It is a great pleasure to be here with you all today with some old friends sitting down here from the ACL, I have known for many years. I am very pleased to be here with all of you.
Can I first of all though acknowledge the Gadigal people of the Eora Nation and acknowledge any elders past and present in this wonderful city of Sydney, my home city and its always wonderful to be here.
Can I also thank the many thousands, and indeed millions, of people over the course of my political life who I know pray earnestly for our political leaders. Both sides of the fence, all politicians, no matter what Sunday morning it is or what Sunday evening you will walk into a church somewhere in this country and there are faithful people, faithfully praying for their country, faithfully praying for their leaders, for their communities. I'm a big believer in prayer. I have seen the impact of it in my own life. I know it works and you know it works. And I'd encourage you all to continue, right across the country, to be faithful in your prayers for our country and for its future.
I thank you John and Lyle and the whole team at the ACL for the introduction and the invitation to join so many others who've gone before me, from both sides of politics, to address your national conference over the years.
As part of the lead-up to this year's Budget, I think it's important today that I take the opportunity this morning to reflect on the importance of families in our economy and in our society more generally. To paraphrase Ronald Reagan, Governments may have the power to destroy the family, but they will never have the power to replace it. Families and the relationships that underpin them are irreplaceable, in the social and economic fabric of our society. When functional and effective, families nourish, they nurture and they protect. They enable us to become fulfilled, functional human beings, capable of contribution and self-sufficiency. This is especially true for the development of children.
When I was Minister for Social Services, I appointed Professor Anne Holland as the Director of the Australian Institute of Family Studies. And recently, Anne wrote a piece where she said the following: "Families are where the most important prevention and early intervention occurs. And that while quality early childhood education," of which I'm a keen supporter, "is important in boosting the developmental outcomes of kids growing up with disadvantage, early childhood education alone is insufficient. The home environment matters even more." She said, "The primary place where social and emotional skills are formed is in the home. And disrupted family relationships can diminish our capacity for resilience and compromise the development of children contributing to poorer outcomes in later life."
Families can and must provide the necessary foundation for life. To achieve this, they must be firmly grounded in deep, committed and selfless relationships. Strong and functional families are also necessary for order in our society and the stability required for a productive and prosperous economy. When families fall apart and become dysfunctional, all of this is put at risk. The damage done to society is inestimable. As is the damage to every individual involved, especially children; economically, psychologically, physically, and socially.
To protect our country, to protect our society, to protect our economy and to protect our children – we must protect the family. As the most sacred national institution and all that goes towards making our families strong. Our role as a government, especially as we frame this Budget, is to provide a much better environment in which our families can flourish. One of the key pressures families face is financial stress. While financial pressures may not be the principal determining factor why a marriage fails, or a family falls apart, it is all too often the pressure that exposes and further exacerbates the fault lines in relationships, and triggers broader problems; ranging from just poor communication through to mental illness and, in its worst state, sexual abuse and violence.
As a result, getting families into work and staying in work should be as important to those of us who have strong views about the importance of marriage and the family as other considerations that tend to get more attention in the public debate. Central to this is the ability of parents to be in jobs and for children to be given the opportunities to get into jobs and succeed.
To achieve this, our Government, in which I have the privilege to serve as Treasurer, believes economic growth and jobs must be our priority. As all families have their own histories and stories, their own complexities, not everyone falls neatly into averages and medians. Not every life follows the path of the statistics laid down and yet it is possible to step back and see the broad trends and to map out the way family's structure and support themselves against the bigger structures in the economy and our society at large.
Over the past half century, the structure and character of families in Australia, as is elsewhere in the West, has change dramatically. For example, in 1961, the divorce rate was around 2.8 per 1,000 married couples. By 1976, following the Family Law Act of 1975 that brought in no-fault divorce, it had risen to 4.6 per 1,000. Today, there are around 50,000 divorces per year in Australia, with almost half of these divorces involving children. Researchers found that divorce has a long-lasting negative impact on wellbeing. For both men and women, divorce has a detrimental effect on life satisfaction, social connectedness and happiness. For women especially, divorce has negative impacts on general health, on vitality and mental health as well as on financial wellbeing.
