Speech by The Hon Scott Morrison MP

Launch of the Australian Institute of Health and Welfare’s ‘Australia’s Welfare 2015’ report

Location: Canberra


Thank you very much Mukesh and thank you to Kerry and to all of those who have had a role in the production of this very important work, I want to say thank you. My background and my training are as a socio-economic researcher for those of you who didn’t know and so I know something of the sort of work that goes into these reports and their importance. So I want to thank you very much for the opportunity and come here and formally launch this report today.

Can I also thank you Aunty Agnes for your very warm Welcome to Country. It always is such a warm welcome to country when we have been at similar functions together and I want to thank you for being here today and equally I want to pay my respects to elders past and present.

Mukesh can I also thank you and your board and congratulate you and your board on the work you do, not just in the welfare area and I am sure Minister Ley also very much appreciates the work you do on the health side of things. We met recently and the agenda of work that you have before you and the way you are going about it with Kerry I think is very impressive.

To Stephen and also to Diane it is great to be here with you at Common Ground. This is an exciting facility and I am very pleased to be here and am looking forward to having a bit of a look around afterwards. I was with your colleagues down in Adelaide last Friday at Common Ground and had a very good meeting there looking through the works and projects they are doing. The Common Ground model is a very exciting one, like many similar models whether it is the Foyer Projects or others, there is some incredibly innovative work which is being done in the social services area around the country. The innovation in social services is so critical to how we manage the very big challenges that we have going forward.

It’s a pleasure to be here to launch this latest biennial report because it helps us understand the complexity of the system which government has a responsibility to manage in partnership with the broader not for profit sector and indeed private sector which is increasingly involved. Can I pay my tribute to the Snow Foundation for what they have done here. Wherever I have seen projects like this yes there has been government support at all levels but there has always been a very generous philanthropic component as well. We really do need to laud the investments made for social impact by those philanthropists. There aren’t enough of them and they can be very shy because of the nature of their generosity but we should always respect and appreciate their incredible contribution and their generosity.

Our welfare and our social service system is an incredibly important national asset. It underpins the strength of our society, of our community and indeed our economy. It is one of those assets we have to manage sustainable and it is one we have to take responsibility for incredibly seriously as a partnership at all levels of government and all spheres. The Budget I have a responsibility for is some $154 billion, it is more than twice the size of the NSW State Budget. It is a Budget which requires eight out of ten income taxpayers to go to work every day to support, which they do and they want to do as we all do because we believe in the support that it provides. The expenditure continues to grow. Over the last ten years the real growth in expenditure for the whole social services portfolio, which goes beyond the Budget of welfare which is considered in this report, has been growing at 3.4 per cent. That is higher than the real rate of GDP growth over that period of some 2.8 per cent. That is going to continue, particularly in relation to government outlays, that growth in social services expenditure of around 3.4 per cent will be almost double general growth in government outlays over that period. So this will continue to be a growing and significant investment where there will be an increasing call on the taxpayers of this country. So we have to get it right, it has got to focus itself as well as it possibly can. The size of the Budget isn’t its merit, it is its effectiveness and its achievements and the impact that it has on the lives of everyday Australians.

It is also a pretty complicated system. It is a very targeted system – in fact our welfare system is I would argue the most targeted welfare system in the world. We don’t run a universal based welfare system in this country. Over a very long period of time we have run a very targeted system, far more targeted than our western democracy comparative countries and across the OECD. But the welfare system we run is complicated. We have some 54 supplements and some 20 separate payments. It is difficult to understand, navigate and administer. It is difficult for those who rely on it, it is difficult for those who administer it and it is costly to run let alone the actual outlays that are involved. It is operated by an ICT system with 30 million lines of code generating more than 50 million daily transactions. The payment system upon which this whole welfare system relies on was built and not largely changed since Peter Brock was winning Bathurst.

In order to progress our task of making the welfare system fairer and more sustainable, we have begun the process of overhauling the ICT system and creation of an investment approach to tackle the issues of welfare and to support Australians to become independent wherever possible and to ensure for those who cannot there is a reliable, adequate and sustainable safety net.

