Christian Porter (Pearce, Liberal Party, Minister for Social Services) Share this | Link to this | Hansard source

I move:

That this bill be now read a second time.

This bill seeks to end compensation for a carbon tax that no longer exists by closing the energy supplement to new welfare recipients. The government is committed to ensuring that Australia's welfare system provides appropriate support to those in need whilst also remaining sustainable for future generations. The government therefore does not consider it appropriate to continue to compensate people for a tax that no longer exists.

The carbon tax was repealed from 1 July 2014. Had the carbon tax not been repealed it would have caused long-term increases in electricity prices. Indeed, electricity prices more than doubled under the previous government between December 2007 and September 2013, and when the carbon tax was repealed on 1 July 2014 the ACCC estimated annual savings of between $46 and $263 in residential electricity costs alone.

The concept of ending compensation for a tax that no longer exists has already been agreed to by the parliament through the passage of the Budget Savings (Omnibus) Bill 2016. As a result of the Budget Savings (Omnibus) Act 2016, carbon tax compensation has already been closed to new recipients of FTB A, FTB B and the Commonwealth seniors health card from 20 March 2017.

Under the bill that I introduce today, the energy supplement will be closed to new income support recipients, from 20 September 2017.

People who have been in the income support system continuously since 19 September 2016 will continue to receive the energy supplement. Existing recipients will continue to receive the payment as long as they have remained continuously eligible from 19 September 2016 for an income support payment that attracts the energy supplement. From 19 September 2016, if an existing recipient transfers, or has transferred, directly from one income support payment attracting the supplement to another, without a break in entitlement, they will continue to receive the energy supplement applicable to their new payment.

There will be transitional arrangements in place for people who have entered the income support system between 20 September 2016 and 19 September 2017. These people have and will receive the energy supplement temporarily during that period, as long as they remain eligible for an income support payment, but will no longer receive the supplement from 20 September 2017.

This measure was previously introduced in the Social Services Legislation Amendment (Omnibus Savings and Child Care Reform) Bill 2017. The Social Services Legislation Amendment (Omnibus Savings and Child Care Reform) Bill 2017 was reviewed by three different committees within this parliament.

I thank the Senate Community Affairs Legislation Committee for its report on the measures that were contained in the Social Services Legislation Amendment (Omnibus Savings and Child Care Reform) Bill 2017 and for its recommendations. The report was published on 21 March 2017 and I note that the committee recommended that the bill be passed. The committee considered that the changes to Australia's welfare system would better target government payments whilst still providing a fair and reasonable safety net for those who need it. The committee also noted that the measures in the Social Services Legislation Amendment (Omnibus Savings and Child Care Reform) Bill 2017 would encourage and support greater workforce participation for those who have the capacity to work and would therefore ensure that Australia's welfare system is sustainable in the future. For these reasons, the government supports the measure being introduced today, that was previously introduced in schedule 9 of that bill to which I have referred.

The government will continue to prioritise energy security and affordability. The 2017-18 budget includes a $265 million energy package that will ensure Australia maintains a secure, reliable and competitive energy system into the future. Amongst a range of measures, it provides funding to expand gas supply, makes finance available to build a solar thermal plant and provides additional funding for the Australian Energy Regulator to scrutinise energy providers to ensure they are serving consumers' needs.

The government has also directed the Australian Competition and Consumer Commission to review electricity retail prices. The review will examine the competitiveness of offers available to households and businesses to make sure they are paying no more than necessary. A preliminary report is due by 27 September 2017 and a final report due 30 June 2018.

The Turnbull government will start work on an electricity game-changer: the plan for the Snowy Mountains Scheme 2.0. This unprecedented expansion will help make renewables reliable, filling in holes caused by intermittent supply and generator outages. It will enable greater energy efficiency and help stabilise electricity supply into the future. This will ultimately mean cheaper power prices and more money in the pockets of Australians.

Gas-fired generation is also an important part of our electricity system. The higher the price of gas the higher the price of electricity. That is why the government is also taking action to put downward pressure on the price of gas by expanding supply. The government is putting in place an export control mechanism to ensure Australians have access to gas at a fair price and calling on the states and territories to lift their moratoria to allow for more supply.

The repeal of the carbon tax and the actions this government is taking to put downward pressure on electricity prices will ensure that new welfare recipients are provided appropriate support without the ongoing need for compensation for a tax that no longer exists. I note that those opposite adopted this very policy in their election costings in 2016, and I seek support for the passage of the legislation or, at the very least, appropriate explanations to the Australian people for the additional billion dollar black hole that would occur in the budget of those opposite. I commend the bill to the House.

Debate adjourned.