The Australian Institute of Family Studies report contends there are also economic consequences of divorce to a society as a whole. The health consequences of divorce for women are likely to increase demand for health services that are paid for in part or full by government. Add to this that single divorcees, according to research, rely more on the public pension than those who stay married or remarry and you can see the economic consequences of divorce can last for two or more decades.
In recent years, the divorce rate has actually declined but then, so, too, has the rate of marriage. Since the early 1970s, there has been a steady decline in the rate of marriage. In June of 2012, in the latest year we have these statistics for, around 15 per cent of Australian families were single-parent families. That's over 960,000 families and in over 80 per cent of those families, the single parent is a mother.
Now, while I certainly believe – and I'm sure you'd agree – single parents in this country can often be the best parent a child could ever hope to have. Their sacrifices are extraordinary. Their love knows no bounds for their children, as you would hope would be the case for all parents but they are in a special category in terms of the demands placed on them. But we also know that the data also demonstrates that single-parents families are generally at higher risk of disadvantage in a range of areas; income, housing, social participation and employment.
Now, the Government already does much for families to support families. In the last Budget more than a third of total government spending was on social security and welfare. Of that $154 billion, around $38 billion of that went to families with children. As well as welfare payments and benefits, we support a range of community programs to help families. Under the Families and Communities programs, we're investing almost $2.5 billion through over 1,600 grants to more than 800 families and community service organisations. This is about strengthening relationships, supporting families, improving children's wellbeing and increasing participation in community life. All of this works towards stronger, more cohesive families and communities and to reducing the cost of family breakdown.
Now, all of this support is important, but I believe one of the surest ways we can help families is by improving the prospects for parents, single or otherwise, to have a job. The best form of welfare is a job. Having a job underpins so many of the other aspects of social and economic wellbeing. There is nothing more personal. There is nothing more sacred than the choices you can make as a parent about your own family and how you seek to raise your own children, how you seek to educate your children, how you seek to bring them up in the society, the values you wish to teach them and instil in them so they can be full, happy and positive individuals who can make a contribution and realise all their great potential. We don't want the Government on our side of politics to be involved and in the middle, trying to direct families with these personal choices that they have to make. A family, though, that is dependent on welfare has fewer choices. A family that has control of its own economic future, through working, has choices.
Australia's overall unemployment rate fell to 5.7 per cent in March this year, which is the lowest level since 2013. This was good news for the economy, and for the 26,000 people who started new jobs that month. Over 440,000 people have got jobs since the last election. In the last 18 months, more than 50,000 young people have got jobs. I commend the young people who turned up at the application and sought the job for these figures. I commend the business that created the job and made the investment and offered them that job and took a punt on that young person or that single parent or that 53-year-old worker who was changing jobs and going into another job. They are the heroes of our job numbers. But we know that there is more to do to support employment, to support the economy to create more jobs and to support people looking for jobs and to land them.
More than a quarter of those single-parent families in 2012 were jobless families. Of those jobless families, 223,000 were jobless single-parent families with dependents; 89 per cent were single-mother families and 72 per cent of jobless single mothers had children under 10.
Joblessness is not confined to single-parent families. In 2012, 1.3 million Australian families were jobless. That's almost one in five families. I had no starker figure presented to me when I was Social Services Minister than that. In 2012, 12 per cent of Australian children were growing up in jobless families. And almost 40 per cent of children who grow up in a jobless family on welfare, the research tells us, will be welfare-dependent by the time they're 22.
We must do better than this. We really must do better than this.
We know that over time, unemployment can have a very significant impact on people's lives, even a short period of unemployment – let alone the long term. It can erode skills and it can erode confidence, which limits people's ability to re-enter the workforce. Such a scenario poses serious concerns for national productivity and individual wellbeing. The situation has even more significant impacts for young people.
As the Brotherhood of St Laurence observed in one of their reports last year, they presented to me an extended period out the of workforce for a young person in this most formative period of their lives places them at risk of a life sentence of poverty and exclusion from the mainstream of our society.
You can't write off a generation to unemployment and welfare. Their human dignity deserves better than that.
Unemployment will also reduce people's ability to save for their retirement as well as the detrimental impacts on mental and physical health and social connections and, as I said before, in extreme cases, but sadly not uncommon, it also leads to domestic violence and sexual abuse. The direct and indirect costs of violence against women and their children alone are estimated to be $21.7 billion per year. Victims bear a significant proportion of the cost of the violence. Governments, both state and Commonwealth, bear about a third or approximately $7.8 billion in order to deliver health services, criminal justice and social welfare for victims and their children.
