sure we continue to train new young people and encourage them to take on further training so that as the economy comes out of the global recession we have the necessary skills to make sure that the economies both locally and on the Central Coast can take advantage of those skills. When the economy recovers we will have in place a better skill base for our young people to help them get ready for the workforce. Setting that up, especially in places such as my electorate, is absolutely vital. On the Central Coast, according to the last available figures, youth unemployment reached around 37 per cent. I am speaking about an area where these types of programs are absolutely essential. We have always had high youth unemployment, but with the global financial crisis we have seen it rise in the last six months from just over 25 per cent to just over 37 per cent. That is why I am supporting the Social Security Amendment (Training Incentives) Bill 2009. It is vital that this sort of training be introduced and that these incentives be given so that young people in my area can get a fair shake.

The bill introduces a new training supplement to assist low-skill job seekers receiving Newstart allowance or parenting payment to undertake approved training. This will in turn support better employment opportunities for those job seekers. The bill will assist low-skill job seekers with the costs of participating in training or further education which may assist them to secure employment in the future. The bill will encourage more young people to gain the education and skills they need to move into further education or employment, recognising that youth with limited education are particularly vulnerable to becoming unemployed in the long term. The changes will be mirrored in changes to family tax benefit A proposed to commence from January 2010. These changes will proceed separately.

Any opportunity for job seekers is vital, especially in regions such as mine, the Central Coast, where young people have constant difficulty in finding work. Not only do we have 37 per cent youth unemployment but 30 per cent of the workforce commute to Sydney every day when they would prefer to work on the Central Coast. This initiative supports the government’s commitment to improve the educational attainment level of Australians by encouraging completion of year 12 or equivalent and a commitment to unemployed Australians to provide improved access to education and training opportunities through Job Services Australia and the Productivity Places Program.

The training supplement will be available to Newstart allowance and parenting payment recipients who have not completed year 12 or who have a trade or vocational qualification that could be upgraded to better equip them to find future employment. Job seekers meeting these requirements will receive an extra $41.60 per fortnight if they fully meet the activity test or participation requirements by undertaking approved training or further education at the certificate II or certificate III levels. The training supplement will be available for people commencing approved training between 1 July 2009 and 30 June 2011. The training supplement will be available under any approved training commenced in this period when it is completed. It is estimated that over 50,000 low-skill job seekers will be assisted over this period.

The New South Wales Central Coast, as well as having high youth unemployment, has very low school retention rates, well below the benchmarks set at both national and state levels. In fact, less than 50 per cent of people attending school complete year 12. The object of this bill is to encourage young people to remain in education and training until they have completed year 12 or equivalent so they can improve their employment prospects and are equipped to find jobs as the economy improves. These changes support the youth compact and the national youth participation requirements agreed by COAG on 30 April 2009. This measure will also assist in bringing forward the COAG target of 90 per cent year 12 or equivalent attainment from 2020 to 2015. As you can see, on the Central Coast we have a long way to go when we have an under 50 per cent completion level at the moment and want to meet 90 per cent by 2015. It is only by having the government take action in these areas, through bills such as this, that there is some chance of that actually occurring.

Youth allowance will be payable to young people without year 12 or an equivalent qualification if they study full time or if they comply with the youth allowance employment pathway plan, which requires 25 hours a week in a combination of part-time study or training, in combination with other approved activities. These requirements will apply until the young person attains year 12 or equivalent certificate level II qualification. Exemptions will apply where no training is reasonably available or the person does not have the capacity to undertake the training that is available. These amendments will apply to new applicants for youth allowance from 1 July 2009. The requirements will be progressively implemented for existing youth allowance recipients without year 12 or the equivalent between January and July 2010.

The main points of the bill are the following. The training supplement is an additional, time limited, payment of $41.60 per fortnight to help eligible job seekers who participate in approved study or training. It will be available for courses commenced between 1 July 2009 and 30 June 2011. The government is introducing this payment to encourage and support low-skilled income support recipients with the costs of undertaking training or further education to assist them to secure employment in the future. The training supplement will assist job seekers receiving Newstart allowance or parenting payment who have not completed year 12 or the equivalent or who have a trade or vocational qualification which could be upgraded to better equip them to find future employment.

