Speech on the Wage Subsidy Bills

08 April 2020

An address to the Australian Parliament about the JobKeeper wage subsidies.


I begin by acknowledging the work of the Treasurer, including his time away from Amy and the kids, the work of his team and his office and, of course, the work of the Commonwealth Treasury under the leadership of Steven Kennedy and Jenny Wilkinson. We acknowledge the human part of the work that we are all going through, but in many ways, especially those associated with putting together this very important package.

Our nation calls on this Parliament to do whatever is necessary to help secure the health of our people, secure their jobs and living standards and secure the future. These are not discrete tasks; they are inseparable. There is no use playing this one or that one against one another. In times this serious, we reach deep into our history, seeking solace and lessons from the past, including from wartime. Of course, this is different to war. We're talking about saving lives and saving jobs, not sinking ships, but there are useful parallels. Eighty years ago, when John Curtin was leader of the Labor Opposition, he told men and women assembled in Perth:

“Whatever has been done; whatever must be done; and all that we can hope to do in the future, are predicated by the stern realities of the war in which we are engaged.”

Not since those dark days has our country lived under a shadow like it does now. Not since those times has all that we do, all that we hope for, and all of the nations whose friendship we value and count on been so imperilled as it is today by the stern realities of a consuming global menace. Not since those days when the old chamber down the hill met with blackout blinds drawn over the windows has our Parliament and the nation it serves faced a graver threat. Now, like then, every facet of Australian life is being tested. The quality of our health system, the foundations of our economy, the strength of our democracy and the ties that bind us together are being challenged in ways that we couldn't have imagined when this Parliament met for the first time this year in February.

The most pressing health imperatives are obvious: slow the spread, bolster our health system and save lives. I welcome, as the member for McMahon and others have welcomed, the recent encouraging signs, but we don't have to look far afield to see the grim warnings against complacency. None of us imagine that we're through the very worst of it yet. If it took the suspension of our footy codes and the emptying-out of our workplaces to bring home the severity of the coronavirus as a health emergency, it was the sight of Centrelink queues that seemed to stretch all the way back to the Great Depression that alerted our nation to the diabolical economic consequences of this pandemic. Tens of thousands of Australians who'd been instructed to stay home and to keep their distance were driven by desperation into lines that wound down the street and around the block.

The immediate economic priority is triage. The wage subsidies in these bills, which are all about maintaining the link between employers and workers, are important in that regard, along with additional support deployed fast enough and in sufficient quantities to prevent business closures, to protect jobs, to support the vulnerable and to prevent a bad quarter or two becoming a lost year or two, or worse.

My colleagues and I do understand that livelihoods are on the line. That's why we've supported all three packages proposed by those opposite, the measures announced in between, the decisive action taken by the Reserve Bank and the leeway agreed by the other banks; all of it adding up to hundreds of billions of dollars in direct support or loans, to triage the economy and to try and save as many jobs as possible.

Our overwhelming priority has been to get more support to more people more urgently. An economic crisis of this scale, moving at this speed, does not allow for half measures or for stuffing around. That's why we do support the wage subsidies and the other spending contained in the bills we've debated here today.

There was never any chance that we would stand in the way of a wage subsidy that we campaigned for in the first place.

If our amendments don't pass this House, we won't be holding the bill up in the Senate. This reflects the responsible, supportive, bipartisan approach that we have taken at every single step of this crisis and its response. But bipartisanship doesn't mean parliamentary groupthink or empty acquiescence. Being constructive doesn't mean keeping quiet. And acting responsibly doesn't mean meekly following instructions. That might be the Labor Party the Government wants, but it's not the Opposition that the nation needs.

We owe the Australian people not just our industry but our judgement. We have a responsibility as the party of working people to stand up for all of the wage earners of Australia, permanent and casual. We have a duty, as the architects of the Fair Work Act to protect the rights and conditions of every worker. And as the party who ensured that the Australian economy alone in the developed world actually grew during the last global recession, we have the ability to genuinely make the proposals before the Parliament better for all Australians. Already we've demonstrated the value that a thoughtful and constructive

Opposition can deliver: by calling for these wage subsidies in the first place but also by being ahead of the game and calling for increased unemployment benefits; fixing the income test for partners; extending mutual obligation; supporting students; relief from evictions, assistance for childcare costs and services; more reliance on telehealth; support for charities; expanding access to broadband; expanding the Community Visitor Scheme; supporting the aviation sector; and more.

The core of the legislation we are considering here was first proposed in Australia by the Labor Party and by the labour movement, drawing on experience overseas. For more than a week the Government said it was impractical and unworkable, and that they wouldn't be going down this path—a week wasted on politics as usual, shooting down an idea because of where it came from and who proposed it. That kind of thinking is frustrating and corrosive at the best of times, but at times of crisis it is downright destructive. So, naturally, we welcome the Government's change of heart on wage subsidies. It is not just a victory for the labour movement; it is a victory for all of those who send us here to represent their interests.

