Budget - Jobs, Education and Healthcare

13 September 2017

House of Representatives

Wednesday 31 May 2017

A federal budget is more than just a financial statement. Any federal budget should be about national priorities, fairness and a better life for all Australians, whoever they are and wherever they live. As much as commentators might be captivated or captured by the budget's headline numbers, the most important focus of any budget must be how those big numbers and big changes affect people. I am proud of my communityof how we have faced the challenges and transformations of the last 30 years and how, as a community, we have decided it is our time to thrive. We are now well on the way to becoming the ninth-largest urban centre in Australia, with a population of nearly 400,000, including 21,000 local businesses, a university, major teaching hospitals and a growing number of new homes.

Like every other part of Australia, the Central Coast looks to the national government for a fair deal, and where there are special problems, such as those associated with rapid population growth, we expect that the Commonwealth will help in addressing special areas of difficulty or disadvantage. For much of the Central Coast, rapid population growth, the proximity to Sydney and its overheated property market, lack of infrastructure, long commutes, above-average rates of youth unemployment and relatively poor high school completion rates are enduring concerns. Those too ought to be a top priority for any governmentstate and federal, coalition or Labor. As my colleague the member for Macarthur remarked, this budget spruiks better times ahead whilst doing very little to assist their arrival. Yes, world economic conditions are expected to improve over the next year or two, and our domestic economy may benefit from thatlet us hope sobut this budget does little to stimulate domestic growth.

Outside of reannouncing old programs or promising yet more feasibility studies, there is little new in this budget to address the chronic problems experienced in our regions. The housing policy unveiled on budget night is no more than a collection of rats and mice nibbling at the edges of real community concerns. Total business investment levels are flatlining and, worryingly, there is already some fall-off in housing construction and retail sales. The government seems disinterested in our burgeoning levels of private debt, which are being pushed to record levels by a combination of low interest rates and overly generous, and budget-draining, federal taxation concessions. Treasury, though, expects that private debt levels will rise further, notwithstanding its own seemingly optimistic predictions that wages growth will nearly double by 2020-21. Unemployment is expected to remain at around 5.5 per cent nationally, well into 2019. On the Treasury's own numbers, this government will have made no dent whatsoever in the unemployment rate.

Underemployment now stands at an all-time high, and the proportion of workers who have been continuously unemployed for longer than a year remains stubbornly high. Youth unemployment nationally for 15- to 24-year-olds is just over 13 per cent, higher than when Labor was last in office. In my community, where there are more limited job options for young people, youth unemployment remains at 16.6 per cent, several points above the national average.

Those with healthy memories will recall that, for much of the last 30 years, various coalition figures have argued for greater labour market flexibility. Many of their fellow travellers have been even bolder and called for cuts to real wages, the argument being that people were pricing themselves out of work. We hear less of that now. Wages, including minimum wages, have been growing slowly, and the wages share of the economy continues to slide, while the profit share continues to climb. Both those trends have accelerated in the last two years. Neither has produced a jobs bonanza.

What we now have is a harsher, less fair and less accountable labour market than the one I joined in the 1990s. It is a hard slog, and predatory training providers are not making it any easier. Maggie was 19 when she moved from the South Coast to the Central Coast. Maggie searched for months for work, sending hundreds of job applications. Separated from her friends and her old life, she was lonely, but, worst of all, her self-esteem suffered. One day, when browsing online for jobs, she was approached by Careers Australia. Almost unknowingly, she found herself signed up to a course. At the same time, she finally landed a job. She emailed the college to advise that she had no intention of undertaking the course and, when she did not get a response, she thought nothing more of it. That was until her first tax return came back with a notice of thousands of dollars of debt for a course she did not do.

I have also heard from Brendan, a keen musician who is vision impaired. He was enticed to study with Evocca College, but the coursework was clearly not designed for people with disability, and after a short period he withdrew from the course. Years later, he was shocked to discover that the experience had left him with a debt of $18,615.

Even those who completed their studies are adversely affected. The collapse of Evocca and, more recently, Careers Australia has left too many Central Coast students without a credible or complete qualification.

Penalty rates are under threat; the workforce is more casualised; and many, many more of those studying have taken up part-time jobs just to stay afloat. At the same time, student fees are being increased, and the threshold for the repayment of HECS-HELP debts is to be dropped to $42,000. Many young people just entering the labour market will find themselves struggling to meet these big new retrospective taxes. It is worth noting that in many cases students now pay up to 85 per cent of course fees. We have moved a long, long way from the days of free tertiary education under the Whitlam government or even the early years of HECS, when I was studying and the student contribution was on average about 20 per cent of course costs.

Nor have young people been the only ones caught in the crossfire. The decision to launch the umpteenth crackdown on welfare recipients will now be extended to older workers too. This too is based on the false premise that Australians are work shy. Over the last 30 years, we have seen massive increases in labour force participation amongst 55- to 59- and 60- to 64-year-olds. The numbers involved have almost doubled in the 60- to 64-year-old age group. Employment amongst young people has grown too because many of those studying are now also balancing work. We have close to the highest rate of unpaid overtime in the developed world.

