Social Security Legislation Amendment (Youth Jobs Path: Prepare, Trial, Hire) Bill 2016

13 February 2017

Unfortunately, unemployment in our nation is an issue that disproportionately impacts on young people. Youth unemployment is at double the national unemployment average—that is, nearly 300,000 young people across our nation are unemployed. We all know that this is an unacceptable statistic and, sadly, it is rising. But the primary cause of this unemployment is a lack of economic growth. Low-skilled and inexperienced young people are particularly vulnerable to these conditions in the job market. There are poor economic growth in particular pockets around our nation where this is a problem.

It is a particular problem in my home state of Western Australia, where youth unemployment, I am sad to say, is reaching crisis point. The unemployment rates are still above global financial crisis levels. In some parts of Western Australia, unemployment is more than double the national average. All over my home state of WA, people are feeling it, from our southern metropolitan suburbs like Pinjarra, Mandurah, Rockingham and Kwinana right up to northern suburbs like Yanchep, Wanneroo, Joondalup and through our wheat belt region. This, I believe, is because the Barnett government has squandered our mining boom. It has hollowed out our economy. It did not invest in jobs and training for the future, and young people in WA are now, very sadly, paying the price for that.

This is very much why I am glad to see the work that Labor has done, with Bill Shorten and WA opposition leader Mark McGowan announcing in Perth earlier this month that they are working together on that job creation. It is about diversifying our economy and ensuring that we have jobs for the future. What we have seen under the watch of the coalition, both at a state and at a federal level, is a complete lack of commitment to diversifying the economy and looking to the industries of the future. My good colleague Senator Doug Cameron's remarks really highlight that.

What we want to see in our nation is an opportunity for people to go to university or TAFE being confident that they will have a high-skilled, well-paid job at the end of it. What we have seen in our nation is a government in Western Australia that has been very focused on making sure that these jobs, frankly, go offshore. Each year they send a list here to Canberra promoting overseas workers into Western Australia in traditional trades where we already have large numbers of unemployed people back home. The Liberals are continuing to send these jobs overseas. The latest example is the Malaysian footbridge. That bridge could and should have been built in Western Australia, and the fact that the WA Liberal government contracted for that bridge to be built overseas is a disgrace. I cannot really fathom why the state government would do that when workshops in our home state are empty and young people are in desperate need of work. So I am really pleased to highlight the state Labor commitment to putting local jobs, training and apprenticeships at the heart of everything we do.

This stands in stark contrast to the legislation before us tonight. What we really want to see are commitments like making it law that government departments, including health, education, transport and housing are required to provide more apprenticeships for local people; and putting in place Western Australian industry participation plans that require as a part of all bidding processes for construction work across government a consideration of apprenticeships and traineeships. These are the commitments that state Labor has made in Western Australia and these are where you will find solutions to youth unemployment nationally, not in the kind of misplaced legislation that we have before us tonight. These are the real solutions to unemployment in our nation. They are the right approach. This is the approach that you should be taking at a national level.

But, sadly, where is the Turnbull government on this question? In our country we need a solution to unemployment that is much better than the lazy policy approach that simply provides employers with free Labor. That is the solution you have put forward in this place. We need a solution that goes beyond your mantra of jobs and growth. We keep hearing this from a government—that their priority is jobs and growth—but, sadly, you are failing on this front. You are failing to tackle unemployment, which is why you are creating in the legislation before us these proxy jobs that are not real jobs at all.

Our nation is desperate for solutions to unemployment. I meet young people all the time in Western Australia who are extremely concerned about their future. This bill is not providing a solution for them. The introduction of a 12-week internships for jobseekers is a major change to employment program arrangements, and it is one that needs to be scrutinised very carefully by this place. It is a major change that should not be introduced until the concerns of the community have been resolved, as Senator Cameron outlined.

We have before us a really poor attempt at resolving the issue of youth unemployment. It will not improve outcomes for jobseekers. It is unlikely that it will make a difference to the unemployment rate for young people in our country.

