Chapter 1Introduction
1.1On 19 October 2023, the Senate referred the provisions of the Economic Inclusion Advisory Committee Bill 2023 (the bill) to the Senate Community Affairs Legislation Committee for inquiry and report by 23 November 2023.
Note on terminology
1.2While the bill and explanatory memorandum refer to the Economic Inclusion Advisory Committee as 'the Committee,' this report will refer to it as 'the EIAC' to differentiate it from the Senate Community Affairs Legislation Committee (the committee).
Structure of the report
1.3This report contains two chapters. This chapter sets out:
the purpose of the bill;
background information on the establishment of the Interim Economic Inclusion Advisory Committee (the Interim EIAC) and its first report;
an overview of the bill’s key provisions; and
general information outlining the conduct of the inquiry and other committees’ consideration of the bill.
1.4Chapter two examines the key issues raised by submitters and concludes with the committee’s view and recommendation.
Purpose of the bill
1.5This bill would establish the Economic Inclusion Advisory Committee (the EIAC) as an independent statutory body to provide expert advice to Government on economic inclusion and tackling disadvantage in relation to policy settings, systems and structures and the adequacy, effectiveness and sustainability of the income support payments. The EIAC’s primary function would be to give a written report to the Minister for Social Services and the Treasurer (the Joint Ministers) ahead of each Commonwealth Government budget.
1.6The EIAC’s report would primarily focus on:
economic inclusion;
boosting participation;
the adequacy and sustainability of income support payments; and
reducing barriers to economic participation.
1.7The findings of the EIAC would be published on the Department of Social Services’ webpage.
1.8Additionally, the Joint Ministers may direct the EIAC 'to consider specific issues within its set remit, which will ensure that the Government can seek advice on areas of priority'.
Background
Establishment of the Interim EIAC
1.9The Joint Ministers announced the establishment of the Interim EIAC on 28November 2022. The Minister for Social Services, the Hon. Amanda Rishworth MP, said the Interim EIAC would be 'an important resource to assist in tackling systemic disadvantage and economic inclusion.'
1.10On 16 December 2022, the Joint Ministers announced the Interim EIAC’s membership. Treasurer, the Hon. Dr Jim Chalmers MP, stated that the Interim EIAC’s function would be to ‘provide advice on economic inclusion including policy settings, systems and structures, and the adequacy, effectiveness and sustainability of income support payments ahead of each Federal Budget’. The Interim EIAC also held its first meeting on 16 December 2022.
1.11The Interim EIAC’s membership is as follows:
The Hon Jenny Macklin AC (Chair);
Mr Bran Black (Business Council of Australia);
Professor Jeff Borland (The University of Melbourne);
Professor Bob Breunig (Australian National University);
Ms Emily Carter (Chief Executive Officer of Marninwarntikura Women’s Resource Centre);
Professor Kay Cook (Swinburne University of Technology);
Mr Matthew Cox (The Bryan Foundation);
Dr Cassandra Goldie AO (Australian Council of Social Service);
Dr Angela Jackson (Impact Economics and Policy);
Mr Travers McLeod (Brotherhood of St Laurence);
Ms Sally McManus (Australian Council of Trade Unions);
Associate Professor Ben Phillips (Australian National University);
Ms Leah van Poppel (Chair of Victorian NDIS Community Advisory and a member of the NDIS Independent Advisory Council); and
Professor Peter Whiteford (Australian National University).
Ex-officio members:
Mr Ray Griggs AO CSC (Secretary of the Department of Social Services); and
Dr Steven Kennedy PSM (Secretary of the Department of the Treasury).
2023–24 Report to the Australian Government
1.12The Interim EIAC’s first report was published on the Department of Social Services’ website on 21 April 2023, ahead of the 2023–24 Federal Budget. The Interim EIAC’s report was guided by its Terms of Reference, which are explored below.