Job seekers will need to participate in approved education or training to receive the training supplement. For some people this may mean full-time study. Others, such as people with a partial capacity to work, would meet their participation requirements through part-time study. The sorts of approved courses that people will need to do include certificate II to certificate III courses which can be approved. Generally courses would run for at least one semester and can be up to 12 months in duration. People wanting to do a course for longer than 12 months may be eligible for student income support payments. The reason why the training supplement is time limited is straightforward enough: the training supplement will be available for two years to provide an enhanced incentive for job seekers to gain skills and qualifications during the global downturn. This makes sure that we do not have a generation that is forgotten because of the global financial crisis.

We need to be making sure that not only are we stimulating jobs through the decisive action the government is taking with the stimulus packages but also that those young people are being equipped with the skills necessary to participate in the economy as it comes out of recession—that they are not being left on the scrap heap, that they are given the opportunity to train and retrain. Job seekers who participate in the Productivity Places Program will not have to pay for their course. However, not all courses taken up will be provided through the Productivity Places Program. Some may be through a state or territory subsidised TAFE or RTO place. In such cases, normal course fees will apply. As is currently the case, these course costs are the responsibility of the student. In addition to the assistance provided by the fortnightly training supplement, over the period 1 January 2009 to 30 June 2010 recipients of Newstart allowance and parenting payment who undertake approved study or training are also eligible for the education entry payment of $208 and the $950 education entry payment supplement of the Training and Learning Bonus.

Looking at the training places, the entitlement to an education or training place is for any government subsidised qualification. Training places will come from a range of existing sources, including the Australian government’s Productivity Places Program. This program is providing 711,000 training places over five years to ensure that Australians develop the skills that they and industry need. Of these, 319,000 places, including 20,000 places for workers who may need to be re-skilled, are for job seekers; and 392,000 training places are allocated for existing workers wanting to gain or upgrade their skills.

As part of the Compact with Young Australians, young people under 20 who are working up to 15 hours per week will be eligible for Productivity Places Program training places. For this program to work, some changes will have to be made. From 1 July 2009, young people seeking youth allowance without year 12 or equivalent will be assessed against new participation requirements. Under these new requirements, to receive youth allowance young people under 21 years of age without year 12 or equivalent will need to: participate in education and training full-time; or participate full-time—that is, generally for at least 25 hours a week—in part-time study or training, in combination with other approved activities, until they gain a year 12 all equivalent certificate level II qualifications. Young people already receiving youth allowance who do not have year 12 or equivalent qualifications will make the transition to the new requirements between 1 January 2010 and 30 June 2010.

It is fair to remind the House why the government is making these changes. Part of the reason is that the changes support the youth compact and National Youth Participation Requirements agreed by COAG on 30 April 2009. Looking closely at these time frames, the changes will apply to all young people without year 12 or an equivalent qualification claiming youth allowance from 1 January 2009 and to existing youth allowance recipients without year 12 or the equivalent who are not full-time students from 1 January 2010. In order to allow young people already receiving youth allowance time to consider their options, the new requirements will be progressively implemented for this group between January 2010 and July 2010.

Going over the requirements for young people who obtain year 12 or the equivalent qualification, the existing Youth Allowance participation requirements will continue for 21-year-olds who have received year 12 or the equivalent qualifications. This group of young people is not affected by the measure. The question has been raised that the new participation measures might punish disadvantaged young people. Past economic downturns have demonstrated that young people with limited education and skills are particularly vulnerable to long-term unemployment. They struggle to find employment even when the economy recovers.

The arrangements will be flexible for young people with complex needs. For example, young people with multiple barriers such as homelessness or substance abuse issues who would qualify for stream 4 under Job Services Australia arrangements will meet their requirements by participating in this service stream. Similarly, young people with a partial capacity to work will have their hours of participation tailored to their assessed capacity. If eligible, they can also meet their requirements by participating in disability employment services. The range of existing activity test exemptions based on personal circumstances, such as temporary medical incapacity or major personal crisis, will continue to be available. This will ensure appropriate safeguards are in place to cover periods that young people cannot participate.

It is also useful to clear up any concerns about the availability of education or training places. As part of the COAG youth compact, state and territory governments have committed to immediate action to ensure sufficient school and training places are available to young people aged 15 to 19, who will have an entitlement to an education or training place for any government subsidised qualification. This commitment will be fully implemented by 1 July 2009. Enrolments will be subject to admission requirements and course availability. In addition, young people aged 20 to 24 will have an entitlement to an education or training place for any government subsidised qualification which would result in the individual attaining a higher qualification. The commitment to 20 to 24-year-olds will be fully implemented by 1 January 2010. Enrolment will be subject to admission requirements and course availability.