We will vote for these bills to establish the JobKeeper payment and to legislate the other necessary spending, but in doing so I urge Government not to waste another week, another day, on reflex negativity, on Pavlovian politics-as-usual, rejecting our improvements before we even propose them here. Take this break in the ritual hostilities of this place to consider the substance of what we are offering. Find a way to factor in, respond to and listen to the genuine concerns that we raise on behalf of the people we champion: the casual employees who haven't been employed by one entity on a regular and systemic basis during the last 12 months—the casual teachers, the casual builders and others; charities that see a decline in donations but not GST turnover or tied government funding; disability businesses and the NDIS that won't be able to access the JobKeeper payment; childcare employers, who are facing a sharp decline in funding, and their workers; local government employees; temporary migrants; and partnerships with two genuinely active participants. Take on board our concerns in relation to employers being subsidised to run down existing leave entitlements.

We also need to recognise that this legislation gives the Treasurer extraordinary and broad powers to include those who aren't currently included in the scheme. That means that any worker who is excluded, in our view unfairly, from a JobKeeper payment—the council worker, or the casual teacher or the construction worker—and any otherwise-viable business or organisation that is struggling but not able to access the payment is in that position for one reason: because the Treasurer has not yet signed off on it. The only thing standing between a JobKeeper payment for more than a million Australians is the Treasurer's signature.

The intentions of these bills and many of the aspects of these bills are very welcome and very important steps worthy of our support, but they can be much better. Our efforts today will help many Australians—but perhaps not enough of them—deal with the devastating economic impacts of this diabolical health crisis, a crisis which has overthrown so many old certainties; a crisis which has redefined in weeks our understanding of the way we work, from where we work to our reliance on digital infrastructure and digital literacy. It has put up there in lights the human cost of casualisation, our reliance on sick leave and the fragility of insecure and precarious work. It has shown how important Australian manufacturing always has been, and how reckless and foolish it is to undermine our capacity to be a country which makes things. Above all, it's forced us to give real thought to what is truly essential, and, in that, I hope sincerely there are some things that this crisis changes forever.

From now on I believe every Australian will recognise how deeply fortunate we are to have such brilliant, brave and caring people running our healthcare system, just as every Australian family grappling with home-schooling now understands what an extraordinary job our teachers and educators do. I know I do. In the same way, let this crisis mark the moment where the perception of childcare in this country changes forever—not a luxury, not childminding, but an essential part of the education system and an essential service for working parents as well.

Let this crisis change forever the way our country respects, values and pays our cleaners, the people who stack shelves in the supermarket, and the truck drivers and delivery drivers bringing food and supplies—all the Australians who, whilst so many of us are sheltering at home or working from home, are keeping the wheels of the nation turning. Never again let it be said that our country can't afford to pay these Australians a decent wage or their penalty rates. And let this crisis be the moment we end the cruel fiction that anyone who needs government support is a bludger looking for a handout.

This legislation is really important. It commits, as the Treasurer rightly says, an extraordinary amount of money, and it is right, proper and appropriate that the spending of that money is scrutinised carefully by the Parliamentary Committee that we're setting up this week. It is also important to note that Standard & Poors today have put the Australian Budget and Australian Government on negative watch, which reflects some of the massive spending which is being authorised by this Parliament. We always need to be sure that we're getting bang for our buck, that it's going to the right places and that it's implemented properly and responsibly—and the committees will help us do that.

Equally important is how these necessary interventions are phased out. The PM speaks of a “snapback”. Once again, I think he's looking for a way to differentiate what he's doing now from what Labor did just over a decade ago in the GFC. We can't risk the Prime Minister's “snapback” stopping the recovery in its tracks. We cannot assume, as he seems to, that these problems in our economy will miraculously disappear in six months’ time. Yes, this support should be temporary, but it needs to be withdrawn carefully and intelligently, not driven by an arbitrary political or ideological deadline.

What we learned during the GFC is that the business of stabilisation and recovery of an economy is a very delicate undertaking. It's not only a technical policy issue but also one of confidence. The technical issue is that stimulus only supports growth as it climbs to a peak. The second you are past peak stimulus or peak dollars out the door, every dollar after that, even if it's much more than you'd normally spend, is actually detracting from growth. The stimulus must come off more slowly than the growth in new private spending, because it offsets dollar-for-dollar in terms of economic growth. If you withdraw stimulus as fast as the new money flows in, growth will be zero. If you withdraw it faster, growth will be negative, and more negative growth in the so-called recovery after a major recession would be a major mistake and a major human tragedy. This isn't the time for scorched-earth ideology and certainly not the ideology that burnt the global economy to the ground in the lead-up to the GFC yet somehow was the only thing to survive it.

In the GFC, Australia had two major waves of stimulus for precisely this reason. The first was the immediate sugar hit of the cash payments in October 2008, essential to sustain activity but not in itself sustainable. It's why we had the second wave in February 2009. That was the protein, the main nation-building investment in schools, housing and infrastructure, to underpin current and also future economic growth. It was still temporary spending, but it spread stimulus over a slightly longer period so we got through the danger period of weak private growth and were only withdrawing our stimulus once we were largely out of the woods.