Terms of reference
1.13As set out in the Terms of Reference within the report, the Interim EIAC’s purpose was to 'provide non-binding written advice on economic inclusion, including policy settings, systems and structures, and the adequacy, effectiveness and sustainability of income support payments ahead of every Budget'.
1.14The Interim EIAC’s prescribed scope for the purposes of the report was to examine:
(a)economic inclusion, including approaches to boost participation through policy settings, systems and structures, in the social security system and other government programs and policies;
(b)the adequacy, effectiveness and sustainability of income support payments including options to boost economic inclusion and tackle disadvantage;
(c)options to reduce barriers and disincentives to work, including in relation to social security and employment services;
(d)options for tailored responses to address barriers to economic inclusion for long-term unemployed and disadvantaged groups, including place-based approaches at the local level;
(e)the impact of economic inclusion policies on gender equality including consideration of work being undertaken by the Women’s Economic Equality Taskforce; and
(f)the trends of inequality markers in Australia, and any other relevant advice.
Themes and recommendations
1.15In its first annual report, the Interim EIAC made 37 recommendations across five themes:
improve the adequacy of income support and rent assistance;
support more Australians to participate in the economy through commitment to a broader full employment objective;
address disadvantage in the places it is concentrated;
remove barriers to economic inclusion for families with children; and
propose legislated measures on economic inclusion and poverty reduction.
1.16In making these recommendations, the Interim EIAC explained that it focussed on the needs of people on JobSeeker, Youth Allowance, and related working age payments because they are 'the largest number of Australians experiencing poverty and disadvantage today'.
Key provisions of the bill
1.17This bill is comprised of three parts: preliminary matters (clauses 1 to 5), the Economic Inclusion Advisory Committee (clauses 6 to 24), and other matters (clauses 25 to 29).
1.18Clauses 1 to 4 provide the bill’s short title, details concerning the commencement of the bill, a simplified outline of the bill and its associated definitions.
1.19Clause 5 of the bill provides that any function or power given to the Joint Ministers through the bill will be performed or exercised by both Ministers jointly.
1.20The EIAC is established by clause 7, and subclause 8(1) prescribes that the EIAC’s function will be to give a written report to the Joint Ministers ahead of each Commonwealth Government budget.
1.21Subclauses 8(2) to 8(4) stipulate the contents of the EIAC’s report. The report must contain advice by the EIAC about one or more of the following matters as they relate to the policies, programs and responsibilities of the government:
economic inclusion, including approaches to boost economic participation through policy settings, systems and structures in the social security system and other relevant programs and policies;
the adequacy, effectiveness and sustainability of income support payments, including options to boost economic inclusion and tackle disadvantage;
options to reduce barriers and disincentives to work, including in relation to social security and employment services;
options for tailored responses to address barriers to economic inclusion for long term unemployed and disadvantaged groups, including place‑based approaches at the local level, having regard to the split between Commonwealth, State, Territory and local government responsibilities;
the impact of economic inclusion policies on people with barriers to work, including (without limitation) people with caring responsibilities, Indigenous Australians and people with disability;
the impact of economic inclusion policies on gender equality; and
the trends of inequality markers in Australia and international comparisons.
1.22In preparing its report, the EIAC must have regard to, and illustrate that it considered:
the Commonwealth Government’s economic and fiscal outlook and fiscal strategy;
workforce participation;
relevant Commonwealth Government policies; and
the long-term sustainability of Australia’s social security system.
1.23Subclause 8(5) stipulates that the EIAC must give the report to the Joint Ministers with adequate time for their consideration before the Federal Budget is delivered.
1.24Directions to the EIAC by the Joint Ministers are provided by subclauses 8(6) to 8(8), which stipulates that the Ministers may, by written notice to the EIAC’s Chair, direct the EIAC to:
ensure that its report addresses the specified matters, so long as they fall within the parameters of subclause 8(2); and
ensure that its report only addresses the specific matters under subclause 8(2), and no other matters.
