Earn or Learn, DSP, Welfare Review
MINISTER:
Ladies and gentlemen I want to take the opportunity this afternoon to make a few comments about some speculation about welfare in the forthcoming budget and to confirm a number of other proposals which the government will be taking in the budget on Tuesday night.
The first is that we will be looking to a system of Earn or Learn for young Australians under 30. We believe that young people should either be working but if they’re not working then they should be in training, whether it’s a tafe college or a vocational certificate, they should be working or in training to try and get themselves in a position to work, and earn or learn will be the Government’s approach for young people under 30.
Secondly, in relation to disability support participants, we will be making a couple of changes. The first is that those who have gone onto the DSP in the last five or six years who have not been assessed under the new impairment tables, that those people will be assessed under the new impairment tables to see whether or not they are capable of working and if they are capable of working, whether it be full time or part-time, then our expectation is that they should working.
And secondly for DSP recipients under the age of 35, currently there are some provisions that they have to go along and have an interview with a job service provider. We don’t think that is sufficient, we think there should be participation requirements for people under 35 if they’re capable of working. Obviously if they are profoundly or severely disabled and not capable of working well then they shouldn’t be working but where there is a capability of working, they should not only have to go along and have an interview they should have some job search requirements like other young people do.
The message out of this is simply this, the days of easy welfare for young people is over. We want a fair system, but we don’t think it’s fair that young people can just sit on the couch at home and pick up a welfare cheque and as I said those days are over.
Secondly in terms of the progress of welfare review, what’s in the budget on Tuesday night is simply the first instalment of what the government is proposing. As many would know Patrick McClure has been working on a discussion paper and that has been completed.
I’ve asked Mr McClure if he’d look at it again in light of the announcements made in the budget and then I intend in the week or two after he’s looked at it again, the week or two after the budget, to release the McClure discussion paper. There’ll be a period of consultation with the general public and others who have an interest in welfare reform in Australia, including those that are recipients and the advocates of the various welfare groups in the country.
Mr McClure will then report back to me in August of this year and I will then look at the recommendations that come from his second review and I will be taking to the Cabinet further proposals of welfare review. This will go to the structural arrangements, the way in which the welfare system operates in Australia. Today there are some 50 payments, allowances and supplements. It’s basically a system that has been built on ad-hoc decision upon ad-hoc decision over the years, and it’s time to have a clear look at making structural change so far as welfare is concerned.
Coming back to the announcements that will be made in the budget on Tuesday night, the message is clearly this. The days of easy welfare for young Australians is over. We expect people who are capable of working to be working and if they’re not working then be getting training to put them in a position to be able to work. We all have to roll up our sleeves and rebuild this country so that we can ensure we have the prosperity that we want in the future.
QUESTION:
As far as the DSP how many young people will actually be reassessed?
MINISTER:
Well that will depend on an assessment of numbers, but we’re looking at possibly somewhere in the order of 10,000 to 20,000 people that could be reassessed. Now obviously we will ensure that those who are not capable of working are not within that but there are people who have partial work capacity, partial ability, and obviously for those people we want to look at whether or not the best thing for them would be to actually be in the workforce.
QUESTION:
Why have you targeted a particular group though, especially considering it’s… (inaudible)
MINISTER:
Well there are 800,000 people on the DSP, all the evidence is that when a person has been on the DSP for a number of years their condition has deteriorated such that reassessing them wouldn’t bring about the same result. Whether their physical condition has deteriorated, whether their psychological condition has deteriorated, if a person has been on the DSP for six or so years or more the evidence that we have is there would be no point in reassessing them because the deterioration has already occurred. So what we’re on about is ensuring that people who are capable with some encouragement of getting work, that we can help them get into work.
QUESTION:
Mr Andrews you mentioned evidence. Is there evidence to suggest that young people on the pension are bludgers and where is that evidence?
MINISTER:
Well we know that many young people want to be able to work, and that’s what we want to encourage them to do but if there are people who think they can just have an easy life and the taxpayer can pay for them whilst everybody else in the country has to work then as I said those days are over. We’re no longer going to support easy welfare for people who just want to sit around on the couch at home when they are capable of either going out and getting a job or, at the very least, going and doing some further training to get a certificate, for example, that they could then take up a job in the community.
