Carol Brown (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

I rise to comment on the Employment and Workplace Relations Legislation Amendment (Welfare to Work and Vocational Rehabilitation Services) Bill 2006. The bill, which was introduced in the Senate late last year, has been described by the shadow minister for employment and workplace relations as one that is all mistakes, and Senator Wong is right. The bill tries to rectify old mistakes and manages to make a whole lot of new mistakes. Indeed the amendments contained in the bill, specifically those relating to the outsourcing of vocational rehabilitation services and the reduction in pensioner education supplement entitlements, reflect the Howard government’s nonsensical and failed approach to workforce participation and welfare reform.

Further, the government’s proposed changes to the funding for vocational rehabilitation services—which have seen it open the rehabilitation market for tender—have been passed by the parliament and reflect its utter contempt for the parliamentary process. As in all other areas, this government is pushing its own political agenda through parliament with blatant disregard for due process and, more importantly, for the interests of the Australian people.

Labor senators, in their report on the bill tabled on 20 February this year, noted that the bill represents a continuation of the most significant downgrading of the income support system since the Social Security Act was introduced in 1947. Further, while the bill was prepared under the guise of maximising the ability of people to find work, especially those with disabilities, it is in fact likely to have the opposite effect. Labor’s main areas of concern relate to amendments regarding the Veterans’ Vocational Rehabilitation Scheme, pensioner education supplement and financial case management.

Under the amendments contained in the bill, the government has made changes to the delivery of vocational rehabilitation services by allowing for the staged introduction of partial competitive tendering by July this year by amending the Disability Services Act 1986. The amendments remove the current requirement for individual rehabilitation programs to be approved under the act and also broaden the delegation powers of the Secretary to the Department of Employment and Workplace Relations to allow for additional providers of vocational rehabilitation services. Basically, the government is opening up the provision of vocational rehabilitation services to the market. Labor does not, in principle, see a problem with the idea that rehabilitation services should compete in the market but it does have a problem with the way the government has gone about introducing these changes and the lack of safeguards in the changes to protect Australians who are at risk or in a vulnerable position.

Firstly, as stated previously, the government began the tendering process for vocational rehabilitation services before the bill was even introduced into parliament. The Minister for Workforce Participation released an industry alert for the tendering process back in June 2006, with applications closing on 8 November of the same year. Thus, the entire tendering process was completed by the awarding of the contracts a whole month before the bill was even introduced into parliament in December last year. This lack of respect for the political process reflects not only arrogance on the government’s part but also a lack of due consideration of the best interests of the Australian people.

The government appears to be hell-bent on railroading its legislative agenda through parliament, whatever the cost or consequence to the Australian people. This is not the only instance where the current government has begun the tender process before a bill has been passed by parliament. We saw it recently take the same approach to tenders under the proposed access card legislation. How can this promote transparency and good government? It cannot. The government has also failed to provide adequate safeguards to protect people who use vocational rehabilitation services. A number of submissions received during the inquiry highlighted a particular concern relating to the provisions which allow private sector providers to be granted contracts without possessing a certificate of compliance under the Disability Services Act.

The Mental Health Council of Australia, in its submission to the committee, noted that this will not in any way assist in ensuring an initial high standard of service, appropriate consideration for people with mental conditions and, most importantly, confidence in the assessment of the site for people with disabilities. Once again, the government is happy to sit back and leave Australians at the mercy of the market without making provisions for adequate safeguards in the legislation. This reflects its ignorance of the fact that there are many in our society who are unavoidably placed in vulnerable positions and whose rights are in need of government protection.

Another area of concern is the potential withdrawal of pension education supplement payments to certain candidates. Labor senators on the committee noted:

Over the next three years, through the government’s Welfare to Work changes, approximately 81,000 people with disabilities will be put onto lower payments, mainly Newstart Allowance. This is because the DSP is now only available to those who are unable to work at least 15 hours per week ...

