More support needed to address youth unemployment

rock_solid.jpgMr STEPHEN JONES (Throsby) (20:02): I am pleased to be participating in the debate on the Social Security Legislation Amendment (Increased Employment Participation) Bill 2014, particularly as it focuses on how we can create opportunities for young people to get off benefits and find their way into jobs. We all know that the most important thing we can do to ensure that a young person does not suffer a life of long periods of unemployment is to ensure that they finish school, because there is a very stubborn correlation between the completion of high school and long-term unemployment. So the first thing we need to do to ensure that young people find their way into work is to ensure that they get a decent education, and that is why investing in our school system is so important.

The second thing you can do is to ensure that we are working with, and not against, the economic cycle to ensure that the government withdraws when the economy is growing and that we provide the right sorts of stimulus to the economy when it is slowing down, to keep businesses alive, to keeps jobs growing and to ensure that young people leaving school have the opportunity that we did when we left school—to find a job.

The bill before the House creates some incentives to get a job and to keep a job through two measures. The bill introduces the job commitment bonus, which is a tax-free payment of $2,500 for young Australians aged between 18 and 30 who have been receiving either Newstart or the youth allowance for a period of 12 months. They get it if they remain in gainful employment for a further 12-month period. It also allows young Australians to qualify for a further tax-free payment of $4,000 if they remain in gainful employment for another 12 months—that is, a maximum of 24 months in total. So, over two years you have the capacity to receive an incentive payment of $6,500. I know when I was a young person $6,500 probably would have helped me pay off the bills I had accrued before I had got myself into work or would have helped me buy a car to get to and from work or to meet the other expenses of being in employment. So that part of the package is welcomed by those of us on this side of the House.

The second part of the package is about labour force mobility—about encouraging people to move from the place where potential workers are to the place where the jobs are—and that is the relocation assistance to take up a job. It provides financial assistance of $3,000 or $6,000 for long-term unemployed people—that is, job seekers on Newstart, youth allowance or parenting payments who have been there for at least 12 months. The $3,000 payment is for people moving from a regional area to a metropolitan area; the $6,000 is for people moving from a metropolitan area to a regional area. We might cavil about the wisdom of that in some areas. For example, the area we are standing in at the moment is probably defined as a metropolitan area under the legislation; it is an area of very low unemployment by national standards. If somebody were to move here from a nearby regional area with higher unemployment—such as Yass or Goulburn—they probably would not attract the higher payment, although the rent and other costs of living in Canberra are higher. But in the scheme of things, these are small criticisms that should not take away from the overall support that we on this side of the House give to the legislation.

I come from the Illawarra area, where we have the second-highest youth unemployment rate in the state. The member for Parramatta, who is here at the bench with me today, represents an area that also has very high youth unemployment. And we know that we need to do better as a country, and we are two local members committed to ensuring that we create opportunities for our young people so we do not win the gold and silver medals when it comes to high youth unemployment.

I support the bill, and I am sure the member for Parramatta supports the bill, because it is an extension of what Labor was doing when we were in government. In government Labor focused on supporting young people to finish school, to get the training and higher education they needed, as well as the well-paying jobs of the future. As I said at the outset, the best thing we can do to ensure that is invest in our school education system, and our tertiary education system—particularly our TAFE system.

That is why we reformed and rebuilt skills in the training sector, so it was responsive to the skills shortages that exist nationally and regionally. Last year our Move to Work program provided practical and financial assistance for job seekers who were willing to move outside their local area to take up ongoing employment or an apprenticeship. Overall we invested over $2.4 billion, and put industry at the centre of the National Training System. We delivered the skilled workers that employers need, and made sure that the training actually led to jobs at the other end. I will have something to say about that in a moment, when I focus on a number of very successful programs in my own electorate that are at threat of not receiving ongoing funding.

In 2012 there were about 1.9 million students in the public system, up from 1.67 million in 2007—a 13.8 per cent increase in the number of VET students entering training—and that is a good outcome. Some 1.54 million of these VET places were Commonwealth funded, an increase of almost 25 per cent from the 1.24 million in 2007. All of this paints a picture of how, when we were in government, we were committed to training. While this legislation does not go to training, and while it does not go towards supporting people to make them more employable, it is a part of the picture because it is creating incentives.

Our $57.5 million Apprentice Kickstart initiative supported 21,000 building, construction and engineering apprentices by tripling the incentives for the employers in the first year of taking on an apprentice—and made sure skills in the sector were continuing to develop during what was a weaker time in the construction industry. I mention this because it is important that while we are creating incentives for young people to move to a place where they might find work, or to move into an area where they get can and keep a job, it is also important that we work on the incentives for employers to take on an apprentice or trainee and offer them work.

