Social Services Legislation Amendment (Youth Employment & Other Measures) Bill 2015

Click here to watch Sharon's speech 

MS BIRD: (Cunningham) (11:55): I listened with great interest to the member for Bowman's contribution just then. It is not just about saying go out and have a go for 28 days. It is saying to people to try and do that with absolutely no money. That is what the issue is at the heart of this bill. I would like to see him try to go out and spend 28 days getting dressed, going on the transport system, having to buy lunch while you are out and looking for 28 jobs but having absolutely not a dollar of income to do it on. That is, at heart, the issue. We do not disagree with many of the principles the member for Bowman outlined in terms of mutual responsibility under these payments and about requiring people to participate and—as he said—to have a go. We just do not believe that is reasonable or fair to ask people to do that without any form of income support. Not everybody is in as privileged a position as many of us may have been at that age to have family who could support us through that time. That is at the heart of why we have these concerns with this bill.

The challenge, obviously—and the member for Bowman referred to this quite rightly—is there is persistent high youth unemployment across our nation. In particular, in regions like my own in Illawarra, it is one of the most serious and persistent social and economic issues that we confront. It is clearly the case that one of the flow-on effects across the developed world from the global financial crisis has been its impact on employment opportunities for young people. In Australia, we have seen a serious drying up of entry-level jobs. These are the ones that give young people a start in the workforce. This increasingly applies to young people with post-secondary qualifications. It is not only those without any employment specific education and training who are seeing the opportunities for entry-level jobs dry up right before their eyes.

Many young people are telling me and, I am sure, many of my colleagues in this place across both sides of the chamber that nearly every job they would like to apply for says an essential criteria is a minimum of two or three years experience. That requirement then blocks them from getting a start to get the required minimum experience in the first place, so they end up in this no-win situation where they want to get the experience they need to get a permanent job but then all the jobs that they are potentially qualified to apply for all require experience. It is a really persistent problem for them. And I am sure all my colleagues have heard this from young people who are in the job market.

Young people are also increasingly relying on cobbling together multiple jobs or indeed contracts—many of them working on short-term contracts—in order simply to make enough to live on. This type of work then locks them out of reliable or permanent work and it leaves them precariously attached to the workforce. Whilst sometimes this can lead to a permanent job after a period of time, that does not seem to be the common experience for many young people. In this context, therefore, I believe it is completely wrong for the government to seek to implement a bill that will only add to the financial stress and difficulty for young people in our communities.

This bill introduces a number of social service measures from the 2015 budget relating to both youth allowance and Newstart for young people. I would like to briefly outline these before indicating where I stand on the matters before us and then, more importantly, to discuss the significance of supporting education and training opportunities to assist young people with gaining employment.

Firstly, the bill seeks to reintroduce the initiative from the 2014 budget about a waiting period but with a different time frame proposed in this budget. Secondly, it seeks to revisit that proposal that required young people under 30 to actively seek work for six months before receiving income support payments. This was opposed by the parliament and now the government is seeking to reintroduce the policy with a reduced period of four weeks, with a proposal to delay the introduction of that until 1 July 2016. Labor continues to oppose this proposition as it will leave young job seekers under 25 was nothing to live on for a full month. This would also limit their ability to participate in job-seeking activities as they would have no income available to them. Therefore, it seems a particularly short-sighted and mean proposition. Clearly this proposition would push young people into poverty and potentially trap them in an endless cycle of no income support at all, thereby increasing poverty, crisis and homelessness.

Thirdly, the bill continues the previous budget measure to extend youth allowance (other) from 22- to 24-year-olds in lieu of Newstart and sickness allowance, also simply making life harder for these young people. We continues to oppose that proposition. Fourthly, the bill proposes to cease the low-income supplement paid as part of the compensation for the carbon price from 1 July 2017. This is a payment that is made to singles and couples on low incomes. Labor is willing to consider this proposition but not in the context of the other proposals in this bill.

Finally, and fifthly, the bill seeks to re-introduce measures from the 2014 budget on indexation but with the exclusion of pensions and an amended start date. Specifically, it would maintain at level for three years the income-free areas for all working age allowances, other than student payments and parenting payment single, from the existing start date of 1 July 2015. Also, it would maintain at level for three years the income-free areas and other means test thresholds for student payments, including the student income bank limits, with a start date of 1 January 2016. This measure was opposed by Labor in the context of the 2014 budget and we continue to oppose it.

licIt is clear the government has actually learnt nothing from the fundamental unfairness of last year's budget. This budget is just as unfair as the last when it comes to young job seekers. This is compounded by the fact that this budget has done nothing to re-instate any of the savage cuts in last year's budget to the skills portfolio, in particular for apprentices and trainees. Apprenticeships and traineeships are important pathways for young people to undertake education and training that would improve their opportunities to gain a job.

