Slade Brockman (WA, Liberal Party) | Hansard source

I too rise to speak on the Social Services and Other Legislation Amendment (Strengthening the Safety Net) Bill. Before I get to the detail of this particular bill, I just want to start with some of the economic fundamentals because we do face a very challenging economy at the moment, and, sadly, we have a government that does not seem to have a clue as to how to deal with those economic challenges. The biggest challenge we face is of course inflation. Inflation is a destroyer of wealth. It is a destroyer of peoples livelihoods. It reduces an individual's ability to improve their lot in life. It crushes families. It crushes small business. Inflation is the biggest economic challenge we face.

In my home state—and I know this is replicated elsewhere as well—we see union demands for pay rises that will only exacerbate the inflationary challenge we face. In one case in Western Australia, a 25 per cent immediate pay rise is being demanded; in another case, it's 12 per cent over two years, including seven per cent immediately. If these sorts of pay rises were accepted by anyone in power, they would add to the inflationary pressure that's already in our economy and they would flow through to other sectors and risk a wage price spiral. That is not something that is completely out of the question, sadly. For those who are old enough to remember the last wage price spiral, which went from the early 1970s and into the 1980s, it was an extraordinarily destructive period for our economy. Getting inflation under control was extraordinarily difficult and something that caused untold harm to many families and businesses right across this country, including the farming business owned by my parents at the time. Probably the toughest period in their lives was when inflation got out of control and a heavily regulated labour market caused a wage price spiral. We see a recentralisation of the wages system under this government, so those risks are very much present again.

We should also not seek to put inflationary pressure into the system through our social security safety net. A safety net is just that. We need to take that seriously. We need to look at the general economic settings and understand the position Australia is in. Luckily, we have a historically very low unemployment rate at the moment. That is something that this government inherited from 10 years of coalition management of the economy. Those opposite blame absolutely everything on us, but they take full credit for the unemployment rate. How they justify that, even if their own minds, is beyond me.

The fact is that Australia does have a very strong employment rate, with very strong growth in employment. As I said, that is on the back of a decade of coalition management of the economy and on the back of the JobKeeper program, something that kept hundreds of thousands of Australian workers connected to their workplace throughout the global pandemic, which risked seeing businesses shut down. In other parts of the world, where businesses were forced to close down and where the connection between businesses and their employees was not maintained, the economic results were a lot more negative and significant.

The other thing that I always like to address at these opportunities is the myth that, in some way, the coalition government was not a friend of real wage increases. In actual fact the decade of coalition government saw real wage increases throughout that period—sustainable real wage increases, and this is the point. Real wage increases—wage rises above inflation—have to be based on productivity and on the needs of small and medium-sized businesses across Australia and their ability to pay. We can't see wage rises or social service payment rises come as a fiat from on high. That is where we will get into very real risks for our economy, including the risk of putting further upward pressure on inflation at a time when the Reserve Bank has done the heavy lifting, not helped by this Labor government. There does seem to be some downward movement in the inflation rate, but that is not something that can't be taken for granted, and the Reserve Bank may have to move again, particularly if they see continuing inaction from this government, as they saw in the last budget.

The Reserve Bank were sitting on their hands; they were waiting to see what the government did in the budget, and, following the budget, after having a look at what the government presented, the Reserve Bank were forced to raise rates again. Obviously, this government didn't tackle inflation, didn't know how to tackle inflation in its budget, and the Reserve Bank had to act. Because the Reserve Bank are the only sensible economic player through this period, when the government have completely failed to deal with what they themselves say is the biggest economic challenge at the moment; they say that inflation is the biggest economic challenge. They just don't do anything about it.

This bill will make a range of changes to our social security safety net, and we will be supporting aspects of this bill and we will not be supporting other aspects of this bill. The coalition believe that we have a better path forward, that we have a better approach. We will be supporting expanding the eligibility for assistance for single parents under schedule 1. We will be supporting expanding the higher rate of JobSeeker for those aged 55 in schedule 2. We will be supporting the increase in Commonwealth rent assistance under schedule 3. We will be opposing the increase of payments by $40 a fortnight. Instead, as I say, we will be demonstrating our path forward, our better way, which is moving amendments to increase relevant income thresholds by $150 and removing the government's proposed $40 increase to the bill, allowing those on social security to work more to earn more income before they lose benefits. As I said, we will look to increase JobSeeker and other income-free areas by $150 per fortnight across the payments under the social security safety net.

This bill will increase the base rate of payments by $40, but it fails to reduce barriers to work. There are currently 431,000 job vacancies in the Australian economy. The unemployment rate sits at a historic low, but Labor continues to fail jobseekers, businesses, communities and, importantly, taxpayers across the country by doing nothing to alleviate the entrenched disadvantage. We need to further incentivise jobseekers to take up those employment opportunities that do exist. There are 808,000 JobSeeker recipients of which more than 75 per cent had no reported earnings. We all know that creating jobs and getting people back into work is the best way of improving living standards, and it's also the best way of breaking intergenerational welfare traps. That's why, in his budget-in-reply speech Peter Dutton, the Leader of the Opposition, stated that increasing the amount that can be earned before benefits are reduced and thus incentivising jobseekers to take up employment opportunities is coalition policy. Increasing the amount that can be earned supports jobseekers and many small- to medium-sized businesses who are crying out for workers and who are being left stranded by the Labor government.

My colleagues in the chamber and I meet with those businesses—in my case, particularly in rural and regional Western Australia. We meet those businesses literally every time we are out and about. Increasing the amount that can be earned supports jobseekers and many small- and medium-sized businesses, as I said, which are crying out for workers. This is a preferable way of providing additional support to people on JobSeeker. Our approach has been to increase the income-free threshold from $150 to $300 a fortnight before taper rates of JobSeeker payments kick in, giving those people more opportunities to work. This is good for the economy, we know it's crucial for small- and medium-sized businesses looking for more workers and we know it is the best thing for JobSeeker recipients themselves. Breaking back into the workforce, particularly when you have been on social security support for a period of time, is the most important change you can make in your life, and it does change lives. I'm sure every single person in this room, no matter where you sit in the chamber, would have met many people who have been in that circumstance—who have been long-term unemployed and who have turned their lives around by being given an opportunity in the workforce.

Under our approach, income-free thresholds will also be increased by $150 for other related working-age payments such as youth allowance, parenting payment partnered, Austudy payments and the disability support pension youth. Encouraging a JobSeeker recipient by giving them that financial incentive to take up hours of work that we know are available or take up even further hours of work if they are already working is a far better way in this economic environment of providing support to those JobSeeker recipients, as opposed to simply increasing the amount of JobSeeker they are receiving for no work, with no requirement or incentive to do additional work or even some work at all. It helps alleviate labour shortages that are currently being faced throughout the economy.

As I've said, and I'll end on this, there are 431,000 formal job vacancies in Australia. There are many, many hundreds of thousands, as all of us would know, of informal job vacancies in the economy as well. You come across them every day if you are talking to small- and medium-sized businesses in Australia. I commend the coalition amendments to the chamber.