In government Labor increased financial support for families by $4,000, to encourage teenagers to stay in school or TAFE, and we did this through a range of mechanisms. Our initiatives left the incoming coalition government with one of the lowest unemployment rates among major, advanced economies, at 5.7 per cent. That is still too high, and I know the member for Parramatta shares this view, for the reasons I set out earlier, but it is a rate that would be the envy of many countries around the world.

Job creation was a part of the DNA of the Labor government, I do not believe it is a part of the DNA of the current government. Current labour force figures from the Australian Bureau of Statistics have confirmed that unemployment remained worryingly high at six per cent in February. Before the election the Prime Minister promised he would create one million jobs in five years—that is around 200,000 jobs a year, and we have not had a very good start. After six months as Prime Minister Mr Abbott should have created around 100,000 jobs to be on target, but the reality is very different. He has created 33,700 jobs, so he is already more than 65,000 jobs behind, with no sign of closing the gap.

In my electorate of Throsby we have one of the highest levels of youth unemployment in New South Wales—at 16.5 percent youth unemployment in the Illawarra is well over the state average of 11.8 per cent, and the national average, which is currently at around 12.5 per cent. These people look to government, look to business and look to community leaders to put in place the programs and policies that will help them find their way into a job—and if they have a job, to ensure that it is a good and secure job, so that they can provide for themselves and their families and their future.

It is not the first time we have had a tough unemployment outlook in our region. However, in the past we saw a Labor government willing to put in place the right series of programs to ensure we had the region's back. Under Labor, vocational education and training systems were much better resourced, and clearly more heavily funded than we are looking at today. While this bill goes some way to addressing the problem of youth unemployment, mere financial incentives are not enough.

I want to talk about the Better Futures program. The government needs to commit to continuing the funding for this program. Ten communities around Australia were identified as communities that had unacceptably high levels of youth unemployment, and unacceptably high levels of another generation of young people who are potentially entering a situation of long-term unemployment. This program seeks to close the gap in social disadvantage for people facing significant barriers to work, and the risk of long-term unemployment, because it is not only a waste of life but it is also a heavy financial burden on the community.

Better Futures works to turn this around by identifying groups of people in 10 local government areas around Australia, and it then engages with the local community to tailor employment programs to deal with specific local circumstances and demand. One of the 10 areas identified was Shellharbour, in my electorate. In fact, I share this Shellharbour with the new member for Gilmore, and I hope that she also will be a supporter of this important program, because this should be beyond party politics. It goes together with the excellent work that has been done by our local employment coordinators, using the resources of their Flexible Funding Pool—another program that could face the chop in just a few weeks time, upon the release of the report of the commission of horrors, the National Commission of Audit.

The intensive and innovative Young at Heart program takes a group of disadvantaged young people, and provides them with training that they need for a Certificate III in Aged Care—plus hours of local work they experience in the aged care sector. We have a similar program run by the community sector, providing retail traineeships for young people. Many of these people have been out work for years and years, and this is the first job they have had in a long time. Not only is it providing them with income but it is providing them with the social connections and the personal relationships that are necessary for them to have a fulfilling life. I am pleased to say that all of the participants that have been engaged in these programs have been guaranteed work in this sector, and have taken up gainful employment in the Illawarra.

My favourite story comes from Michelle, whom I met at the official graduation of the Young at Heart program with her husband and two kids. Michelle had been out of the workforce for nine years, but thanks to Young at Heart Michelle had found her way back into the workforce and into a job that she loves. Another great story came from Candice from Mount Warrigal in my electorate. She decided to enter the program so that she could be a positive role model for her kids and show them how important it is to give back to the community. Candice is now taking a further step and is studying to become a registered nurse. Neither of these stories would have been possible without the intervention—the intensive intervention—of the Better Futures and the Flexible Funding Pool programs of the former government. These two women are just two of about 40 young people in the Illawarra who have so far completed the Young at Heart program and are looking after our older Australians in needy locations throughout the region. This is just one of more than 20 programs run by Better Futures in the Illawarra region, actively combating rising levels of unemployment.

There are two more programs that I could talk about. This is the part of the equation that needs to be considered because incentives to work through the legislation that is being debated before the House today are important—and that is what it enjoys our support. But unless you deal with these other things, we are at risk of leaving another generation behind. I have in mind a program that was funded under the previous government through Better Futures, but the contract was not honoured under the new government. Illawarra Area Child Care, for its Future Education and Care project, was going to be providing flexible childcare arrangements for young mums trying to get into the workforce—single mums in shiftwork. As you and I would know, Mr Deputy Speaker Vasta, in shiftwork there is not a lot of child care available for you. We were plugging that gap through the specialised program. Another program being run by WEA Illawarra was providing networking arrangements. It is not what you know but who you know, we are often told. The WEA were ensuring that these people connected with whom you need to know to get a job.

I support the legislation; it is good legislation. But if we overlook and fail to fund these other important programs, like Better Futures and the Flexible Funding Pool that is available through our LEPs, we will not address that scourge of long-term unemployment for our young people. We can do better as a country.