But what we have seen from this is a redoubling of the populist rhetoric of so-called mutual obligation. Despite all the evidence to the contrary, and despite the cost to the budget of close to $900 million over the last three years alone, the government persists with schemes such as Work for the Dole and now proposes new job activity measures that have a poor track record here and elsewhere.

This government seems to have conveniently forgotten that its primary responsibility is to create the conditions in which employment will grow. There are presently around 750,000 Australians who are unemployed and a further million or so who want and need more hours. That compares with about 155,000 job vacancies. On those numbers alone, this government should stop blaming the victims and start worrying a bit more about how to create more employment opportunities here and now. That does not necessarily mean more job creation schemes, but it does mean paying closer attention to labour market weaknesses and identifying worthwhile infrastructure projects where population pressures are highest.

My community needs a government that is committed to creating job opportunities, not a government that cares more about providing tax cuts for big business. Labor has always supported tax cuts for small businesses with a turnover of $2 million or less. Almost every business on the Central Coast, in my region, is in that category. But with this budget the government has confirmed it is committed to a company tax plan that will cost around $65 billion, which is money that could be invested in schools, hospitals and infrastructure and not just handed to overseas multinationals. Worse, the government is happy to allow a cut to penalty rates for around 15,000 Central Coast workers, who face a pay cut of up to $77 per week from 1 July. Cutting penalty rates when the Central Coast is already seeing a slowdown in wage growth is a reckless decision that will cut deep into family budgets and hurt our local economy. There is little evidence that cutting penalty rates will create the new jobs needed to offset the reduction in take-home pay and purchasing power lost to employees.

In the electorate of Dobell, around 62 per cent of people of working age did not complete high school. Of those, the number who left school to take up a trade is significantly higher than in other areas. In Dobell, 58.6 per cent of people have vocational education qualifications, compared to the national average of 46.7 per cent. But this pathway, learning a trade and getting a job, is not well supported by conservative governments at a federal or state level. Overall, this government has cut over $2.5 billion from skills and training, and Australia has shed 130,000 apprentices. In the last 12 months alone, trade apprentice commencements have dropped to 10.5 per cent.

The National Partnership Agreement on Skills Reform, funded and delivered by the former Labor government, provides vital funding to states and territories to support TAFE, apprenticeships and skills programs. The agreement expires on 30 June this year, and the Turnbull government's own budget papers show that there is nothing to replace it. This will mean a cut of over $500 million in TAFE, apprenticeships and skills every year. In New South Wales this means a cut of $165 million a year. This will have a direct impact on local students. Wyong TAFE has already seen a number of courses cut, including the HSC, and staff placed under enormous strain. TAFE must be protected. Labor will do so by returning TAFE to its place as the backbone of our skills and training, guaranteeing two-thirds of that public funding for TAFE. This is in line with a similar commitment made by Labor in New South Wales.

State and territory governments across the country would argue, and not always without just cause, that federal government cuts to health and education have forced harsh savings measures on their budgets. Under this government, New South Wales public hospitals are $630 million worse off. The New South Wales Liberal government is pursuing a public-private partnership for Wyong hospital, despite it being against the community's needs and wishes, and without their say in the future of our community hospital. The federal government has a direct stake in Wyong hospital. Last year, around $111 million in federal funding was provided to Central Coast Local Health District, yet, as we have seen this week, leaked official documents show the government's task force looked at a proposal to combine current Commonwealth funding into a single pool covering public and private hospitals. This would see funding provided by the Commonwealth for public hospitals decrease and funding for private hospitals increase. Would Wyong hospital be slated for privatisation if the federal government were committed to funding public hospitals properly?

Our community wants Wyong hospital to stay in public hands. Around 25,000 people have signed petitions and more than 2,000 people have attended rallies, candlelight vigils and public forums. I have received dozens of phone calls, emails and letters. I heard from Bill, who worked with the Ambulance Service of New South Wales for 18 years. Bill wrote:

This hospital in many ways was funded by the community through its efforts of fundraising over a long period of time, so it should stay in the hands of the government and not be privatised. People are not fools. Promises made in the beginning that there will be no or little change are rubbish. Private operators want huge profits to pay executives and shareholders. Let's not be fooled again.

Budgets do many things. They set priorities and coordinate policies. It seems unbelievable that no-one seems to have taken stock of how this budget will impact millennials. If you are in search of a failure of policy coordination, you need look no further than this budget's treatment of anyone aged 15 to 35. They have the highest rates of unemployment and underemployment. They have amongst the highest effective marginal tax rates, on account of the proposed increase to the Medicare levy and lowering the threshold for the repayment of student loans. They have the most rapidly falling rates of home ownership of any age group, combined with stagnant wage rates, high levels of casualisation, a Newstart allowance that remains highly inadequate and the umpteenth crackdown on unemployment benefits. If you are a millennial, you would have to start wondering if this budget were something that the Centrelink robo-debt computer dreamt up while it was enjoying some downtime.

There is a strong argument for reinstituting a budget statement for women. One for young people might not be a bad idea either. Saying a budget is fair does not make it so. Communities like mine deserve a fair budget. They deserve a budget that meets their needs. They deserve a budget that is in the interests of our community. I will stand for our community each and every day to fight these harsh cuts that affect our schools, our hospitals and young people's training.