Tuesday, 2 August 2022
Social Security and Other Legislation Amendment (Self-Employment Programs and Other Measures) Bill 2022
I too rise to speak on the Social Security and Other Legislation Amendment (Self-Employment Programs and Other Measures) Bill 2022. This bill seeks to update the Social Security Act 1991, the Veterans' Entitlements Act 1986 and the Family Law Regulations 1984 to provide clarity and consistency in our laws regarding the new Self-Employment Assistance program.
The Self-Employment Assistance program, which started on 1 July this year, replaced the New Enterprise Incentive Scheme. Labor is very proud of its history with this program. Labor recognises that small businesses are a vital part of our economy. We know that there are over 2.4 million small businesses actively trading in Australia today and that they employ almost five million workers. The development of small business is also an alternative to traditional employment for so many Australians that can provide secure work and financial independence if people are supported with programs like this, while also supporting Australians to use their skills that might not otherwise be recognised by traditional employers to still succeed. That is part of the role of small business as an alternative to traditional employment for many people.
Successive Labor governments have supported and encouraged the development of small business in Australia, and the New Enterprise Incentive Scheme is just one example of that. The scheme was introduced by the Hawke Labor government way back in 1985 to help unemployed Australians create their own employment opportunities, and it's been running for 37 years. Over the course of those 37 years this scheme has helped almost 200,000 Australians to start and run their very own small business.
Before this scheme's creation, before it came into effect, when someone started a small business they would cease to be eligible to access income support, and that acted as a barrier to those who otherwise would have sought to take on a small business venture and create their own employment opportunities. So, to incentivise those who were unemployed to create a small business, the Hawke government launched a trial of the New Enterprise Incentive Scheme, offering participants an allowance in line with their income support entitlement; providing small-business training, with courses designed for participants to learn foundational business skills and develop business plans; and, as well, providing 12 months of personalised mentoring to support those participants to create their very own viable business. Later, in 2012, this scheme was expanded to include participants of disability employment services. It supported Australians with a disability to develop a small business, giving them the flexibility and financial independence of self-employment.
The educational and mentoring support included in this scheme has also been extended to those not on income support to encourage more Australians to start viable small businesses. In the last few years eligibility for the scheme has also been expanded to veterans transitioning out of the Australian Defence Force, giving them access to training while they are still employed. It has also been expanded to support part-time businesses, assisting those with part-time employment or, for example, caring responsibilities. These really important expansions have increased participation in the New Enterprise Investment Scheme. In fact, it's women who have made up 53 per cent of participants in the scheme over the past several years, and people with a disability make up almost 20 per cent. Great outcomes have been delivered for these participants, and we can see that in some of statistics on the success of the program. Eighty-two per cent of participants remain in employment three months after they exit the program, and almost 70 per cent are still running their businesses.
Strong demand for this program emerged during COVID, when fewer traditional jobs were available and many jobseekers were looking to self-employment through starting a small business as the way forward during very difficult times. The scheme also helped many businesses pivot to deliver services in new and innovative ways to remain viable, really demonstrating the key role that government can play in helping businesses adapt in uncertain times.
On 1 July this year the scheme I've been describing was replaced with the new Self-Employment Assistance program. This new program builds on the success of that Hawke government legacy dating back 37 years to 1985. With a budget of over $840 million over five years, the program will continue to support Australians to start and run small businesses, which will create jobs, grow our economy and improve labour market outcomes.
The new program allows eligible people interested in self-employment to receive free help to generate and validate business ideas, allowing them to make really well informed decisions about whether self-employment is actually a good fit for them and, potentially, for their families. The expanded program will provide additional services that will be tailored to participants, allowing them to choose the supports that they need—the supports that really suit them in the small business that they would like to set up. These are supports such as free accredited training, business plan development, business advice sessions and business health checks. And business mentoring and advice will be available for eligible business owners who have only recently started trading or who need assistance to adapt their business and their business model in our changing economic environment.
The Self-Employment Assistance program retains the successful components of the New Enterprise Investment Scheme while introducing changes to small business and entrepreneurship services to make them more flexible, and improving access for jobseekers and microbusiness owners. This bill will ensure that the same supports available under the former scheme will continue to support participants of the Self-Employment Assistance program, making clear in our laws that the previous provisions for payments apply equally to the payments under the Self-Employment Assistance program. That's very important to providing clarity for participants while they support themselves to establish their new businesses.
We recognise that this program has supported Australians to gain flexibility and financial security through self-employment, and we recognise that self-employment is a viable pathway for Australians to move off income support, earn their own income and contribute to their communities. But of course we also know that starting a small business takes a lot of time and requires a lot of support, particularly financial support. Labor is committed to supporting and fostering self-employment opportunities for small businesses for people who want to start their own small business. We understand how critical small businesses are to our economy. I must say that it was a pleasure to follow Senator O'Neill in my comments; she has been such a champion for small business in this country. I echo the comments that Senator O'Neill made, and the passion that she demonstrated for our government to show support to people to really pursue their dreams in setting up their own small business.
Like Senator O'Neill, Labor is committed across the board to supporting and fostering people's small business opportunities. We know that small business is critical—across the economy but also in particular to local communities, and, as Senator O'Neill said as well, particularly in regional communities. They make up 98 per cent of all businesses in our country and employ around 41 per cent of the business workforce. Small businesses are in every part of the country, in every industry and in every region around Australia. So often small business is the real backbone of local communities.
The New Enterprise Investment Scheme is a legacy of the Hawke Labor government, and it is really such a strong sign of the work that this parliament can do when we work together in a bipartisan fashion to support good programs. We have a legacy here with this program; it has lasted for over 37 years and through 14 parliaments. That's the sort of change that Labor governments can deliver for Australians and that Labor governments will continue to deliver for Australians: lasting change, change that helps people not only to keep their heads above water and to survive but actually to thrive—to thrive in their businesses and in their communities.
This is a program that we're so proud of because it supports people to upskill and re-skill, and it gives them the tools to be successful. It supports Australians to find secure work, whether that's in a traditional employment setting or whether it's through self-employment. Our government will maximise small-business participation in Commonwealth procurement, and use our purchasing power to also support small business through those procurement measures. We believe in delivering better value for money, growing our local economy and providing greater opportunities for business to create more, better and more secure Australian jobs.
Our government will help address skills shortages that are affecting small businesses, through fee-free TAFE and our cheaper childcare policy. We're committed to removing barriers to getting people into the workforce, as well as barriers to those who want to return to work. The Albanese government is delivering a better deal for small business by listening to people's needs, reviving genuine collaboration between small business and government, and drawing on Labor's history of working with unions, workers and industry to deliver better outcomes for all.