Those opposite criticised the second stimulus. They voted against it. They have been criticising it for 12 years, until a couple of weeks ago. I say this in all sincerity: I genuinely hope that this was cynicism rather than stupidity. I'm hoping that they understood then and understand now what that second wave was for, even though they chose the low road of negativity and simplistic slogans to score political points, because if they genuinely still believe that second stimulus wasn't necessary, then this economy is in more trouble now. To date, the Government have shown that they've learnt the first lesson: to respond with fiscal policy including payments to households. But those opposite need to learn the second lesson as well. This economy will need protein too—the nourishment of long-term investment and demand, greater productivity and new jobs, and cheaper and cleaner energy—as we try and emerge from this crisis. It's not too early to start thinking about what that future looks like.

In our contributions today and in the speeches by the Prime Minister, the Labor leader and the Treasurer this morning, we've all acknowledged in one way or another that we're all in this together. But acknowledging that is more than a matter of saying we're all at risk from coronavirus or that we all have a responsibility to follow the rules. We are and we do. But 'we're all in this together' is also about what happens next. It's about the Australia we want to live in when life is normal again. So many Australians are working around the clock to deal with the immediate threats, and we applaud them for their selfless courage and commitment. The rest of us should be thinking about what this crisis is teaching us, what the world will look like after the virus is gone and what it all means for Australia in the years ahead. The challenges eating away at our economy before the virus will be there after the hospitals empty. Before anyone had heard of COVID-19, we saw slowing quarterly growth, well-below-average annual growth, stagnant wages and declining living standards. We can't let that be a feature of the post-pandemic economy as it was pre-pandemic.

We've known three decades of continuous economic growth, engineered by Hawke and Keating and preserved by what Australians achieved together under Rudd and Swan. But that record in itself guarantees us nothing. As we confront over a million unemployed Australians, walk past the doors of hundreds of thousands of shuttered businesses and tally towards a trillion dollars in public debt, we can't fall back on the comfort of the familiar. We can't imagine that a retreat into what has worked in the past will necessarily be near enough or good enough for the future. We need to be brave enough to recognise things can't be exactly as they were before. We need new thinking, cooperation and new solutions.

We draw inspiration for that from our history. I began today by quoting John Curtin on the stern realities of the Second World War. Of course, the country we live in and the crisis we are facing are fundamentally different today, as I said, but Curtin and Chifley had the foresight while the war was still raging to imagine Australia after the war, and they had the vision to focus on employment. Curtin spoke of victory in war, victory in peace and a country which becomes 'a mighty fellowship in which the happiness of each will be assured by the effort of all'. When he established the Department of Post-War Reconstruction, it was just before Christmas in 1942. Chifley was made the minister at the start of 1943. Most of Europe was still occupied by the Nazis, and Japanese bombs were still falling. The war may have been turning in Australia's favour, but two more years of courage and the sacrifice of many more young people would be required before victory.

Last week I gave Kim Beazley a call to talk about this period of our history. He talked about Curtin and Chifley and described them as 'men of total picture', because they knew that, if Australia were to prosper after the war, it needed to rewrite the social contract during the war, and, to be meaningful, full employment needed to be at the core of it. They understood the duty government owed to citizens whose sacrifice had kept their nation free and the responsibility Australia had to prove worthy of its people's courage.

We now need to muster again and modernise that spirit. We need to focus on jobs, wages and living standards. We need to deal with the most pressing aspects of this crisis and at the same time contemplate Australia after the virus. We need to recognise that this will be a generational challenge and that progress may take many years. We need to focus on prosperity, opportunity, sustainability, security, democracy and diplomacy, and national identity and we need to measure ourselves against those pillars of progress. We can deal with this crisis decisively, urgently and intelligently. We can reimagine the Australian economy, not just revive it. We can renew our society, not just resuscitate it. We can do more than rebuild and recover; we can create the best version of a new Australia and work towards it with the same sort of quality of planning and generosity of spirit that Chifley deployed, to such long-lasting and nation-changing effect.

Again, like the Prime Minister, the Treasurer and the Labor leader, I have no doubt that our country and our people will come through this crisis, and that, with planning and courage and forethought, we will emerge stronger for the trial—stronger, fairer and with a richer understanding of what is truly essential, with a larger sense of the true measure of our country's greatness and with a deeper faith in one another and what we can achieve together. If we want to live up to that challenge of building a better Australia, then we can begin by making these bills before the House better as well.

That's why I move the amendment circulated in my name. I move:

That all words after "That" be omitted with a view to substituting the following words:

"whilst not declining to give these bills a second reading, the House:

(1) notes that this legislation gives the Treasurer extraordinary powers to include those not currently eligible for the JobKeeper Payment; and

(2) calls on the Treasurer to use his power under this legislation to ensure more jobs are protected and that struggling, otherwise viable businesses and organisations are able to access the JobKeeper Payment".