Release type: Speech


The Major Church Providers Summit

It is a great pleasure to be here today at the Major Church Providers Summit to discuss with you an issue of critical importance to both the Australian Government and the social services sector— that is how will the social and economic effects of the current global financial crisis impact on those in need and those at risk in our community?

The Issues Paper prepared by Access Economics and commissioned by the Major Church providers provides a timely overview of the potential impact, and the ability of the Government and the social services sector to respond.

Over the past decade, the Australian economy has experienced a period of unprecedented growth leading to record unemployment.

As the Issues Paper highlights however, this is not the complete picture.

Despite overall growth we have also seen increasing inequalities across a number of areas. This has come about for of a number of reasons including:

  • An employment services system that was failing the most disadvantaged jobseekers;
  • A lack of investment in skills and training and a failure to ensure that Australian workers were equipped with the skills needed to meet the demands of the current labour market;
  • Groups within our community – usually those living in areas of disadvantage –who missed out on the economic benefits of growth; and
  • Increasing numbers of people, who traditionally haven’t relied on social services, needing support because of rising costs and financial stress.

The social and economic fallout from the current global financial crisis will — without an appropriate and effective response — only exacerbate these problems, and further marginalise those in greatest need.

In addition, the potential impact on the level of unemployment and shifts in the types of jobs available to less skilled workers may result in increasing numbers of Australians in need.

And Australian Government knows now more than ever that its important to put in place the right policy settings that will ensure Australia’s continued growth beyond today’s financial crisis.

Long before the onset of the Global Financial Crisis, the Government set about fundamentally reforming employment services.

I don’t think I have to go to far in this room to get agreement that reform was needed with the current Job Network, confusing, inflexible, laden with red tape and not aligned with training or the needs of employers.

Yet despite the financial downturn employment services remain central to meeting our future economic challenges.

The new services that will begin on July 1 next year have been crafted following extensive – and sometimes exhausting – consultations.

As well as providing more resources for the most disadvantaged job seekers, the new services focuses on skills acquisition and training, and it tailors support to the needs of individuals.

The new services will also :

  • replace the current range of often confusing and complex programs with one integrated service;
  • focus more on skills and training, including offering a 20 per cent bonus to those providers who obtain an employment outcome after successfully completing an appropriate accredited training course relevant to the needs of the local labour market; and
  • include a $6 million Employer Broker fund, specifically to address areas of skill or labour shortage.

Crucially, the new employment services will deliver coordinated and individualised support to jobseekers ranging from the ‘work-ready’ job seeker through to the long-term unemployed including those who face personal and vocational barriers to getting a job.

And to support jobseekers who live in areas of multiple and concentrated disadvantage, the new employment services will also include a $41 million Innovation Fund.

Many of these job seekers have missed out on the economic growth we’ve experienced in this country over the last decade.

So in all, we believe the fundamentals of the new system are right and will strongly position Australia to meet changing global demands — now, and in the future.

The Issues Paper refers to the strong likelihood of a significant increase in the demand for employment services as a result of the global financial crisis, and highlights the difficulties the social services sector will face in responding to this increased demand.

We will reduce the cost and burden of cumbersome administration and red tape which has constrained the sector in the past.

The new employment services will streamline programs and processes and increase the capacity of the sector to focus on its core business: responding holistically to the changing and varied needs of your clients.

While we undertake these long-term fundamental reforms to the way we support jobseekers to secure and retain jobs, the Australian Government is at the same time responding swiftly to the unprecedented challenges of the global financial crisis.

We have committed to delivering a comprehensive and decisive $10.4 billion Economic Security Strategy. This includes targeted funding to assist pensioners, middle and low-income families and first home buyers in weathering the economic turmoil.

A key part of this package is a new investment of $187 million to create an additional 56 000 training places during this financial year.

This represents a significant injection of new funding and it is a crucial element in the strategic approach we’re taking during these difficult times.

This new investment takes the Government’s commitment for extra training places to $2 billion and 701,000 new places over five years.

While I have outlined some of the Government’s key initiatives designed to assist Australians through the social and economic challenges we all face, we also recognise that a strong and effective partnership between the Government and the social services sector is critical.

As the Issues Paper notes, effectively tackling the social and economic impacts of the global financial crisis requires a collaborative and coordinated response to current and upcoming challenges.

The extensive consultation with as part of the reform to employment services could be viewed as a down payment on the Government’s future investment in a partnership with the social sector

This collaborative approach with all sectors in the community is also central to the Government’s broad reform agenda.

Through mechanisms like Council of Australian Governments the Rudd Government is committed to working closely with state and territory governments.

And last week representatives from local governments across the nation converged on Canberra to discuss how we can all work better together to meet the needs of local communities.

Importantly, we are also pursuing a new relationship between the Government and the not-for-profit sector.

We recognise that, as members of the sector, organisations delivering social services to those in need have been unnecessarily constrained in their work.

That is why the Government is working to reform and strengthen the legal, regulatory and financial framework foundations of the sector.

Our approach to developing this partnership includes:

  • The development of a National Compact which will provide a formal mechanism for discussion and the development of collaborative and coordinated responses to important issues. Senator Stephens Parliamentary Secretary for Social Inclusion who is here today has been leading this work and has attended several of the consultation sessions across the country;
  • The Review of the Taxation System (the Henry Review) will report to Government due at the end of 2009;
  • The Senate Economics Committee Inquiry into disclosure regimes and regulation of the not-for-profit sector;
  • Work underway to develop better ways of measuring the social and economic impact of the not-for-profit sector in Australia; and
  • Restoring the ability of the sector to advocate on behalf of clients by removing gagging clauses from all Government contracts.

I thank you for the opportunity to talk about the issues raised in the Issues Paper released here today.

I commend Catholic Social Services Australia, Anglicare Australia, The Salvation Army and UnitingCare Australia on commissioning the paper and highlighting their concerns about the impact of the social and economic challenges we face.

The global financial crisis will present unprecedented challenges for us all.

By working in partnership to tackle the coming challenges, we will be better placed to respond to these challenges innovatively and effectively.

Thank you.