Economic Recovery Package (JobMaker Hiring Credit) Amendment Bill 2020 - Second Reading

By Matt Keogh MP

19 October 2020

Debating this legislation, the Economic Recovery Package (JobMaker Hiring Credit) Amendment Bill 2020, today really just demonstrates how much this government is all about the headline and not about the action. We are here today debating this legislation that the government said is vitally important to get through this House so the Senate can debate it urgently. It's urgent that we debate this legislation in here! It was all over the papers. Why is it urgent? Because the Senate needs to consider it—in November!

But, taking the government at its word and wanting to be constructive and cooperative, making sure that we assist the government to make the best supports available to the people of Australia, we, the opposition, have made sure that this vitally important piece of legislation will actually be debated today. It's not because the government decided to bring it on for debate, no. It's because the Labor Party decided to bring it on for debate, because we understand that, when the government says to the Australian people that a piece of legislation is vital and urgent and important, we need to act cooperatively with the government. We understand the importance of these things, unlike the actual government, who decided to talk to the newspapers and talk to journalists but, when it comes to what they're actually going to do in the parliament—and the minister in the chair knows this all too well—had no plan whatsoever to have this legislation debated today.

The DEPUTY SPEAKER ( Mrs Wicks ): Order! The member for Burt will resume his seat. The assistant minister on a point of order?

Mr Howarth: It's one minute 30 and he hasn't said anything about the bill. I ask that he be relevant to the bill.

The DEPUTY SPEAKER: I remind the member for Burt to be relevant to the legislation.

Mr KEOGH: I thank the minister so much for that erudite contribution to this debate. I know it's a difficult concept to understand that the circumstance in which the legislation was brought on for debate today is relevant to the issue under debate. I understand that's a difficult concept for him, so I will move on and remind the minister and all of the members of the government that this piece of legislation is part of a broader suite of packages that have been about supporting Australian businesses and Australian workers, starting with Labor's call for a wage subsidy scheme. This was a call that the government ignored. It then had to resume parliament urgently so that we could pass the legislation that we told you a month earlier you probably needed. But, no, you ignored us—why would we ever have a good idea on this side of the chamber?—and then decided to come back with JobKeeper. That was excellent. We were glad that you did that. But, again, did you listen when we pointed out a number of flaws, like the groups of Australians that would be missing out because of the design of the scheme? No, you didn't take that advice either. You were quite happy to let childcare workers, local government workers, university staff and casual employees all miss out on the supports that should have been made available through a properly designed wage subsidy scheme during this deep, deep recession.

But we move on. It's important to recognise, as I said, the benefit that is being created here and to put that in contrast. Around 4,000 businesses in my community have relied on JobKeeper. They employ around 15,000 people, and they have all been grateful to receive the support that the JobKeeper supplement has provided during this recession. The thing that concerns them, though, is that the rate of that supplement is reducing, the availability of it to business is changing and the government is continuing to roll these reductions out. The government has said, 'Well, the economy's coming back, so businesses don't need the support.' If a business doesn't need the support, it won't qualify for JobKeeper; its revenues won't be 30 per cent down. If its revenue is still 30 per cent down, chances are pretty high that it still needs JobKeeper at the rate that it was being delivered.

This legislation is emblematic of the approach that the government outlined in its budget. Despite the fact that we are in a deep recession, the government talks about coming out of this recession quickly. But it's not going to be able to deliver on that if it keeps removing demand from the economy. I know aggregate demand is a difficult concept for you on the other side of the chamber to understand; you just want to work on supply-side economics, but the reality is, as small businesses in my electorate tell me frequently, that people in the community will have less money to spend in those businesses, which will ensure that their turnover remains at below 30 per cent. They're going to have that reduction, and that's why they need JobKeeper in the first place. This is a self-fulfilling negative prophecy that the government is legislating here and moving forward in its approach to the budget.

When the government stands in front of us, as the Treasurer did on budget night, to say that this budget is about delivering jobs, let us quickly check the facts. What this budget is delivering is 160,000 fewer jobs before Christmas. You can't go around and say, 'This is a job-creating budget,' when your plan is literally for 160,000 fewer jobs. But, if you listen to what we've been trying to tell you for months now, which is that you can't go around reducing demand like this and you can't go around reducing supports when the economy is still on its knees and instead should provide that support, maybe—just maybe—we wouldn't be faced with that sort of situation, we would see some job growth and we would see some wage growth in this country, which would, of course, support the economy to grow, which is what you keep telling us is what you are trying to do.

Then we get to the JobMaker hiring credit, which is supposed to effectively take over from the end of JobKeeper. Let's look at what you've designed there. Oh, hang on a minute, members of parliament; we can't look at what you've designed there, because this legislation doesn't actually include it. You've explained to us what you think you are going to do. You then presented a piece of legislation to the parliament which is fundamentally a blank cheque to the Treasurer to provide support. So we can't look at what you're actually going to do, but we will rely—because that's all we've got—on what you've told us you are going to do.