Let me just recap the extent of the cuts in last year's budget. The government's early action on apprenticeships was to introduce the one initiative they had taken to the election on skills. They introduced their apprentice loan scheme. But we in Labor were quite angry on behalf of apprentices that in outlining this scheme before the election the government did not outline to apprentices that it would be at the cost of the Tools For Your Trade payments which provide direct financial assistance to all eligible apprentices to get the tools they need for their trade and to assist with other costs. I am sure that many members have received the same feedback that I have about the intense disappointment felt among apprentices about this decision.

Last year, I visited a construction site in Werribee, outside Melbourne, with my colleague the member for Lalor. We spoke directly to about 20 apprentices across a number of trades. They were all angry about the removal of the Tools For Your Trade payments and, to be honest, quite scathing about the Trade Support Loans as a replacement option. Indeed, in the in-detail budget session last week, the minister indicated that only around 24,000 apprentices across the nation had taken up the loan. Given that there are several hundred thousand young people in apprenticeships at any one time, that is a very, very low uptake. This morning, with the Leader of the Opposition, I visited some apprentices at the Canberra Institute of Technology. I asked the class, 'How many of you have actually taken up the Trade Support Loans?' There was only one in that class who had. All the rest had no interest in undertaking debt. So they clearly missed the impact of Tools For Your Trade.

Just as importantly, there were very significant apprenticeship support programs abolished in the budget. The first one was the Apprenticeship Access Program. This particularly targeted very disadvantaged young people to get them the skills, appropriate knowledge and familiarity with work culture, as the previous speaker spoke about, such that they were prepared to undertake an apprenticeship. In November 2012, I visited the MTA Autostart Access Program in Granville with the member for Parramatta. I saw firsthand an impressive program that helped people who were very vulnerable job seekers get themselves ready to gain a full apprenticeship. During that visit, I met local car business owners, managers and representatives of the Motor Traders' Association. They were all very dedicated to helping young adults get a start in a region plagued by youth unemployment. They were very proud of the success they were having in transitioning so many of those young people into full apprenticeships. With no notice or evidence of failure, this scheme was simply abolished in the 2014 budget.

Another program that was abolished was the Apprenticeships Mentoring Program. Many of my colleagues would be aware that there has been a consistent concern about the number of apprentices who are actually completing their training. This program was very much appreciated not only by apprentices but also by employers. In March of 2013, as the minister, I launched the Construction Apprenticeship Mentoring Scheme at the Master Builders Association of the ACT training centre.

Mr McCormack: A very good organisation.

Ms BIRD: As the member opposite says, this is a very good organisation and one that was very keen to participate in the mentoring of young people in apprenticeships—a really important thing to undertake. It was an $80 million program and it was critically targeted at improving those completion rates. Again, I am quite at a loss to understand why the program was simply abolished in the 2014 budget.

We also see cuts across the apprenticeship sector more broadly. The old Australian apprenticeship centres have been rebadged as the Australian Apprenticeship Support Network. The problem I have with this is that these network providers that work with apprentices at the local level are now doing that with $10 million per year less than the old apprenticeship centres had. Plus, they have been given the job-matching and mentoring work that used to be happen under other programs. So all up, instead of $170 million or $180 million per year, they are being asked to do with less money. So the reality is that there is still a lot more work with significantly less money, so I can only see that, with the best will in the world, those new providers are really going to be under the pump to effectively impact both apprentice commencement and apprentice completion rates.

In particular, I just want to make the point that one of the areas that are particularly significant in this space is to get small and medium businesses involved in being able to take on apprentices and trainees. Many of them are really keen to do this, but the management of an apprenticeship—the paperwork, the legal requirements, the follow-up with the apprentice and managing the apprentice—is just too much for them to take on as well as their business responsibilities. So for many decades they have had the option of the group training program in order to participate in training apprentices. The group training organisation did all of that work and managed the apprentice, who was placed with a particular employer. Sadly, at the end of last year, the government abolished the financing of the joint group training program which allowed them to do this. So we have seen a lot of slashing in the skills portfolio, at least half of which—about $1 billion—has been in support for apprentices and trainees in this country.

So the government, in bills like the one before us, has a very mean approach to dealing with young people who may find themselves unemployed and do not have the sort of extended family who can financially support them for a month. They will actually be unable to access any income support for that period. At the same time, we are seeing significant cuts across all the sorts of programs that would actually give them the opportunity to get some skills, some training and some work-readiness and to improve their ability to get into the labour market—and all this at a time when the labour market is becoming harder and harder for young people trying to get a start, particularly in those entry-level jobs, as I discussed at the beginning. We are now seeing increasing reports of university graduates who are struggling to get their first job, because they may have their degree but all the entry-level jobs in the professional area they are looking at require a minimum of two or three years experience. So it is not just young people with no post-secondary qualifications; it is increasingly those who are graduating from our TAFEs, our RTOs and our universities all facing this same challenge. So it just seems to me that the government is intent on creating a bit of a perfect storm that is just going to make it more and more difficult. If the OECD recognises that youth unemployment is a critical factor for the developed world, I think we should be putting in place decisions and legislation that lead to solutions to that for young people, not put more barriers in their way as I believe this bill does.