State and territory governments will work with their education authorities and training providers to make arrangements for determining eligibility for an entitlement place. It is anticipated that most places will be provided by TAFEs and some by private registered training organisations offering government subsidised qualifications. Commonwealth, state and territory governments will also work with training providers to address issues relating to the provision of places in rural and remote locations. Exemptions will apply in cases where there are no locally accessible training courses or appropriate distance education options. Job Services Australia providers will also have the capacity to help young people gain access to education and training programs to improve their skills, including places in the government’s Productivity Places Program.

Deputy Speaker Adams, you can see through this bill that the government is committed to helping young people who might not have the best chances of gaining long-term employment gain the necessary skills to give them a better chance. It is aimed at those young people who have not completed year 12 or the equivalent, or who have a trade or vocational qualification which could be upgraded to better equip them to find future employment. The budget announcement for this measure stated that the changes to participation requirements for Youth Allowance are to come into effect on 1 January 2009 for new claimants without year 12 or the equivalent and from 1 January 2010 for existing recipients without year 12 or the equivalent. Budget announcements also stated that the training supplement would commence from 1 July 2009. For young Australians hoping to upgrade their skills—such as from electorates like mine, with 37 per cent youth unemployment and less than 50 per cent of people going on to year 12—the opportunities provided by this legislation cannot be overstated. It is vitally important that there are no delays in this legislation. I commend the bill to the House.

Jason Clare (Blaxland, Australian Labor Party, Parliamentary Secretary for Employment) Share this | Link to this | Hansard source

I thank all members for their contribution to this debate. The Social Security Amendment (Training Incentives) Bill 2009 is part of the government’s strategy to keep Australia working and set us up for the future. It creates new incentives to train and learn, to help young people now and to make sure we have the skills we need as the global economy recovers. Unemployment is the biggest challenge we face. It is the biggest challenge governments face all round the world. In America, unemployment has almost doubled in the last 18 months and now stands at 9.4 per cent—the highest it has been in the last 25 years. Australia is doing better than most. Unemployment is lower here than in any other major advanced economy bar Japan, but there is a tough road ahead. Unemployment is projected to rise.

When workers lose their job it does not just hurt the individual and their family, it hurts our economy. We lose skills and experience—the skills and experience that we need to come out the other side of the global recession stronger and more competitive than before. We cannot stop the global recession hitting us, but we can reduce its impact. That is why the government is rolling out 35,000 job sites across the country over the next 12 months, providing tax breaks to small business and introducing this legislation, which is part of the Jobs and Training Compact announced by the Prime Minister in April this year.

The bill before us does two things. First, it introduces a temporary training supplement. This payment will be made to people who are amongst the most vulnerable to long-term unemployment: recipients of Newstart and the parenting payment who have not completed year 12 or an equivalent qualification or those who have a trade qualification that needs to be upgraded. The training supplement of an extra $41.60 a fortnight will be made to Newstart and parenting payment recipients without a year 12 or an equivalent qualification who start an approved course of study or training between 1 July 2009 and 30 June 2011. It is estimated that 50,000 people will benefit from this. Second, the bill changes the participation requirements for youth allowance (other). To obtain youth allowance (other), young people without year 12 or equivalent qualification will now need to participate in education and training. The purpose is to encourage young people to remain in study or training until they complete a basic educational or training qualification—to make sure young people are learning or earning.

The logic behind these reforms is simple. Unemployment hits some communities and some groups harder than others. Young people and workers with low skills are particularly vulnerable. Since September last year unemployment amongst young people aged 15 to 24 has grown at a faster rate than it has amongst the rest of the population. The more skills and education people have, the more likely they are to be employed and the more they are likely to be paid. The former Minister for Employment Participation made this point in his second reading speech:

By age 24, only seven out of 10 young people without a year 12 or certificate III or IV qualification are in further training or employment. By contrast, nine out of 10 young people with such a qualification are in further training or employment.

In other words, skills count. Qualifications are important. The lesson from the recession of the early nineties is that youth unemployment rises quickly and can take a long time to fall. Then, one in three young people who had not completed year 12 were unemployed. They were three times more likely to be unemployed than someone who had completed year 12. These are the facts.

The long-term consequence of this is entrenched disadvantage. Long-term unemployment has a devastating impact on individuals and on families. It also has a long-term impact on the productivity and competitiveness of our economy. That is why this bill is important. It is part of a comprehensive strategy to reduce the risk of long-term unemployment and build the skills that we need to compete in a world beyond the global recession; to keep Australia working. I commend the bill to the House.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.