So let's have a look at this. You're going to provide a hiring credit to support the employment of people aged under 35. As someone who represents a community that before the COVID recession had youth unemployment at a rate of around 15 to 20 per cent, I'm very thankful that this government has finally realised that young people have trouble getting employment in Australia. It's taken you seven years to get to this point, to realise that this is a problem and to try to do something about it, but I suppose we should at least be grateful that you have recognised it. But what you are also doing in creating this scheme is creating an incentive for people not to employ people over 35.

As the member for Dunkley just explained in talking to her constituents—and I have had very similar circumstances in my electorate of Burt, where I have been out doorknocking or had people approaching me in my office my mobile offices to talk to me about the concern they have. Largely, people over the age of 50 who have either become unemployed or have been retrenched because of the recession we are in now are very concerned that they will literally never have a job again. This was a problem before COVID. This was a problem that was made worse by this government in its 2014 budget cutting the support program that helped people over the age of 50 get into employment. This government's solution was to remove that program. Now, when we're confronted with the first recession in nearly 30 years, the government's response is a program that will only help people aged under 35.

I don't take anything away from helping them, because they desperately need it, but what about the 928,000 people aged over 35 who are unemployed? That is nearly a million people that you're not going to provide support to to re-enter the workforce.

We combine this situation with the JobSeeker Christmas cliff. If there were ever an example of a government being the Grinch, it is this government here. This government's current position is that, when we get to just after Christmas, for those who are unemployed—that's the 928,000 people aged over 35, for example—not only will there be no further assistance to try and help them get back into the workplace; they will return to a situation where they are only receiving $40 a day in JobSeeker payments. That is a situation that not just welfare agencies, not just community not-for-profit organisations, not just peak welfare organisations but nearly every economist and business organisation in this country has been telling this government for years is fundamentally flawed and wrong. And the government says, 'Oh, well we expect unemployment to reduce; therefore, we can reduce the amount that is paid for JobSeeker.'

I think the government needs to wake up to what it is really telling people when it says that. What the government is saying is that it wants to solve a political problem. It's more concerned about the rate of JobSeeker, not whether it will mean that people live above or below the poverty line, not whether they're able to put food on the table for their children, not whether they're able to support themselves and pay rent. No, they're just concerned about how, if there are too many people on unemployment, it may mean that it becomes a political problem for the government.

It's a welfare system. It's a safety net. Make sure it's an actual safety net. Having a safety net under the ground doesn't stop you hitting it. It is supposed to catch you when you fall. So the government has said in its budget to say to the Australian people, 'We know that it delivers a result under the poverty line, but we will still reduce it down to under that as we see things progress—in fact, just after Christmas.' As I said, this government is the Grinch when it comes to JobSeeker.

Then of course all of these things are on top of the other support you would expect might be there to help people get back into work. So they have suddenly worked out that maybe they should do something for TAFE after they have been cutting funding from TAFE. They want to make getting into university more expensive at a time when people are going to be more interested in retraining and getting a qualification to give them better prospects of getting a job.

As I mentioned before, because I know the minister at the table was very concerned that I stay very tightly relevant to this legislation, this particular piece of legislation is also effectively an admission of failure of the previous programs that the government had in place to support young people back into work. I know that as a fact because, when I go around my electorate, as I said, 15 to 20 per cent of young people are unemployed. So clearly what you were doing before was not working. But, in addition to that, you've designed a system—and I really want to focus on and belabour this point—where you haven't told us what the design of the system is. You assure us that this system will not result in employers sacking older workers to employ younger workers, but you haven't told us anything about how you're going to police that. You tell us that it won't create perverse incentives in the labour market, but you can't tell us how it is going to do that or not do that. And you have set up a system, like JobKeeper, where you've asked for our support. You said, 'Can you write us a blank cheque so that for the next two years we can do whatever we want to try and support these different employment credits?'

It was understandable in the heat of a crisis, as we were with JobKeeper—when you were a month late and we'd told you to do it before—that instead of tying things up in legislation when there was a critical question mark over whether this place could meet we gave the Treasurer the power to write the Treasurer's rules on JobKeeper. We are not in that situation now. We could literally debate detailed legislation on this for the next two weeks and not hold it up, because the Senate doesn't meet until November. Yet you want us to write you a blank cheque. Seriously! King Henry would have been galled to see what you are trying to get through this parliament to that extent. If a Labor government walked into this parliament and said to a Liberal opposition 'We've got a great idea: we want to be able to provide additional support for hiring of Australian workers, but we're not going to tell you how much it is going to cost and we can't tell you what the rules are going to be, but that's okay; just give us all the power,' I don't think you would see anywhere near the goodwill that we are giving to you as a government, because we understand the importance of trying to support workers and unemployed people back into work.

For all of the rhetoric from this government, it is actually continuing to fail to deliver. It all comes down to this fundamental point. While Labor want to see young Australians supported, we want to see all Australians supported through this crisis—through the health crisis and through the economic crisis. We want to see a return to employment in this country. But what we have been delivered by this government, time and time again, is that they are all photo-op and no follow-through.