A new start it ain’t: Jenny Macklin and unemployment

January 3, 2013 at 10:32 pm Leave a comment

The new Australian political (and election) year did not get off to an auspicious start with the Macklin affair though some good might yet come of it. The affair has seen a government minister tied up in knots about a nonsensical hypothesis, the media whipped up in frenzies of righteous wrath, and the leader of another party now wanting to live out the nonsense.
The problem occur on New Year’s Day. Families Minister Jenny Macklin held a door-stop media conference at a Melbourne hospital to promote the government’s Dad and Partner Pay scheme introduced on January 1. The scheme brings in government-funded paternity leave for two weeks so it should have been a good news story for Macklin to deliver.

However the journalists there were not interested in the good news, they were more interested in a bad news change that came in on January 1. This change was a follow on from a change John Howard made in 2006 which was to end the supporting parent allowance when the child turned eight. Howard exempted those already receiving the parenting payment before July 2006 who were able to keep it until their youngest turned 16. This meant there would be exemptions until 2014. However the Gillard Government has now ended that immediately, saving $728 million over four years.

This change shifts 80,000 single parents from the parenting payment to the Newstart allowance when their youngest child turns eight.  Some parents will be up to $110 a week worse off with the new arrangements and it was this issue that journalists turned to when one asked Macklin if she could live on the dole on $246 a week. Macklin could have done many things at this point, including refusing to answer on the grounds it was a very stupid question. Fellow Minister Tanya Plibersekwould later answer the question “properly” by saying “I don’t think anyone thinks it’s easy.”

But no such luck for Macklin, who gave the worst possible answer. “Yes I could”.  Macklin then made matters worse by omitting her answer from the transcript issued by her office. Macklin tried to push on by telling journalists they had simply applied existing rules to people who had on the payment since 2006. “What’s important for people who are unemployed is that we do everything possible to do everything we can to help people get into work and that’s what we’ll be doing with these single parents as well,” she said.

But it was too late. The damage was done by the killer quote. TV cameras captured that answer which immediately provided the headline for broadcast and print media and the subsequent non-appearance in the transcript merely fuelled speculation of a cover-up. Susie O’Brien in the Herald Sun went so far as to call it “obscene”.  Australian Council of Social Service chief executive Cassandra Goldie also took Macklin to task, but ridiculed calls for the minister to try surviving on the Newstart allowance. “You can’t replicate that experience if you are a senior member of government,” she said.

Goldie’s comment came as Greens’ leader Adam Bandt  repeated tragedy as farce by announcing he would live on the $246 allowance for one week, challenging Macklin to do the same. “Once you take into account your rent your bills, your food, there’s not much change left over from $35 a day,” he told reporters in Melbourne, but didn’t elaborate how much of his modern lifestyle and well-tailored suits would be pushed to one side to make ends meet in that week.

Bandt’s stunt had little to do with the Newstart Allowance and everything to do with his struggle to retain Melbourne at the next election. But the whole affair does highlight issues with the low benefit rate when there are systemic problems of under-employment Australia has not solved. While the current rate of unemployment is low at 5.2 per cent by historic and international standards there is a high degree of volatility within this rate. In March 2012 the unemployment rate in Tasmania was 7.0 per cent, nearly twice the 3.7 per cent rate in the Northern Territory. Similarly, in March 2012 the unemployment rate for those aged 15-19 is 18 per cent, more than three times the national average.

There are “dole cheats” but for the vast majority, the dole queue remains a humiliating experience for most people. Economist John Quiggan said that instead of completing the Howard agenda, the Gillard government ought to be looking at increasing the real value of benefits, “allowing the unemployed to share in some of the growth in incomes for the community as a whole”.  Even thinking about the absurdity of living on $246 a week, reminds us that many people have to do exactly that and some parents of those aged eight and over will now pay the price for the Government’s budget balance obsession.

Meanwhile Prime Minister Julia Gillard preferred to focus on solving the inequities of employment in the “patchwork economy” rather than increasing dole payments. “Some today see a problem, they offer blame”, Gillard told the Sydney Institute last year. “I see a person, a person who can work. I offer only opportunity, I ask only responsibility in return.”  If Gillard gets the public space to tackle that agenda, she might yet be grateful for Macklin’s mistake.

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