This means that the pension education supplement is not available to people on Newstart. Under the previous Welfare to Work changes made by the government, people who moved from DSP or parenting support payment to Newstart or Youth Allowance were supposed to retain their PES payment until they completed their current course of study. However, under the changes to PES payments contained in this bill, people who claimed DSP between 11 May 2005, when the changes were announced, and 30 June 2006, when they took effect, who qualified for the PES and who moved to an allowance will only continue to access PES payments if they no longer qualify for DSP as a result of their first review after July 2006. This will potentially result in a loss of up to $4,000 a year, going from the DSP payment to a lower payment, and the loss of the PES payment. This is an obvious backward step and is inconsistent with the government’s previous commitment to the transitional group of DSP recipients. Indeed, as the opposition senators noted in their alternative Senate report on the bill:

... no evidence could be provided to support the government’s policy of reducing income support payments in order to increase rates of participation in the workforce ...

That is because it simply does not work. Instead, the opposition has shown that countries that invest heavily in employment assistance have been the most successful in reducing unemployment and welfare dependency in the long term. It is as the shadow minister for workforce participation, Senator Wong, noted in her speech in the second reading debate:

This is the Howard government’s approach to moving people from welfare to work: to put people on lower payments, stop them from getting the training they need and then tell them to get a job—and then take back most of what they earn. This Howard government has never explained how reducing access to education and training helps jobless Australians get a job.

Now I turn to the financial case management changes. The bill includes amendments that allow for financial case management debts to be recovered from social security payments. Labor fully supports giving Centrelink the appropriate powers to recover overpayments through financial case management. However, the current provisions are inadequate and in need of attention. Labor believes the amendments are ill conceived and one-sided, setting in stone the government’s right to recover financial case management overpayments, and that the provision of financial case management is itself completely discretionary. Thus the amendments in this legislation will ensure that the government’s right to recover overpayments is set out in legislation but that access to financial case management will not be; it will remain entirely based on discretionary decision making.

While Labor believe that it is reasonable to recover overpayments, we see no logical reason why the provision of financial case management should not also be covered by legislation and its entitlements and payments subject to review and appeal. We believe that this would ensure transparency and fairness to everyone concerned: recipients, taxpayers and administrators. However, the government’s amendments as they stand seem to be nothing more than one bandaid solution on top of another. Again, Labor senators on the committee noted that the discretionary provision of financial case management in the first place is nothing more than a very poor attempt by the government to lessen the impact of its harsh Welfare to Work compliance regime.

Labor supports real welfare reform that helps people to move from welfare to work. It is, after all, the party of work and the party of working people. Indeed, Labor is extremely committed to assisting people in whatever way necessary to help them make the transition from welfare to work, whether this means providing quality vocational rehabilitation services or extra money to fund retraining.

The Howard government, on the other hand, just does not get it. It is too busy fulfilling its own ideological agenda to pay careful consideration to the needs of the Australian people and the workforce. How can a reduction in assistance result in more people taking up employment? Sure, it may force people to take up lower paid and unskilled positions, but how does it benefit the individual, their family or the community as a whole? Why not support people by giving them the training they require? Why not support them and encourage them to develop the knowledge and skills necessary to fill the growing number of unfilled skilled labour positions? Why? Because the Howard government is all about cost cutting and the dog-eat-dog mantra of the market. It is not for helping Australian people.

The Howard government’s lack of vision and liking for quick political fixes and cost cutting instead of carefully thought out policies to combat the skills crisis and to offer measures that enable a pathway to fulfilling, real jobs to Australians are evident through the original Welfare to Work legislation, its ill-conceived Australian technical colleges legislation and again in this bill. Labor would welcome a bill that delivers real welfare reform, but this bill is not it. This bill represents another failure by the Howard government, and, for the reasons outlined, Labor opposes this bill.

Labor supports a system that assists people to engage in the workforce where it is possible for them to do so. Labor does not support a system that discourages education, ignores skills advancement and fails to implement real policies to adequately train Australians. The Howard government have not explained how reducing access to education and training helps people get a job, and they will not, because this is about simple cost cutting and not about helping jobless Australians get real jobs. Labor takes a different approach. Labor believes that those who are jobless and lack skills should be encouraged to gain the skills they need to get a job. Labor believes that all Australians should get every possible support to reach their potential. By contrast, the Howard government have restricted access to services. It is with these concerns that Labor opposes this bill.

