Tuesday, 10 February 2009
Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009; Appropriation (Nation Building and Jobs) Bill (No. 2) 2008-2009; Household Stimulus Package Bill 2009; Tax Bonus for Working Australians Bill 2009; Tax Bonus for Working Australians (Consequential Amendments) Bill 2009; Commonwealth Inscribed Stock Amendment Bill 2009
The Greens are responding to the global financial crisis with an eye on the longer term. We want to ensure that the massive resources we put into an immediate economic stimulus are not just a flash in the pan, that the money we are pumping out is in fact building and supporting the development of a truly sustainable and robust green economy, not just providing a short-term cash boost. We need to be thinking about and working towards a resilient, sustainable, more crash-proof economy to underwrite the future prosperity and wellbeing of all Australians. As governments around the world rush to respond to the global financial crisis, many are talking about building the new green economy of the future and a greener society and advocating for a green New Deal, but there is growing concern that, in our rush to respond quickly to the immediate crisis, we are painting ourselves into a corner.
We are committing large amounts of resources to fending off a global financial crash, and, while we are not arguing against the need to do this, we believe there is a real risk that, once these resources are spent, more will be hard to come by. We can expect to experience a protracted economic downturn during which our capacity to dedicate resources to tackling other problems and investing in industries of the future will be severely limited. As I understand it, there has been a very recent meeting of UNEP in New York, where they were discussing this very issue and also discussing the green New Deal. The world’s leading thinkers are putting their minds to how we best tackle the combined threats of a global recession, global warming, population and peak oil. They are extremely concerned that, in spending trillions of dollars in responding to the global financial crisis, the nations of the world are getting themselves heavily into debt—a debt that will be hard to repay during a downturn and which is likely to reduce the capacity of the world to invest in new initiatives for a decade or more. This means that, in spending precious resources at this time, we need to look for those things that will both provide an immediate stimulus and future-proof Australia. We believe we can best do this by directing these resources at these emerging problems—in other words, we can manage to address both issues.
With these concerns in mind, the Greens believe we need to look at some key criteria when we look at our responses and our investment. We believe we need to be looking at equity, sustainability and impact. Equity means that we should be making sure that our efforts are targeted at helping those who are hurting most, that all Australians get a fair go and that those who are already socially excluded do not end up even worse off. We believe we also need to look at impact. This means we should be putting money into initiatives that will have an immediate, measurable impact. We should invest in effective fiscal stimulus measures that deliver value for money, protect jobs in the sectors most threatened and create real jobs that will continue beyond the life of the stimulus package in the long term.
We also need to look at sustainability. This means ensuring that we are investing in the future, targeting areas where we can steadily grow the new green economy of the 21st century and beyond—a resilient and shock-proof economy that is not dependent on running down our resource base and stealing from future generations. Senator Milne has already spoken about environmental sustainability, renewable energy use and the low-carbon economy, all of which we believe can and should be addressed in this stimulus package.
I want to expand on the other side of the equation and look at social sustainability. This government came into power with a strong commitment to social inclusion and social justice, and we believe that they need to be addressing those also through the stimulus package. Too often our analysis of economic issues focuses on the dollars alone as if money and the economy had a life separate from the people who make up our society. As part of the committee inquiry into this package the church groups submitted a report from Access Economics. The first paragraph of the conclusion of the report said:
Despite a period of sustained economic growth in Australia, acute pressures have mounted on certain parts of the community. Australia’s two-speed economy has seen divergences in incomes across sectors, across states and across different parts of the income distribution. Evidently, Australians have not shared equally in the nation’s recent economic prosperity.
Even prior to the current global economic crisis and in the middle of what was termed an economic boom, many of our social service agencies delivering frontline services to people in crisis were reporting disturbingly high levels of unmet need for essential support services including residential aged care, housing and homelessness, family relationship centres, emergency relief and financial counselling. The Access Economics report to which I just referred reported that major church providers indicated—and this was also indicated in the Senate inquiry yesterday—that during 2006-07, prior in fact to the earliest indicators of the global financial crisis, service providers had turned away 77,000 eligible Australians seeking their support. This was before the global financial crisis.
These already stretched services are now being strained to breaking point by the impacts of this latest crisis. In recent months service providers have reported a doubling of demand for emergency financial services across the board, with this demand quadrupling in some areas. Last year, for example, one service provider in my hometown of Perth reported that they had to turn away a staggering 1,778 people seeking emergency relief and financial counselling support in just that one year. Since then the service reports to us that the demand has grown substantially.
