Welfare system – Sky News
E&OE
NEWSREADER:
Take you live now to Adelaide. Social Services Minister, Kevin Andrews.
KEVIN ANDREWS:
…if he had done so, he would have seen that Mr McClure, in his welfare reviews, is not looking at the aged pension. Mr Shorten seems to want to have a scare campaign every week. Last week he was suggesting erroneously that the Government was proposing additional payments when people go to the doctor. Dead wrong. This week he’s suggesting that McClure is looking at the aged pension. Dead wrong.
QUESTION:
So you can absolutely rule out – whether it’s been looked at in the review or not, you can absolutely rule out any changes or cuts to the aged pension?
KEVIN ANDREWS:
The Government is not proposing to cut the aged pension. This review is about the long term sustainability of our welfare system. It’s not about pushing people off income support payments who are currently on income payments, but it’s about looking at the very significant demographic change which is occurring in Australia, the rapid ageing of the population, the fact that that means that there will be more older dependants in particular in 10-15 years time and the very significant shrinkage in the growth of the workforce.
These are medium to long term challenges which Australia faces and any prudent government would be looking at how we can sustain the system into the future so that people who need welfare will be able to continue to get welfare.
QUESTION:
Among potential changes, you believe it’s reasonable for someone on unemployment benefits to have to travel further for a job?
KEVIN ANDREWS:
Well, this is one of the things which I expect Mr McClure will look at. We know that in capital cities in Australia, for example, that many people travel an hour, an hour and a half, even more to work as just part of their normal employment. So whether the 90 minute rule, which exists at the present time continues to be appropriate is something that Mr McClure will look . Obviously he will report back to us and the government will consider any recommendations which he makes.
QUESTION:
What do you think is reasonable? Do you have any ideas? Would expect someone living in Adelaide to maybe travel to a mining town to work? Is it fair for them to, you know, uproot their family and make major changes like that?
KEVIN ANDREWS:
Well, the Government is already putting in place policies that will enable people to shift from a metropolitan city like Adelaide to a regional area. We’ll provide an extra $2500 if they move and stay in a job for 12 months, and if they stay for two years we’ll provide an extra $4000 on top of that. In addition, if they have a family, they may be eligible for further payments. So this is an example of how we can encourage people to actually take a job away from where they might normally do, but we recognise that there are costs involved in doing it.
QUESTION:
If someone didn’t want to take those benefits though, they potentially cut off the system.
KEVIN ANDREWS:
Well, that’s not the proposal. This is about enhancing the opportunity to go and take a job. Equally we’re saying for employers, if you’re prepared to employ somebody over 50 who’s been on income support for six months or more and that person stays in your employment for six months, we will provide $3250. Again, this an enhancement to try and get more people into work and why are we doing that? Because the ageing of the population means that there’s a contraction in the growth of the workforce.
A study a few years ago showed that for the entire decade of 2020 to 2030 we would see a growth in the workforce right across Australia of only about 125,000 people. Now, that’s a very significant change and we have to start planning to meet those sorts of futures which Australia faces.
QUESTION:
As a minister you earn over $300,000 a year. Do you think you could live on a Newstart Allowance?
KEVIN ANDREWS:
I think the Newstart Allowance is very difficult for people who work to live on. One of the things which Mr McClure will look at is whether or not we should treat everybody on Newstart as one cohort, one group of people, because we know that for many people on Newstart, the allowance actually serves in the way in which it’s described, to give them a new start, to give them a chance, and most people actually go – who go on to Newstart, go off within about six months of going on to Newstart.
Now, there’s another group of people who stay on Newstart for a longer period of time. Indeed, in some instances years at a time. And one of the things we need to do is to look at whether or not there are different circumstances for these groups and how we go about that. But having said that, we are in a very difficult budgetary situation in Australia. The reality is that we have inherited the largest Commonwealth debt ever in the history of this country. We’ve seen Labor run up deficits year after year after year and we have to do something about that as well.
So things that we might like to do in normal circumstances are much more difficult when we as a government are facing this huge debt.
QUESTION:
Are changes to the disability pension being looked at and do you think it’s too easy for people to get the disability pension?
KEVIN ANDREWS:
Coming back to the question of the disability pension, one of the things that we know that’s occurred over two, maybe three decades now, is that because the rate of the disability pension is indexed differently to the Newstart Allowance, the payments have grown apart, and that means that for certain people there is a perverse incentive to get on to the disability support pension rather than on to Newstart.
Now, that’s not something that can be fixed overnight, but equally we know that there are some people that if we could give them additional assistance at the time that they might go on to the DSP, they might be able to do some part time work, and obviously work is the best form of welfare for a whole series of reasons. So again, this is something Mr McClure is looking at.
QUESTION:
And will these changes be in the budget?
KEVIN ANDREWS:
Look, it’s much too early to speculate about what might be in the budget this year. We’re still months away from the budget. This is something which was prudent to do. Mr McClure had looked at the welfare system in Australia about 10 years ago. As the former head of Mission Australia he’s eminently qualified to look at these things. He’s been closely involved in helping people find employment in Australia over his working life, and this is giving him a chance about a decade later to come back and look at the recommendations he made in his previous report, to look at what’s happened in the meantime, and to put this against the context of the rapidly ageing population that we face in Australia.