Why am I talking about computer systems here at the launch of a report such as this? It might sound a little tedious, it might sound a little micro but unless we have an ICT engine that can facilitate the sort of dynamic, flexible, bespoke approach that we all know who work in this area is necessary to have the biggest impact in terms of the investment and the connections we want to make with Australians to help them change their lives and for them to become more independent, then you need to have the tools. The system that Minister for Human Services, Marise Payne has embarked on is the biggest change to a payment system in terms of scale, scope and cost of anywhere else in the world. That system is going to ensure we can better frame policy, we can better implement policy and most importantly we can better know the outcomes of policy. That becomes the test of the spend; not just its size but its effectiveness and whether it is actually hitting the mark. In not for profit organisations like Common Ground here that is how they assess; based on who they are helping and how they are helping and the impact of their engagement. For governments it has to be more than boasts about how much money is spent, we have to get to the issue of effectiveness to ensure we are addressing the many issues that are contained in the report we are launching today.

This is backed by an Investment Approach, which many of you will be familiar with in terms of what has been done in New Zealand and in the last Budget we put in place around $20 million to build the actuarial framework so we can know where the interventions can be best placed, with the sort of work we are doing. Whether it is in homelessness and I agree with Mukesh if you don’t have stable housing then what hope have you got of actually having the stability necessary to get yourself in a position to deal with whatever life’s challenges are bringing you to get yourself into employment or get yourself into an independent space. The Investment Approach which we have begun the process now of putting in place will help us make the best possible interventions, which will ensure the best outcomes for people we are trying to help but also respect the taxpayer who is the ultimate donor to the system; the ones who are seeking the outcomes of which I speak.

There is good news in this report, not just challenges. There will always be challenges in this space. The report talks about the growth in new jobs in the services sector and particularly the community service sector. It talks about the fact more Australians are better educated than a decade ago and of course we can all celebrate living longer. I was on the Gold Coast recently talking to a fairly large senior’s forum and in great news we are all living longer and we are all living healthier – isn’t that tremendous? It means we are going to have to work a little longer too. The opportunity to continue to participate as we age and age healthier, be engaged in the workforce and be independent, is also the opportunity to engage socially and in other ways. This creates a rich life, it creates a rich community, it creates a rich country.

So these are great opportunities. Between 1984 and 2014 participation for the 45-64 age group rose from 41 per cent to 64 per cent. We all know that when older Australians bring their work and life experience to the workplace they make a tremendous contribution. It is very much our government’s intention to create the conditions for an Australian ageing boom. I honestly see the aging of the population as an opportunity not as a threat. It will see the creation and establishment of services and businesses – in our economy and our community – which will be a lead for the rest of the world who are dealing with similar challenges. If we get that right this will be an aging boom not an ageing bust and we will have the opportunity to take advantage of our demographics and not let our demographics take advantage of us.

The report raises other important challenges. In the area of housing in particular it notes that more Australians are renting, and while that of itself is not an issue necessarily, we have seen it raise from 18 per cent to 25 per cent. However what sits behind these figures is that Australian families, particularly younger Australian families, more of them are not in a position today like their parents were where they were in a position to be able to purchase a house or own a house. We are seeing families fall out of the housing purchase market and fall into the rental market. This is because housing affordability in this country is a serious challenge. It is a serious challenge and it is one we need to address holistically. The government is very committed to doing that. When I say holistically I mean all governments at all levels, I mean the private sector, I mean all sectors and it isn’t just about what is happening in the housing purchase market, it is what is happening in places like this and the innovation that needs to take place here.

The report finds younger people appear to be facing greater difficulty in transitioning to independence and vulnerable young people are at high risk of long periods of unemployment or disengagement. A fifth of young Australians aged 15 to 24 years were not fully engaged in education or employment while 10 per cent were not engaged in any education, employment or training. That is why it is important that our welfare reforms are geared to getting Australians out of welfare and into work. It is about giving people the choices back that come with work. Work, where that presents and the opportunity is there, is the best form of welfare for any Australian. The Government’s Youth Employment Strategy, which is part of the Jobs and Small Business Package in this year’s Budget, targets support specifically to groups of young people more susceptible to long term unemployment. That includes refugee and migrant youth, it includes youth who have a mental illness, it includes those facing intractable unemployment and dealing with the barriers are stopping them getting a job while also helping them stick in that job. That is where our reforms and our funding is focused – some $330 million has been put in to that in this year’s Budget alone.