In a time of crisis we need to make sure that we have an effective social safety net, and right now, unfortunately, that net is full of holes and is not up to the task. The Greens believe that investment in sustainable social services is a necessary and integral part of any economic stimulus package. In the short term we believe that there should be a focus on quickly scaling up and boosting the capacity of existing services to meet the unmet need and growing demand in the high-demand and high-risk areas. That is why we support the community service organisations’ call for an initial investment of $300 million in supporting social services.
In the medium term we need to identify areas of emerging need and developing targeted services, and in the longer term we need to address regulatory reform to cut through the red tape and make sure that any one service does not have to manage a huge stack of different grants, contracts and reporting requirements. Yesterday Catholic Social Services at the committee inquiry reported that a survey they did showed that 19 organisations had over 600 contracts for service delivery. It is ridiculous. We need to ensure that we are paying the real cost of service delivery so that we are not running down our social infrastructure, as we unfortunately did under the previous government.
To address the areas of emerging need we should be revisiting the work of Tony Vincent on the poverty postcodes and commissioning him or others to rapidly assess the impacts of the financial crisis with a view to identifying those areas of growing and emerging need. Where things are getting worse in particular poverty postcodes, targeted investment is needed in those areas. We also need to look at what is emerging as the ‘crash codes’. These are the areas that are likely to be strongly impacted by the economic downturn and where, unfortunately, perhaps at this stage we do not have the kinds of support agencies and services that are needed to address the crisis they are facing. It is likely that the crash codes will be some of those areas that score highly on the measures of housing unaffordability and housing stress, and again this was highlighted in the committee inquiry yesterday by the community service organisations.
We believe that the idea put forward by the Australia Institute in their submission—that we need to invest up to $1 billion into supporting our social services—has merit and deserves consideration, and the community service organisations’ call for $300 million would be a good down payment on this. We believe that the government also needs to be looking at additional incentives to help this sector in the forthcoming budget.
The Greens believe that the government should be targeting its promised infrastructure investments in those areas of highest and emerging needs. For example, we think that they need to be innovative in where they are building primary schools by perhaps considering these areas as community hubs or, as Frank Quinlan from the Catholic Social Services referred to them, as ‘social service shopping centres’. These are places where community services could have a proper office and meeting space and not just have to meet in an empty multi-use hall, for example. This would allow them to bring wraparound, easily accessed services to families. This is an idea that was supported by the 2020 Summit and we believe that it is a good way to start thinking about being innovative in our approach to the delivery and funding of social services.
The Greens believe that government investment during these tough times also needs to target support to those who are suffering the greatest impact. When it comes to the threat of unemployment, for example, of course prevention is obviously the best approach. If we can keep more people in their jobs then there will be less impact on our social safety net, on the housing market and on the strength of the economy. If it costs us the same amount of money to keep someone in productive employment as it does on Newstart allowance then surely the better approach is to help them to continue to play a productive role in the economy, delivering the goods and services that keep the engine of our economy ticking over or, as Senator Milne referred to in her second reading speech, providing community support services such as looking after our natural environment and our national parks or carrying out natural resource management projects.
We should also be looking seriously at entry payments and ongoing job subsidy programs for employers in key industries, especially those that are part of building our emerging sustainable technologies and industries of the future. That is the kind of double-value investment that gives us more bang for our buck. However, there will be increasing numbers of people losing their jobs and needing to access Newstart—and, unfortunately, Newstart is no longer the safety net that it used to be.
For many years, the Greens have been the lone voice standing up for a fair go for disadvantaged Australians, including those who are unemployed. It is time to finally get rid of the myth of ‘dole bludgers’ and ‘the undeserving poor’. This was fostered by the previous government, and unfortunately the current government has not done enough to counter this myth. Many of the government’s ‘working families’ are now, through no fault of their own, facing a period of unemployment and the very real threat of sliding into poverty. For these families, the reality of the pitiable Newstart allowance is going to be a very huge shock. For single people, Newstart is only $224.65 per week; for singles with children, it is $243 per week. For those on the single age pension, it is $281.05 per week.
