Social Security Legislation Amendment

Mr PERRETT (MoretonOpposition Whip) (13:14): I rise to speak on the Social Security Legislation Amendment (Youth Jobs Path: Prepare, Trial, Hire) Bill 2016. Can I say up-front, I commend the member for Lalor on her contribution. She is always worth listening to, and she certainly seemed to cover the perils of this legislation very well.

In another life, before I was in parliament, I had a couple of jobs that were less well remunerated than being a politician. I started off my time at high school spending every summer cotton chipping in the cotton fields around St George and then spent time, when I was at teachers college, working in an abattoir and at Hungry Jack's before moving into better paid jobs. I do say, Member for Lalor, that elements of my time as an articled clerk were not unlike what you described, except they did pay me as an articled clerk. I think 'paid slavery' would be the official description.

In 2016, we have heard an awful lot about jobs—all that talk of jobs and growth. I think I will need to get a therapist at some stage to get 'jobs and growth' out of my head. The coalition was all about the jobs and growth that they would be creating. But, sadly, the Turnbull government has failed at the very task that they set themselves—to create jobs and to create growth. They set the standard, and they failed. They have not met their own fundamental KPI which was—as written on the side of buses, basically—that they would deliver jobs and deliver growth.

Employment conditions have deteriorated so much that they are now, arguably, worse than at any time since the peak of the global financial crisis. I remind you of that, Deputy Speaker Broadbent, because the global financial crisis was the worst set of economic conditions since the Depression. But that is what we are looking at now. The problem is not just the unemployed; there is actually a huge problem in Australia of underemployment. The figure for underemployment for the August quarter was 8.7 per cent. Youth unemployment is at 12.8 per cent. There are more than 270,000 unemployed youth between 15 and 24 years of age. A recent report from Anglicare stated that there is only one job advertised for every six low-skilled jobseekers in Australia. The report said that in May this year alone nearly 140,000 people competed for roughly 22,000 entry-level jobs advertised across Australia.

This is a huge problem, and one that will not be solved by the government's PaTH program that is before the chamber. This bill is designed to support the government's prepare, trial, hire program—or PaTH. It provides that payments made to interns under the PaTH program will be excluded from the income test for social security payments, and thus not affect recipients' payments and entitlements. It allows for the suspension for up to 26 weeks of a person's social security payment, where they are employed by a business that is eligible to receive a youth bonus wage subsidy in relation to them under the PaTH program.

The problem lies not so much with the provisions in this bill as with the PaTH program itself, as detailed by the member for Lalor. The PaTH program is, appropriately, set to commence on 1 April 2017—because, surely, this is an April Fools Day joke on the young people of Australia. The program claims to provide job seekers aged 17 to 24 with work experience to maximise their prospects of subsequently gaining employment. These are, perhaps, noble intentions. But, although the objectives of the program might have some merit, there are huge problems with the architecture of the scheme. Australia's young unemployed are a very vulnerable group open to exploitation, and good government's job is to ensure that they are not being unfairly treated.

Existing programs, such as the Work for the Dole scheme, do have problems, and you could argue that they are failing. On the government's own figures, nearly 90 per cent of participants in the Work for the Dole scheme are not in full-time work three months after completing the program. We do not want to see our young unemployed given false hope and working for under award wages in a scheme that is destined to fail them.

This scheme, unlike the Work for the Dole scheme, will place young unemployed people in the private sector. Private sector employers will be paid $1,000 as an up-front payment for each jobseeker that they take on through the PaTH scheme. There are concerns that employers could take on large numbers of PaTH participants at any one time. Employers could churn through the participants without ever offering a job to any of them—repeatedly saying, 'This person was unsuitable.' This could result in employers not having to employ workers in particular areas at certain times. For example, an employer in the hospitality industry could use PaTH participants at a time when they would otherwise have to pay their staff penalty rates.

There is a real concern that the PaTH program will result in jobs being replaced with cheaper labour because of this program. Participants will be 'working' for below minimum award wages. A PaTH participant will receive their Newstart payment plus the $200 incentive payment while they are working for an employer in the program. If the participant is working for 25 hours a week, their hourly rate will be only $14.50. To put that in context, the national minimum wage is $17.70 an hour.

The 7-Eleven wage scandal is fresh in our minds—we saw that footage. Here in Australia in 2016 people are, effectively, paying their employer for the job that they have. I have not seen a lot of condemnation about that come from those opposite. In light of the 7-Eleven scandal and some of the concerns in the fruit picking area, why should we consider sanctioning the underpayment of our unemployed youth? That problem with the scheme would be very easy to fix. The government would just need to set the bonus payment and the hours to be worked at a rate that equates with the national minimum wage. The fact that the government has not fixed this just shows where their priorities lie—despite their protestations about unions, their priority is never to uphold workers' rights. Wages growth, sadly, is at its lowest on record. The PaTH program could further undermine wages across a variety of industries.