Many of these young people, as is known here, are at risk of homelessness. The report records more than a quarter of a million people use specialist services for homelessness. More than 50,000 of them were young people aged 15 to 24. That is something that I was aware of when we made the decision that we were going to fund the National Partnership Agreement on Homelessness. That was funding that had to be newly brought to the table because there was nothing in the forward estimates that we inherited that would enable that agreement to continue. So that was new funding that was put it in. That $230 million I have asked to be targeted towards two top priorities by the states who administer and run the programmes – young people who are homeless or at risk of homelessness and families affected by domestic violence. These are the two biggest challenges in my view that we face more broadly and that reaches into indigenous communities and other areas as well. But those two areas are where I believe the national focus on homelessness should be placed. The Common Ground approach of providing a stable home and wrap-around services to help people become self-sufficient and independent in all aspects of their lives is the type of programme needed for a sustainable reduction in homelessness. The concept of partnership between not-for-profit, private and government sectors is also important and shows what can be done when we approach social issues as a whole of community responsibility. This is another important area where the government is focused.

The government’s decision to invest $3.5 billion into our Jobs for Families package through child care will deliver better outcomes both in terms of workforce participation but also to give families the choices they need. With more Australians participating in the workforce and more families relying on child care, as the report has outlined, has been necessary for us to have a wholesale reengineering of our system of support for child care. That is what the government has done over the course of the first six months of this year in bringing forward our Jobs for Families package. Almost half of all children aged 0-12, or 1.8 million children, were found to have regularly attended either formal or informal child care last year, while labour force participation rates have increased, particularly for women, growing from just 51 per cent in 1979 to 75 per cent last year. We are committed that that package but you have also got to fund that package, it has got to be affordable child care and it also has to be affordable for the taxpayer.

Sadly the report has once again reminded us of the ongoing vulnerability of our indigenous communities, especially indigenous children. While the proportion of indigenous children assessed as vulnerable, the report notes, has declined from 47 to 43 per cent that is still a dreadful figure, a dreadful figure. Indigenous children remain almost twice as likely as a non-indigenous child to be assed as developmentally vulnerable. The child care package has many facets but one of the areas I am most proud and pleased about is the Child Care Safety Net. The Child Care Safety Net is specifically putting additional resources into indigenous communities and indigenous support for flexibly delivered child care and early childhood education. As the Social Services Minister early childhood education is an opportunity to change the game for young indigenous children in particularly but children experiencing disadvantage more generally. The statistics are overwhelming and that is why through our Child Care Safety Net package we have targeted additional assistance specifically to support Indigenous communities. Indigenous Australians also account for more than a quarter of our homeless population.

Now in concluding I couldn’t sit down without recognising two things that this report also recognises well and that is the wonderful role of carers and volunteers in our community. 2.7 million Australians, or 12 per cent of our population as found in the report, were informal carers and of these around 770,000 were primary carers. 71 per cent of these carers were co-resident with the loved one they were caring for and while the overall percentage is slightly down in terms of the number of carers the value of the role played by carers, particularly those who also struggled with this on low incomes is incalculable. It is almost and I would say equally as incalculable as the love they share for the person they care for.

Quite rightly the report notes Australia’s long and proud tradition of volunteering; the benefits to be gained through unpaid community involvement, and that the trust and personal satisfaction coming from helping others is alive and well in our community. But it must be recognised and it must be supported. In my own community, the Sutherland Shire in Sydney, we have a proud history of volunteerism. The Government values what volunteers achieve because without them we wouldn’t have the strong, cohesive and resilient communities that are a hallmark of Australian society. One of things we have to be conscious of when we look at the report that we have today is that we all pay our taxes. That is the law. Paying our taxes is not an excuse not to go the extra yard on volunteering or philanthropy or supporting worthy causes and all the rest of it. Fortunately I think most Australians share that view. If we could do it a bit more regularly so organisations, not for profits and others could plan on that support on a more ongoing bases – we tend to do it a bit sporadically we will see a need and we will respond to that need and that is a tremendous part of the Australian character and spirit. But what this report shows is these needs are there every day, every single day and the government’s support through the various programmes we run is there every day. As Australians we always need to do more than just pay our taxes when it comes to building the strength of our community and our society and that is the overwhelming disposition of our community. It is something we should celebrate and it is one of our unique Australian values and it is something that I think as a result of this report we can only encourage ourselves to go further with.

With that I am very pleased to launch the Australian Institute of Health and Welfare’s biennial report, Australia’s Welfare 2015. Now we look forward to getting to work on dealing with the issues that are contained in it. Thank you.