Budget 2011-12 – Getting Australians ready to work
The Gillard Government will create opportunities for more Australians, particularly the disadvantaged, under a major workforce participation package.
Australia’s economy is strong, with one of the lowest unemployment rates in the OECD.
The Government believes all Australians, regardless of their circumstances or where they live, should be able to share in the benefits of this strong economy, and enjoy the financial and social benefits of work.
Building Australia’s Future Workforce is a package of measures that:
- Rewards work through improved incentives in the tax and transfer system;
- Provides new opportunities to get people into work through training, education, and improved childcare and employment services;
- Introduces new requirements for the very long-term unemployed, Disability Support Pensioners, teenage parents, jobless families and young people; and
- Takes new approaches to address entrenched disadvantage in targeted locations.
Australian industries need more workers and many Australians need work.
Through this package the Government will reach out to disadvantaged and marginalised groups to ensure they have access to new opportunities.
In this package, the Government will:
- Change the tax arrangements to improve incentives to work across the economy, especially for low and middle income earners. The proportion of the low income tax offset (LITO) that is delivered through workers’ week-to-week pay packets will increase from 50 per cent to 70 per cent. We will also reduce disincentives for secondary earners to work by phasing out the dependent spouse tax offset for those aged 40 or under.
- Make sure young people have the right financial incentives to train, study or work, rather than remain unemployed by delaying access to Newstart by one year. This will mean that 21-year-olds get the same payment rate whether they are training, looking for work or studying. The income-free limit and working credit will also be improved for those 21 and under, rewarding work. The Government will also provide additional transitional support to assist early school leavers gain basic skills they need to move into work or further training.
- Ensure single parent families are rewarded and supported to re-engage in work by reforming the income test for single parents who are principal carers of their children on Newstart Allowance, changing the taper from 50 or 60 cents in the dollar to 40 cents. Single parents will also receive better support services and more access to training. With opportunity comes responsibility, and we will encourage more single parents of high school aged children to return to the workforce by gradually phasing out grandfathering arrangements for Parenting Payment recipients with a youngest child aged 12 to 15, to make eligibility more consistent with other single parents of teenagers.
- Require the very long term unemployed to participate in more work experience each year, for 11 months rather than six months under current rules. We will also provide employers with incentives, including wage subsidies, to give the long term unemployed a go.
- Allow people with a disability to work more without jeopardising their benefits as well as introducing new requirements for younger people aged 35 and under on the disability pension with some capacity to work to develop participation plans with Centrelink. These plans could involve undertaking programs with employment services, training, rehabilitation or volunteering. The Budget will also fast track new rules requiring new DSP applicants to access employment assistance and try to get help to work before they apply for the DSP.
- Recognise the skills of older workers and provide more support so they can gain formal qualifications and re-enter the workforce.
- Take a new approach to addressing entrenched disadvantage by targeting some of the most disadvantaged locations in the country. In these 10 locations, the Government will provide new services, opportunities and responsibilities to boost the job readiness of families with young children. Jobless families and teenage parents will have new participation requirements to develop their skills, and make sure that their children get a good start in life. Income management will also be expanded in five of these sites to help stabilise dysfunctional families and remove barriers to participation in community and work.
Building Australia’s Future Workforce is designed to lift the skills of our workforce today and into the future and to provide disadvantaged Australians with the life and work skills they need to ensure they are not left behind.