A further, very basic, problem with the scheme lies in the government's failure to actually define what they consider an 'intern' will be under the scheme. It is six months since the scheme was announced, and we still have no definition. Can an intern be a waiter, for instance? Can an intern be a shop assistant or a retail assistant? Is there any threshold necessary for the intern to learn new skills? We just do not know. Most people consider interns to be learning something additional to that which they learn in educational institutions. Traditional roles as interns have been found in publishing houses, law firms and other professional services, where you will enhance what is delivered by academics. But it does not seem that the government's definition of an intern will marry with my traditional view of an intern that we are perhaps more familiar with. I should say up-front that I do not have a problem with industries having interns—it is this program that I have significant concerns about.

There is another question that the government has not addressed yet—whether the participants in this scheme will be covered by appropriate workers compensation schemes in the event of an accident while they are 'working'. The participants will actually be considered volunteers in the workplace and not employees. This can affect how they will be treated by workers compensation schemes in the event of an accident. So there are many problems that have not been addressed in this scheme, which was way too hurriedly announced by a desperate coalition in their May budget.

The Prime Minister promised us the end of three-word slogans—but what did we see throughout the election campaign? Jobs and growth. I think I have even heard it this week. Sadly, the Prime Minister has not delivered—on his watch youth unemployment has climbed to nearly 13 per cent, double the national average. The Turnbull government talks the talk but does not walk the walk when it comes to job creation. Representing a marginal seat, I should point out that the Prime Minister decided to start his election campaign in my electorate, in Moreton. It is a marginal seat, so I can understand that. He kicked that off at the Brisbane markets, probably knowing that employment is always an important issue in the electorate of Moreton. In the lead-up to the 2013 election the Liberal-National Party candidate, Malcolm Cole—a good bloke—made a commitment that the coalition would stage a Moreton jobs summit within 100 days of the election. The Abbott government was elected, so the deadline for the coalition government to hold this employment summit, important for Moreton, was Monday 16 December 2013. But nothing occurred—not a thing. On 27 September 2013 I wrote to the relevant minister, Senator the Hon. Eric Abetz, a Tasmanian representative, regarding the implementation of the promised summit but to date this coalition 2013 election commitment has not been honoured.

This year we had a new election and a new parliament, the Prime Minister was elected by the people of Australia—with a majority of one—so I wrote to Prime Minister Turnbull after the election asking for the commitments made by the LNP during the 2016 election campaign to be honoured and I again asked that the commitment made during the 2013 campaign to hold a Moreton jobs summit also be honoured. You would think, with all the rhetoric coming from this government on jobs and growth, that the Prime Minister would be a man of his word, that he would honour their commitment. Sadly, to this day there is still no jobs summit on the horizon for Moreton— in fact, I have not even had a response from the Prime Minister to my letter to him. I call out the coalition government and ask that they honour their commitment—it is so important for the unemployed people in Moreton.

In contrast, the Labor Party has always had as its first priority the creation of jobs, and especially preparing youth for jobs. The member for Lalor and I in our previous lives were educators. We know how the important role education plays in giving people opportunities. In fact, Labor announced as a 2007 election commitment the Trade Training Centres in Schools Program. The Labor government's 2008-09 budget subsequently provided $2.5 billion over 10 years to implement that program. Four rounds of phase 1 of the program were completed under the Labor government. Sadly, the coalition government announced in 2013 that the funding for the trade training centres would cease following round five of phase 1, and the projects would thereafter be known as trade skills centres. The objectives of the Labor program included addressing skills shortages in traditional trades and other eligible occupations by improving student access to trade training facilities that meet industry standards and improving the quality of schooling offered to secondary students undertaking trade related pathways. As this is the graduation season, we know how many students end up working through a variety of courses. People end up at university through a variety of courses, including those trade training courses. The program was also assisting young people to make a successful transition from school to work or further education or training.

This program is reaping benefits for the youth in my electorate of Moreton. I recently attended the opening of the trade skills centre at the Runcorn State High School with the member for McPherson in her ministerial portfolio. Runcorn State High will now be offering their students the incredible benefits of having trade training facilities on site at their school. This facility will make an enormous difference to the future of these students. There will be two more trade skills centres opening in the future at nearby schools. The principals of those schools, Terry Heath from Yeronga State High, also in my electorate, and Linda Galloway of the Balmoral State High, in Griffith, were there to witness the opening of the Runcorn centre.

At the opening, I met Michael, who is a grade 10 student at Runcorn State High. He was proud to show me around the facilities. He said he was looking forward to the workshops starting so that he could build a Formula One car—one of the things they do. The Formula High School Program is one of the programs to be offered at the Runcorn State High School. It will teach students engineering skills and practices while building a race car—not quite the same as making a tea cosy for my mum when I was in shop. But this is not just fun; it obviously prepares them for work. Students who undertake the Formula High School Program will be completing a certificate II in Engineering Pathways, an engineering qualification that will equip them to enter a range of occupations. The student participants will learn practical, general, work-ready knowledge and teambuilding skills—real preparation for jobs where students learn a skill that is useful for employers, who will then give them a real job.

I fear that this PaTH scheme is not going to result in any more young people obtaining full-time work, but it may put the young unemployed, who are already vulnerable, in situations where they will be exploited. Young people deserve better than to be used and abused by an unscrupulous employer wanting cheap labour. That is my fear. Labor is calling for this legislation and the PaTH program itself to be considered by a Senate inquiry to ensure that these concerns are addressed. (Time expired)

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