I expect that many people who will soon be facing the reality of unemployment will also have to face the reality of how they deal with living in poverty. As this awareness spreads, there is a significant and growing group of voters whose attitudes to social security and income support are rapidly shifting, and we believe there is a growing call for the government to fix this most essential of safety nets. The Greens believe it is in the interests of the economy and a matter of basic social justice that we cushion the blow for these working families and that we provide a fair go and a decent standard of living for all Australians, including those who, unfortunately, are unemployed. Even with a very narrow economic focus, if we are concerned about the capacity for our economy to recover from an economic downturn then we do not want skilled workers to be dumped into financial stress and family crisis such that they are overwhelmed by poverty and despair and in no position to play a role in the economic recovery when there is an upturn in the economic cycle—nor do we want them to fall into the vicious circle of long-term unemployment.
Again, this issue is addressed by the Access Economics report submitted to the committee inquiry into these bills. It highlights what happened in the early nineties when people found themselves unemployed—and, unfortunately, the numbers in long-term unemployment grew very substantially. We feel that the measures provided in the stimulus package are not adequate to deal with the issues facing the unemployed and do not give enough support to those on unemployment benefits. The Australia Institute recommend that the base rate of Newstart should be increased by $56 a week for singles. They also address the issue of liquid assets. Under the previous government, the level of liquid assets that you could hold moved from $5,000 to $2,500. So we could potentially see people who find themselves unemployed having to run down their fairly scarce assets before they can access unemployment benefits. We believe the government needs to address this issue. There is also the issue of allowable assets. Although a home is not counted as part of those, there is very strong concern that, because there is a difference between the asset test for the unemployed and the asset test for pensioners, the current asset level will again mean people will slide into poverty before they can start accessing Newstart support.
There is an issue around the education entry payment; we believe there is an inequity in the package in that those on unemployment benefits are the only group for which the one-off payment is conditional. Treasury were unable to answer my questions last night about who was really eligible under this provision in the package, how many of those who are currently unemployed will be able to access the $950 for training and who will be providing this training. Treasury were also unable to answer questions about the capacity in the sector to provide that training. Also at the committee inquiry hearing yesterday, the community services sector expressed concern about the capacity of the job service provider sector to provide the training. In fact, it was also indicated that many of these service providers’ contracts finish in June and they do not know if they will have a contract as of July. This is deeply concerning given the expected increase in the numbers of people facing unemployment. The package could also, we believe, have addressed the forthcoming—or almost here—crisis in aged care, with the lack of places in residential aged care. We could also be providing additional resources to community care, for example.
One group of people that has substantially missed out on the economic stimulus package is Indigenous Australians. There is growing concern in the community around the cancellation of the CDEP scheme as of 1 July and the transfer of people in that scheme onto Newstart. We welcome the investment that has been made in converting some of the existing CDEP jobs into proper wages—I will not say ‘supporting them into real jobs’, because it is obvious that they were doing real jobs at the time, some of which they are now being paid proper wages for. It makes no sense, at a time of rising unemployment, to be moving Aboriginal people out of CDEP jobs, where they are gainfully employed building infrastructure or delivering community services, and onto the dole queue.
It makes more sense to revamp CDEP so that those for whom there is no employment during the economic downturn can be doing something more constructive, such as improving their skills, maintaining their self-esteem and staying in contact with the culture of work. We urge the government to reconsider their current planning for CDEP and to invest in the future of Aboriginal Australians who also desperately need support during this growing financial crisis.
In delivering an immediate economic stimulus it makes sense to target low-income earners—those whose credit is limited, who are struggling to get by and who are thus more likely to spend money immediately on the means of day-to-day life rather than on frivolous luxuries that are more likely to be overseas imports. The Greens are looking to deliver a sustainable and forward-looking stimulus. We need to ensure that we are investing in quality social infrastructure and are thinking of a future where the jobs that we provide are sustainable and where we ensure that everyone in our community is looked after.
Unfortunately, this package, despite the government’s promises, does not address the needs of the unemployed. It is not providing enough. We cannot expect Australians to survive on $224 a week, which is what Newstart currently is. For too long we have been demonising Australians who cannot find work. Unfortunately, there will be a growing number of people who will face unemployment queues. Are we going to stand by and let them struggle and slide into poverty and to be forced to sell their houses, which will create even further downward pressure on the housing market and homelessness, or are we going to be forward-looking and provide the support they need? (Time expired)