1.25The EIAC’s powers are provided by clause 9, which stipulates that it has the power to do all things necessary or convenient for, or in connection with, the performance of its function.
1.26Clauses 10 to 14 of the bill set out the composition of the EIAC and its membership. The bill stipulates that the EIAC will:
have a chair;
have 13 members (comprised of economists, expert academics, union and business representatives, as well as community advocates);
have at least one Indigenous member that also falls into one of the above categories;
have regard to the desirability of membership reflecting the diversity of the general community;
hold office on a part-time basis for three years;
be appointed by the Minister for Social Services in consultation with the Treasurer by written instrument;
be eligible for reappointment at the end of their term; and
not be remunerated.
1.27Clause 15 addresses the Chair’s or a member’s leave of absence.
1.28Clause 16 stipulates that a member of the committee must declare any conflicts of interest to the Joint Ministers, and clause 17 stipulates that conflicts of interest must also be declared to the EIAC itself.
1.29Matters related to member resignation and termination are covered by clauses 18 and 19. Clause 18 details the process for a member to resign, and clause 19 provides that the Minister for Social Services, after consulting with the Treasurer, may terminate the appointment of a member at any time. The explanatory memorandum provides examples of circumstances where the Minister may terminate a member, including:
misbehaviour;
a member is unable to perform their duties due to physical or mental incapacity;
the member is bankrupt;
the member is absent for multiple consecutive meetings, except for when on a granted leave of absence;
a member fails to disclose their interests as per clauses 16 and 17; or
the member no longer meets the requirements of their appointment.
1.30Clauses 21 to 24 detail the EIAC’s operation. The bill provides that the EIAC itself will determine how frequently to meet. These clauses also prescribe rules regarding quorum, the conduct of meetings, and that the Departmental Secretary and Treasury Secretary are to attend the meetings.
1.31Clauses 25 to 29 relate to other matters, including staffing, instances where the Minister must consult the Treasurer, that there must be a periodic review of the operation of the Act if passed, and that the Governor General may make regulations prescribing matters required or permitted by the bill, or necessary or convenient to give effect to the bill.
1.32If passed by the Parliament, the provisions would commence the day after the Act receives Royal Assent.
Compatibility with human rights
1.33The statement of compatibility with human rights contained in the bill’s explanatory memorandum notes that the bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
1.34The statement also provides that the bill engages the following human rights:
the right to social security;
the rights of equality and non-discrimination;
the right to self-determination;
the rights of people with disability;
the rights of parents and children;
the right to work and rights at work; and
the right to an adequate standard of living, including food, water and housing.
1.35The statement concludes that the bill is compatible with human rights because it promotes the protection of human rights for some of the most vulnerable groups in society.
Consideration by other committees
1.36The Parliamentary Joint Committee on Human Rights made no comment on the bill in its Report 12 of 2023.
1.37The Senate Standing Committee for the Scrutiny of Bills made no comment on the bill.
Financial impact statement
1.38The bill’s explanatory memorandum states that the government will provide $8.7 million over four years from 2023–24 (and $2.2 million per year ongoing) to provide the EIAC with secretariat and research support.
1.39The Department of Social Services’ submission also notes that of the $8.7 million in funding provided over the forward estimates in the 2023–24 Budget, $3.2 million was allocated for the EIAC to commission its own research and undertake consultation.
Conduct of the inquiry
1.40Details of the inquiry were made available on the committee’s website. The committee contacted organisations and individuals to invite them to make a submission to the inquiry by 3 November 2023. The committee received 16 submissions, which are listed at Appendix 1.
1.41The committee held two public hearings in Canberra on 10 and 13of November 2023. Witnesses are listed at Appendix 2.
1.42The committee thanks the organisations and individuals that made submissions and appeared at public hearings for their contributions to the inquiry.
Note on references
1.43References to Committee Hansard in this report are to proof transcripts. Pagenumbers may vary between proof and official transcripts.