Senate debates

Tuesday, 2 August 2022


Social Security and Other Legislation Amendment (Self-Employment Programs and Other Measures) Bill 2022; Second Reading

1:02 pm

Photo of James McGrathJames McGrath (Queensland, Liberal National Party, Shadow Assistant Minister to the Leader of the Opposition) Share this | | Hansard source

I rise to speak in support of the Social Security and Other Legislation Amendment (Self-Employment Programs and Other Measures) Bill 2022. The new employment services model Workforce Australia was developed by the previous coalition government over a number of years and commenced on 4 July 2022. The new model seeks to build on the success of jobactive and give jobseekers the best opportunity to find opportunity through a tailor-made approach. The former coalition government spent a number of years working with jobseekers, providers, peak bodies and employers on developing a model that works for all and supports a pathway for Australians off welfare and into work. It will eventually become a one-stop shop for Australians and Australian businesses to find work, retrain and find access to other government initiatives in employment and skills. This bill will continue to realise that and will ensure the good intentions continue.

The main amendments in this bill, in schedule 1, will make it clear that the family, social security and veterans entitlements laws operate in the same way in relation to self-employment assistance payments as for other niche payments, because of the name change. The New Enterprise Incentive Scheme, known as NEIS, has helped almost 200,000 people start their own businesses since it commenced, many of whom might otherwise have continued to rely on Social Security payments or veterans entitlements payments. The program helps people move off income support by creating their own job. In turn, many of these businesses have created work for additional people.

The Self-Employment Assistance program commenced on 1 July 2022 to replace NEIS assistance throughout Australia, other than on Norfolk Island, where NEIS will continue because we have an existing deed that does not expire until 2023. It is important that we continue this work, and the bill does this. These changes are primarily in sections relating to the treatment of entitlements, and they clarify in legislation that the self-employment assistance payments are to be treated in the same way as NEIS payments. For example, the Family Law Act 1975 defines 'income tested pension, allowance or benefit' as a pension, allowance or benefit prescribed by the family law regulations. For that purpose, those regulations refer to payments made under NEIS so that such payments are included within the definition. This must be changed to reflect the Self-Employment Assistance program. That is appropriate, as self-employment assistance is similar to other NEIS assistance, the difference being that self-employment assistance participants will have much more flexibility in choosing and accessing support that best suits their circumstances.

Schedule 1 also means that, if self-employment assistance is given a different name, the family, social security and veterans entitlements laws will continue to operate in the same way—provided that the employment secretary makes a notifiable instrument giving notice of the change—without the need for a future bill. This is worthwhile because it means that we can spend less of the chamber's time on bills like this and focus on other measures to support employment in Australia.

The former coalition government's investment in Australia's workforce has worked to move people from unemployment and into jobs. Prior to the pandemic hitting, it had reduced Australia's level of welfare dependency to the lowest level in 30 years. The former coalition government successfully brought Australians through the pandemic, bringing Australia's historically low unemployment rates with it. The unemployment rate of 3½ per cent is a testament to that. From when we were elected to government in 2013, we were determined to put in place the strong economic policies and labour market programs that allow the economy to recover and support Australians into work. Prior to the COVID-19 pandemic, the coalition's strong economic management had supported the creation of over 1.5 million jobs. The economy was growing, Australia had record labour force participation, the unemployment rate was 5.2 per cent in March 2020 and, for the first time in 11 years, the budget was in balance.

Our former employment services programs have played an essential role in supporting economic recovery by increasing labour force participation and helping workers transition to new jobs. These programs, including jobactive, Youth Jobs PaTH, Transition to Work and ParentsNext, are working and have ensured that we bounced back from COVID-19 and continue on the pathway of getting more Australians into work. These programs have assisted hundreds of thousands of Australians to improve their employability and gain employment, with jobactive having supported over 2 million job placements since its introduction in 2015.

To assist Australians back into work after a once-in-a-century pandemic, we built on this record and improved services for our most affected regions and our most disadvantaged jobseekers. We put boots on the ground across 25 regions to support employment through our Local Jobs Program. Employment facilitators developed local jobs plans in 25 regions, in collaboration with local stakeholders, employers and training organisations.

The new employment services model, known as Workforce Australia, is now in place and is providing more personalised services to better target jobseeker needs, investing in those jobseekers who need it and making greater use of digital technology. Workforce Australia was the biggest reform to employment services since the Howard government's reforms in the 1990s, showing our commitment to helping Australians into work and modernising one of the biggest expenditure areas of government. The coalition are proud of this record and continue to work where we can on improving employment opportunities, even if that means now from opposition. We commend this bill to the Senate.