The government is claiming that the measures in this bill are non-controversial, but in actual fact they form part of a much broader new program design that undermines the workforce standards that we here in Australia hold dear. A similar program in Ireland has been discontinued and one in the UK has been the subject of much controversy.

In theory, what we have before us is something that is supposed to prepare young people for work by providing young job seekers aged 17 to 27 with pre-employment training and placement in voluntary internships of between four and six weeks. In this time they may work from 15 to 25 hours a week and will receive bonus payments of up to $200 a fortnight on top of their current income support payments. If you do the maths on that, an intern who works 25 hours per week but receives only their Newstart payments plus an extra $200 payment will earn just $14.50 an hour, and that is $3.20 less than the minimum wage. This means that young people participating in this program will be paid less than the minimum wage. Young people who are working, providing value to employers, contributing to a workforce and contributing to our economy will be paid below the minimum wage. This is simply not good enough.

If someone is working they should be paid properly for that work, regardless of the circumstances. If a young person is going to be making any meaningful contribution to an employer they should be fairly remunerated. This has been and should be a basic tenet of workplace rights in our country. What we see here, sadly, is a classic race to the bottom attitude. It is an attitude we have seen time and time again from this Liberal government and the ones who came before them.

What we also see here in the race to the bottom and the displacement of wages is the displacement of young people who would be paid properly to do those jobs. As Senator Cameron highlighted, there is nothing in this legislation that provides any guarantee that what you are putting forward is just providing a cheap labour subsidy to employers while displacing real people from real jobs. So this is not a fair deal for young jobseekers. In fact, it could make the situation much worse. It opens the door to the exploitation of young people who are already vulnerable and often in desperate circumstances. There are no restrictions on the times that interns will be required to work, leaving them open to working beyond ordinary working hours, with no penalty rates in recognition of evening or weekend work.

Interns under this program will not be classified as employees and, such being the case, will not be covered by occupational health and safety laws. What an appalling part of the legislation before us. This puts their safety at significant risk. It means there is no guarantee of a right to workers compensation should an intern injure themselves at work. It also seems that there are no provisions for checks to ensure that workplaces hiring interns are meeting health and safety requirements. We should not be allowing our young people to enter into the workforce without adequate protections for their health and safety.

This program also provides little protection from unfair dismissal. Increasingly, we are seeing people in our country, especially young people, feeling less and less secure at work. This is something that government should be addressing by providing more secure employment. There has been no detail from the government on what the work will actually entail. They cannot even tell us whether the participants will simply be observing the workplace or actually working.

There are also no assurances that employers will not be able to take advantage of the program. What is to stop employers cycling through young interns every 12 weeks to make the most of free labour and incentive payments from the government? We will see young jobseekers across the country stacking supermarket shelves or washing dishes in restaurants for below the minimum wage, gaining no skills, and with no extra incentive for the employer to keep them on long term or provide them with any training. Is this what this program will see? And, whilst the program opens up the potential for these kinds of exploitation, there is no provision for advice or support for young jobseekers going through the program. It does not outline how participants will be supported to get to and from their internships or the required training. Travel costs have the potential to be a huge burden on young jobseekers, particularly from our outermost metropolitan or rural areas and the areas that most need that support. Other additional costs such as appropriate workwear or safety gear are also a consideration for how they will be able to meet the costs associated with the program. I am looking forward to an explanation from the government on these issues.

What we want is a fair deal for young jobseekers in the legislation before us, but I do not believe that is what we have. It is putting existing jobs at risk, with the potential for existing workers to be replaced with cheaper labour. While the government claim that internships will be monitored to ensure that this churn will not happen, it is not clear how they are actually going to do this. There is no limit on how many participants can be used in any one company, so there is nothing stopping employers from using interns to complete their work rather than using permanent employees. This has the potential to undercut the workforce and force even more people into unemployment. We have no sanctions for employers who do this. What is to stop employers using this legislation and this program from using free labour instead of their existing workforce? Why would an employer pay their existing workforce weekend or night time penalty rates when they can use an intern under this program who is being paid by the government not only below the applicable penalty rates but below our country's minimum wage? The PaTH program could allow all of that to happen.