QUESTION:
Is the Government going after some of the most vulnerable people in the community?
MINISTER:
Young people are not necessarily the most vulnerable people in the community; young people have got their lives ahead of them. That’s why we are saying we don’t want a situation where people can just sit around when they could be getting the skills, if they haven’t already got them, to ensure they have a job in the future. That’s the best thing for them, it’s the best thing for them psychologically, it’s the best thing for economically and obviously it has very significant advantages so far as the whole community is concerned.
QUESTION:
Mr Andrews is this an aim to get them off DSP and onto Newstart?
MINISTER:
Well the aim is not so much to get them off DSP onto Newstart. The aim is to say that if people are capable of making a contribution, people are capable of working even on a part-time basis then we should be encouraging them to work and that’s what we’ll do. At the same time we are putting in place, rolling out the National Disability Support Scheme (NDIS) which is going to cost billions of dollars that’s particularly aimed at those people who are profoundly disabled, who in many cases are not capable of working. So whilst we’re doing that on one hand on the other hand where people who are capable of working we want to encourage them to work.
QUESTION:
How much do you think this will actually save?
MINISTER:
Well this is not so much a question about saving; it’s about ensuring that Australians who can contribute, Australians who can actually work should be in work. Yes it does cost for people to be on Newstart, it does cost for people to be on welfare and I think ordinary Australian taxpayers would take the view that we should have a welfare system, that we should have an adequate safety net, but by the same token they shouldn’t be paying for people who are also capable in the community of actually contributing, that is working.
QUESTION:
Do you have a figure though, a ball park figure at least, of what you think you think you’ll make as far as savings?
MINISTER:
Not at this stage because this is the first phase, if you like, in terms of the ongoing welfare reform and if anybody thinks what is announced in the budget on Tuesday night is the end of welfare reform under this government that is not the case. It’s the first stage, the first phase and as I said in about six months or less we’ll have recommendations back from the McClure Inquiry having gone through the consultation period and as a result of that I’ll be taking to the Cabinet further proposals for the restructure of welfare in Australia.
QUESTION:
What’s wrong with family doctors actually making the assessment, were you concerned that was being taken advantage of?
MINISTER:
Family doctors generally don’t make the assessment these days. It’s usually done by allied health professionals and where further medical input is concerned well then obviously we think that we should have that medical input and that it should be from specialists but the important thing here is to change the concentration of disability and incapacity to ability and capacity, and many people who have some disability or incapacity actually want to be in the workforce and it’s incumbent upon us to encourage them to be in the workforce rather than simply saying as we’ve done on the DSP over years, and indeed decades, that we put these people on this set and forget payment. People go onto the DSP and they’re forgotten about.
And that’s why coming back to the under 35 cohort, we’re saying not simply will we ask you to go along and have a discussion with someone about whether you can get a job but we’re expecting in the future that if you are capable of working, at least part of the time, that you will engage in some job search activities as well.
QUESTION:
Just on another matter, there’s this footage around of Joe Hockey and Mathias Cormann smoking cigars, seeing as there’s been this widespread talk about everyone should be tightening their belts, it’s a sign of extravagance I guess, what sort of message do you think that’s putting out to the public?
MINISTER:
Look we don’t live in a nanny state in Australia. People smoke, people have a drink, people are at a barbeque somewhere around Australia as I’m talking at the present time enjoying themselves. We don’t live in a nanny state.
QUESTION:
As far as that comparison though, I mean having a cigar and then sort of telling everyone else to be tight with money, don’t you think that’s a bit of a double standard?
MINISTER:
Well the message out of Tuesday night will clearly be this, that all Australians have to roll up their sleeves; all of us have to contribute to the rebuilding exercise. We are galloping towards $123 billion worth of accumulated deficits, we are on track if nothing changes to a $670 billion Commonwealth debt, and we cannot allow that to happen.
Currently every Australian has the equivalent debt of about $13,500, if we don’t do anything about it it will be out to $25,000 and that is hocking Australia’s future. The problem with the previous government is that rather than borrowing for the future, they borrowed from the future and we are determined to turn that around to ensure that the next generation of Australians will enjoy the standard of living that we all enjoy in this country.