1:08 pm

Photo of Janet RiceJanet Rice (Victoria, Australian Greens) Share this | | Hansard source

I rise to speak to the Social Security and Other Legislation Amendment (Self-Employment Programs and Other Measures) Bill 2022. The Australian Greens believe that all people have the right to a livelihood; to pursue their preferred work; and to have freedom, dignity, economic security and equal opportunity in that work. Therefore, we support the objectives of the Self-Employment Assistance program, which is what's being addressed in this bill, and those of its predecessor, the New Enterprise Incentive Scheme, to help people find meaningful employment by creating their own jobs. It's a good thing. But we believe that the government has a responsibility to ensure that everyone can exercise their right to meaningful work, and what's being done in this bill is only a small part of what needs to occur. Successive governments have failed to ensure that everybody can exercise their right to meaningful work.

Particularly for people who aren't currently working, there is so much more that we need to be doing. We have people on income support living in poverty, which is the last place you need to be to get the support that you need to access work. There's no point setting up schemes, fiddling at the edges and encouraging people to start their own small business if those people are languishing in poverty and can't afford to have a roof over their heads or put food on the table. These are not the conditions that enable people to find work. We need to completely overhaul the systems in place that are in many cases barriers to people finding work.

I want to spend some time talking about those new systems in Workforce Australia. The experience of the introduction of Workforce Australia is that it not doing anything to help many people find work. These are people who want to be able to find work but find themselves battling a government bureaucracy and a system that is not supporting them to find work. We are very disappointed that, earlier this year, the new Labor government began rolling out the previous government's broken and punitive employment system, Workforce Australia. I note that today we got notice in the House that the Minister for Employment and Workplace Relations, Tony Burke, is proposing that there needs to be an inquiry into Workforce Australia. I think there needs to be more than an inquiry. Certainly, when the terms of reference are that this inquiry proposed today wouldn't have a reporting date until September next year.

We know the problems that exist with Workforce Australia at the moment, and they need to be fixed. Under this new system, people on income support have to complete enough activities to accrue 100 points a month or else have their payments cut off. Despite this being a major overhaul of the mutual obligations system, the Labor government provided little or no communication on the transition. According to a survey on the transition conducted by the Australian Unemployed Workers Union, 43 per cent of their members received no information from the government about these changes. Community members have expressed to me their confusion and distress as a result of this poor communication.

But this isn't the end of the issues and the pain that Workforce Australia has caused and is causing. Despite Minister Burke's promise that this new system would be a clean slate, we have seen demerit points carried over from the jobactive system, which is in complete contradiction to the promise made by the minister. We have seen the deadnaming of trans people in communications with them. We have seen inaccessible communications to culturally and linguistically diverse communities and people with disabilities. There have been privacy issues and technical difficulty after technical difficulty. If we're serious about getting people work, and if we're going to try to get systems set up, we've got to do better.

The Guardian recently reported that a 63-year-old woman from regional South Australia had to make a 250-kilometre round trip to meet her mutual obligations and keep her benefits under Workforce Australia. Despite living to Yorketown, she was referred to a job agent in Kadina, which was a 1½-hour drive—or 125 kilometres—from her home. Shockingly, these appointments and the long, tiresome journey that comes with them don't count towards the new points based system. Workforce Australia is causing people harm and stress. The system is already failing and yet it is jobseekers who are being held over a barrel and threatened with payment suspensions. People are terrified and confused. One user of the platform said, 'I am panicked, frustrated and have no idea what's going on.'

Workforce Australia has failed people from day one. Unemployment advocates, people on income support and the Greens have been calling for a minimum three-month pause to payment cut-offs while people attempt to navigate this new, confusing system. We initially had a one-month pause because there was a recognition from the government that maybe the communication and the system weren't set up for the transition. Last week, Minister Burke announced that, in terms of accruing points, there would be an extra 30-day pause, acknowledging the problems with the system. Today we have a proposal for a House inquiry into Workforce Australia. I urge the government to listen to the unemployed advocates and people in income support, and take immediate action to ensure that no-one loses their income support payments. Without those payments, if you've got people being cut off and living in fear of being cut off you are not going to have a situation where people are capable and able to be their best and to get work, whether it's through applying for jobs or, like in the bill we're discussing today, assistance to start up their own small businesses.

The second area I want to talk about in particular is the absolute inadequacy of income support under our JobSeeker payments. We are in a cost-of-living crisis, and poor and working-class people all over the country are feeling desperate. Again, if you've got people living in poverty that can't afford to put food on the table they are in no position whatsoever to take up initiatives to help them find work by setting up their small business. According to an ACOSS survey more than half the people currently on income support are skipping meals, and the demand on food charities has seen a 50 per cent increase since the start of the pandemic. We have millions of people in this country who are living in poverty. We have got to address that as a core issue if we are serious about getting people into work.