In addition to all of those issues there is no evidence that the program will even work. There is no provision for evaluation or review—no standards by which to measure the success of the program. The program also does not specify where or how participants will acquire the necessary skills to gain long-term employment. Evidence shows that formal training providing skills and knowledge is the key to better outcomes for jobseekers. In order for a program such as this to be successful, the training provided must be meaningful and linked to jobseekers' work experience. There are many such programs that have proven their worth in our nation's history, but it is an area that has not been adequately considered in this program.

As I have already said, in the UK a program similar to this was introduced in 2013. Fewer than half the estimated placements were made, and, I am sad to say, there was no identifiable increase in real job placements as a result of that. I really do not see how, as result of adopting a failed program here in Australia, there will be a different outcome. What we see is a program that has been put together quickly and without the thought or consultation that is required. Rather than quickly putting together a program with no long-term plan for its success, the government should be delaying the implementation of the program and be clear about the program's objectives, as well as providing proper evaluation and review processes. These elements are captured in the motion that Senator Cameron moved this evening.

The program we have before us looks like it has been designed to be a quick-fix solution to cover up the government's failure to fix unemployment in our country. It is being used as an excuse to cover up the failing of other government job programs, such as Work for the Dole. Work for the Dole programs required young people who were unemployed for more than six months to participate in an approved activity for up to 25 hours a week for six months of the year. These programs, which paid participants only $10.40 a week on top of their income support payments, have demonstrably failed at getting people into paid employment. The government's own figures show that 90 per cent of Work for the Dole participants are not in full time work three months after finishing the program. Irrespective of whether participants have been in or out of the program, their employment prospects are probably much the same. What we lack is real training, real engagement and real jobs for these people.

While this program shows some improvements on the Work for the Dole disaster, such as increasing the wage bonus to $200 a week, it is not ready to be implemented and it does not adequately protect the rights of young jobseekers in our country. This program is diverting funding from one ineffective program to another ineffective—and potentially exploitative—program. The government could fix some of these issues by increasing the rate of the bonus payment to meet the minimum wage, by decreasing the maximum hours worked, by ensuring that workers are covered by workers compensation, and by making the objectives clear. These are all things that Senator Cameron has called on the government to do.

This all really does beg the question: why has the government refused to do this? I guess it comes down to the government's appalling record on jobs. They are a government that time and time again have attempted to undercut the rights and conditions of workers. We saw this with their attacks on penalty rates, we saw it with their anti-union ABCC agenda, and we saw it in their unfair public service bargaining framework. Again we see it here tonight in our chamber. The government show complete disregard for young people and a complete misunderstanding of the complexities of youth unemployment. Indeed, it was this government who were considering cutting all benefits for jobseekers for six months while they were looking for work. What an appalling thing to do. Here in question time today we had a rush to come to the aid of farmers in need but not a rush to come to the aid of young jobseekers facing unemployment. It seems like the government have a framework for the worthy and unworthy poor in our country, and it is one that I very firmly reject. It is a disgrace for this government to say that young people have an obligation to look for work, whilst taking no obligation themselves to create jobs so they can find that work.

In conclusion, this Youth Jobs PaTH Program is an ill-considered, ineffective and potentially exploitative response to the growing issue of youth unemployment in our country. Young people in our country deserve better than this. Labor is demanding a better deal from this. Labor is calling for the PaTH program to be deferred until the issues we have raised and the issues the community have raised have been squarely addressed. Continuing with this program despite its obvious flaws is doing a disservice to those people who are in desperate need of a real solution to unemployment in our country. This program, introduced by Prime Minister Malcolm Turnbull, is not creating jobs. It does not give young jobseekers the skills and opportunities they need for long-term work. This program is simply subsidising employers to place jobseekers into cheap work with no protection.