David Johnston (WA, Liberal Party, Minister for Justice and Customs) Share this | Link to this | Hansard source

I thank senators for their contributions in this debate on the Employment and Workplace Relations Legislation Amendment (Welfare to Work and Vocational Rehabilitation Services) Bill 2006. In summing up, I want to say that the bill contains a number of amendments to the Disability Services Act to support the staged introduction of contestability of vocational rehabilitation services. Currently the only organisation providing Australian government funded vocational rehabilitation services is CRS Australia. This bill, in supporting the opening-up of the vocational rehabilitation services market, ensures that people with injuries or disabilities will have better opportunities for assistance. The government’s proposed amendments to the Disability Services Act 1986 are about providing choice and diversity for people who require rehabilitation to assist them getting back into employment.

The services that different organisations will provide will help ensure that people will have the range of support they will need to help them re-enter the workforce. These changes will be implemented from 1 July 2007. Competition will mean that job seekers in most locations around Australia will be able to choose which provider best suits them, and star ratings will be developed to help job seekers identify which providers offer the best services. Having more providers will also mean better coverage for many regions, rather than job seekers relying solely on the one provider. CRS Australia is currently the national provider monopoly, and a monopoly means the government runs the risk that if people are unhappy with services there will be no alternative.

Introducing new players into the market will lead to innovation. We will see this in virtually every industry. Where there is more than one player in the market, there will be additional incentives to improve performance. Maximising outcomes for a diverse job seeker population requires responsiveness, creativity and flexibility. Competition among multiple providers will drive this. This forms part of the government’s continued commitment to help job seekers build capacity and find and maintain work through employment and related services.

The government’s vision for supporting people with disabilities is to provide more opportunities for participation in the economic and social life of the community. The amendments in this bill uphold the integrity of the social security law and ensure that the right people are granted the right payments and allowances. It is about providing consistency with the administration of the social security system.

I would also like to clarify certain points that speakers have raised in relation to the pensioner education supplement. Senators on the other side would have you believe that we are abolishing the pensioner education supplement altogether. Eligibility for the pensioner education supplement was extended through special provisions of the DSP transition group—that is, those people who claimed and were granted DSP between 11 May 2005 and 30 June 2006 and who have transferred to Newstart or Youth Allowance as part of the Welfare to Work reforms. People who have an ongoing eligibility for the disability support pension or parenting payment will continue to receive this supplement.

It would also seem that some senators have not properly understood how vocational rehabilitation services actually work. Vocational rehabilitation providers have not and will not diagnose an individual’s medical condition. To receive vocational rehabilitation services, job seekers must first be assessed by a job capacity assessor. This is the same process for job seekers who are referred to Disability Employment Network providers. Job capacity assessors are able to use this information to make an assessment of the impact of any health, injury or personal barriers on work capacity. This system will continue with job seekers who are referred to new private sector vocational rehabilitation providers undertaking the same assessments as those referred to CRS Australia. We are not changing the process of referral with these legislative amendments. The system that has operated as part of Welfare to Work will continue into the future.

I would also like to address and clarify certain points in relation to financial case management and breaching. Members on the other side continue to peddle this claim that our system of accountability is harsh and onerous. Case management under Welfare to Work is providing additional safeguards to protect the most vulnerable in our society. Claims by the outspoken opposition spokesperson, Senator Wong, and many other senators that it is ‘one strike and you are out’ within the system are absolutely wrong and typical of Labor trying to mislead the public once again. The learned senator has not done her homework with respect to this proposal. The facts are clear. Under Welfare to Work, if an individual breaches their agreement to look for work or participate in mutual obligation three or more times without a reasonable excuse in a 12-month period then they will receive an eight-week penalty. Only people who fail to accept a suitable job or leave a job for no reason may be automatically penalised. Claims that people will lose their houses or go hungry as a result of case management are absurd.

The system is not harsh; it is very fair and encourages the unemployed to make the most of the assistance provided to them and take up work opportunities. People in receipt of taxpayer funded income support usually want to work and actively look for a job. There are built-in safeguards to ensure job seekers only lose payment when they deliberately and knowingly choose not to look for work or accept a suitable job offer. The system is not about forcibly imposing penalties on individuals. The reformed case management program attempts to protect and assist an individual at every step—to continue to provide any ongoing assistance required to find a job. These measures will help to further provide assistance to vocationally rehabilitate or reskill these individuals to help them remain in or enter the workplace. I commend the bill to the Senate.

Question agreed to.

Bill read a second time.