The Greens think we need to abolish mutual obligations. They are not helping. In fact we had a real-life example of that during the COVID pandemic, when mutual obligations were suspended and people's income support was doubled to account for people's lack of ability to find work. And what happened? The evidence is in: we actually had more people able to find themselves work during that period than in previous periods. The evidence is there: if you give people enough to live on and you don't make them jump through ridiculous hoops of mutual obligations, people want to get work. You then have people in a situation where they are able to pick up on the incentives provided in the Self-Employment Assistance program.

Anyone who has ever struggled to put food on the table or had to make a choice between paying the rent on time on one hand and paying for their medication on the other knows the constant and crushing stress of living in poverty. In this wealthy country something is deeply broken when around 20 per cent of our population are receiving payments that aren't enough to survive on and you've got one in six children living in poverty. Think about what that means for those people's lives—the trajectory of their life ahead of them. If you start off life living in poverty, if you start off absolutely having to scramble, not having the opportunities that other people get, it sets you so far behind in terms of being able to realise your full potential. No parent should have to wonder how they are going to feed their kids this week or buy them new school uniforms next term.

We need a plan to end poverty. They're the sorts of initiatives that are really important, that are going to do something about getting people into work. If we actually had a plan to end poverty—we know huge swathes of people are struggling every day to take care of their families and to get their most basic needs met. Governments are meant to serve people. Millions of Australians are hurting, and this parliament just can't ignore them. People want to be able to live their lives with dignity, without the constant fear of how they're going to keep their heads above water. It's not too much to ask.

The Greens believe that a fair, socially just, democratic and sustainable society rests on the provision of an unconditional liveable income, complemented by the provision of universal social services. If everybody had a guaranteed liveable income, everybody would be in a position to realise their potential, to have the capacity to seek work, to undertake training programs, to know they're not going to have to work out how they manage to survive and scramble from one day to the next.

We're supporting this bill today but it is a tiny piece on the edge rather than tackling the fundamental problems we are currently facing that need absolutely serious overhaul. We need to reform the social security system to introduce a liveable income guarantee. By doing so, and by abolishing the broken and punitive mutual obligation requirements, the Greens plan actually would give every Australian a fair go and stimulate the economy. We know that the No. 1 thing that this parliament can do to address the cost-of-living crisis and help get people into work is to lift income support, as well as providing access to affordable housing and essential services, so that people aren't living in poverty.

Yes, we'll support this bill today, but we are calling on this government to do more: to abolish the mutual obligations, to lift income support to above the poverty line and to raise all payments to at least $88 per day, which is what is needed to keep your head above water. By doing so we would be giving every Australian the opportunity to get into employment and live a full and flourishing life.

1:20 pm

Photo of Catryna BilykCatryna Bilyk (Tasmania, Australian Labor Party) Share this | | Hansard source

The bill before us today, the Social Security and Other Legislation Amendment (Self-Employment Programs and Other Measures) Bill 2022, makes some technical changes regarding employment programs, which I will deal with later in my speech. But first, I would like to state how annoyed I get during debates in this chamber when senators on the other side make accusations that Labor members and senators do not understand what it's like to run a business. They obviously say this in an effort to reinforce the misguided, and patently false, notion that the coalition are the friends of small business and Labor are not. This is clearly wrong, and I will challenge that notion later in my contribution.

Before I do, let me tell you what I find particularly infuriating about that claim. It's actually based on complete ignorance of the backgrounds of senators on this side of the chamber, including me. When we have debates about early childhood education and care, I often mention my more than a decade as an educator. I was a family day care educator, and, like many family day care educators, I was in charge of my own business. Also, I come from a family where my mother owned her own small businesses for 40 years. I know there are others on this side who have had similar types of engagement with small business.

I grew up in small business. I know small business. So I really would like those on the other side to please stop telling us we don't understand it. I understand the challenges and I understand the benefits. In the early childhood education sector you have all the usual challenges—collecting fees from customers, paying the bills and promoting your business—but on top of that you've got a whole set of regulations, from three levels of government, that you've got to comply with to ensure you're delivering safe and high-quality education and care. You have to deal with all this administrative work on top of your core business as an educator.

I don't have any quibbles about the regulations. It's an industry that deals with children who are vulnerable and at a crucial stage in their development. But it was tough. Through the industry I got to know many other educators, all of whom were running their own family day care businesses and facing similar challenges. So it really does get on my nerves, I have to say, when I am told that only the coalition cares about small businesses or Labor doesn't understand the challenges of running a small business.

I'm happy to help anyone who comes to my office seeking to take on the challenge of running a small business. My staff and I are often encouraging constituents to call or visit their local business enterprise centres and avail themselves of the free advice and assistance on offer there. At this point, I'd really like to give a great shout-out to my local enterprise centre, the Kingborough & Huon Business Enterprise Centre, of which I've heard excellent reports from the constituents I've referred there. Their previous manager, Scott Dufty, who has served for a number of years, has recently retired, so I wish him well on his future endeavours. I also congratulate Kerry Muller on his promotion to manager. I was really pleased to catch up with both Scott and Kerry at an event recently where the centre was celebrating the renewal of their government contract to deliver enterprise centre services.

My office has also helped small-business people to access business grants or other forms of financial assistance. I've established my office as a delivery partner in the No Interest Loan Scheme, NILS. NILS is commonly thought of as a program that low-income earners access so they can buy large household items, like a car, TV or fridge, but one of the services NILS also offers is no-interest loans to start a new microbusiness, and we have helped a few NILS clients with business ideas to lodge their applications. Those are just a few of the practical ways that I help people to establish small businesses or to thrive in their existing businesses.

So, when it comes to the bigger picture of what small business needs to succeed, Labor in government have a proud record of supporting small business. We recognise how vital small business is for the Australian economy, with 2.4 million small businesses throughout Australia employing 4.7 million people. It was the Rudd-Gillard Labor government that introduced the loss carry-back initiative, which allows small businesses to invest in their operations and then carry back their losses to earlier years, getting a refund for tax paid on previous profits. The Rudd-Gillard government also increased the instant asset write-off from $1,000 to $6,500. That meant a small business could invest in an asset, like a coffee machine or a bench tool, and instantly deduct it. We also introduced a measure that allowed businesses to instantly write off the first $5,000 of a motor vehicle purchase. We introduced these measures understanding the importance of cash flow to small businesses, allowing them the opportunity to access the tax deductions from capital purchases more quickly. Two of my brothers—well, they've both just recently retired—ran their own businesses for 30 or 40 years and, I've got to say, they found all of these things very advantageous to them.

Shamefully, the coalition, under the leadership of Tony Abbott, stripped away this valuable assistance, returning to the original threshold of a thousand dollars and subjecting small businesses to an effective $5 billion tax increase. But they must have seen the value in the measure, because they increased it again in 2015, at the same time trumpeting what a great help it would be for small business. So we introduced it, they cut it, and then they reintroduced it to say what heroes they were—what a backflip! Maybe they just couldn't cope with Labor getting the credit for doing something to help small business.

The previous Labor government also established the Fresh Ideas for Work and Family program, a $12 million grants program to help small businesses meet the set-up costs of family-friendly working arrangements.

In the current parliament, it's exciting to see that a Tasmanian colleague of mine—Julie Collins, the member for Franklin—has been appointed Minister for Small Business. My electorate office is in Ms Collins's electorate and I work very closely with her, and I'm sure any small business owners who know her as well as I do will be reassured that the portfolio is in good hands.

Labor's commitments to small business in government are outlined in our Better Deal for Small Business, which we took to the last election. This plan includes guaranteeing that the government considers the specific needs of small business during times of crisis; creating a mechanism to ensure that small businesses are paid within 30 days; making unfair contract terms illegal so that small businesses can negotiate fairer agreements with large partners; driving a genuine collaboration with small businesses and government to cut paperwork, target support and reduce the time that small businesses spend doing taxes; delivering simpler, more accessible and fairer outcomes in workplace relations by drawing on Labor's history of working with unions, workers and industry; and reducing small business transaction costs at the point of sale.

What I can add to that list, although it relates to business in general, is Labor's commitment to establishing Jobs and Skills Australia and tackling the skills crisis by investing in university places and free TAFE. The COVID pandemic has laid bare the depths of the skills crisis across this country. Labor in government had a proud record of not only investing in skills but also having the mechanisms to work with employers, employees and unions to identify the skills gaps. I know about the great work of industry skills councils through my work as a union representative on two industry skills councils. Shamefully, these bodies were scrapped by the Abbott government, but I'm excited to see that this capability will be returning when we establish Jobs and Skills Australia.

Another great Labor initiative for small business was the New Enterprise Incentive Scheme, or NEIS, introduced in 1985 by the Hawke government. This initiative is particularly important to mention because it relates directly to the bill we're debating now. Through NEIS, individuals can receive a package of services that help them to establish a new business. More recently it also helped existing business owners impacted by COVID-19 to continue running their business or refocus their operations to meet new areas of demand. Since NEIS was introduced it has helped over 198,000 people—198,000 people! There are a number of supports available through NEIS, including accredited small business training, help to develop a business plan, personalised mentoring from a NEIS provider—

Photo of Matt O'SullivanMatt O'Sullivan (WA, Liberal Party) Share this | | Hansard source

Thank you, Senator Bilyk. It being 1.30 we'll proceed to two-minute statements.