The immediate community in which victims live, the children they care for and the employers they work for also suffer in the flow-on costs of violence against women. The impacts of joblessness, will have further flow-on effects on the families of unemployed people in the wider community, further impacting on the economy as well.
For children growing up in jobless families, there are all kinds of impacts on their childhood experiences as well as their own prospects in life. We believe in having a strong safety net for people going through these tough times, but we also believe the best form of welfare is a job.
A job provides that dignity, as I said before, and it helps break the cycle of poverty. We want all Australians to be able to realise their potential – particularly in the workforce. Encouraging more people, young people, into work is especially important as it helps them avoid that long-term welfare dependency. It promotes cohesion and supports growth, particularly as the population ages, as the baby boomers continue to retire they need to be replaced by younger workers in our economy.
We know that, for some young people, securing a foothold in the job market can be tough. I was down in Wodonga yesterday visiting a program called Too Cool For School where they're getting young people into work. Nothing better than the look of a young person who believed they could never get a job getting a job. The only smile that's bigger than theirs is the person who mentored them and helped them do it. I commend all of those who I know work in faith-based organises around the country, and those who work in non-faith-based organisations. The work that you do in getting young people into work, I can't think of a more noble task.
For some employers, it can be hard to make a call whether to take a young person on, given that they won't often have much experience or referees to vouch for them. Getting more young people into work is a priority for our Government and will be a priority in this Budget. We want all young Australians to have the skills and opportunities to be more competitive in the labour market and we want to encourage more employers to give young people a go.
Australians know that it will be no easy task to secure the growth and jobs in the highly competitive, volatile and uncertain global economy we are now faced with, but they also know that we can provide the jobs that families and young people need and to do that we must make economic growth and jobs our priority in this Budget.
Australians know that our economic fundamentals depend on how well we continue to shape our economy. As we transition from the unprecedented investment boom in our mining sector and we maintain the gains that are there and expand into a more diversified, stronger economy. And they are clearly said that we must have an economic plan to make this transition a success. This year's Budget is that economic plan for securing that transition from the mining investment phase boom through to the more diversified, stronger, new economy. Despite the challenge that we all face in this economy, it is heartening to know that we are making it happen together. A 3 per cent growth last year, our economy is still growing faster than the world's most advanced economies, faster than the United States, the United Kingdom, Japan, Germany. We're growing twice as fast as Canada, faster than New Zealand and Singapore and matching it with economies like South Korea.
I mentioned the employment figures, over 440,000 jobs created, unemployment falling to 5.7 per cent and more than 50,000 new jobs created for young people in the last 18 months alone.
Youth unemployment today is lower than it was at the last election. Of all the things that I believe our Government can say over the last 2.5 years of the many achievements, even those that I have been involved in in former portfolios in immigration and border protection, I count the fact that youth unemployment is lower than it was at the last election our most outstanding.
We cannot afford to stand still and be complacent. This year's Budget sets out our plan to ensure the economy is working for every Australians and driving action in three key areas.
Firstly, sticking to our national economic plan for jobs and growth, backing investment, innovation, infrastructure an incentive in our economy to support the investment that will drive jobs and growth.
Second, creating a fairer and more sustainable tax system that will cover the federal government's responsibilities for the next generation. This means a superannuation system that is fairer and fit for purpose to ensure fewer Australians are reliant on a part or full time pension. A system that is flexible and recognises the demands and vagaries of modern life and modern work patterns.
A tax system with integrity that ensures tax is paid especially by multinationals. Last year we passed legislation to give the tax office the power to tax multinationals on the income they earn here in Australia. Astonishingly, the Labor Party voted against this legislation.
In addition since becoming Treasurer I have made it a condition of foreign investment approval that all such investors whether it be in property or businesses or other things must sign a tax deed binding them to pay tax on their earnings and not engaging things like profit shifting offshore. Those found to have fallen foul of that will not only face the penalties under the Tax Act but they will be forced to divest their assets as a result of their breach and there have already been quite a number of those deeds signed.
Rather than talking about cracking down on multinational tax avoidance we are delivering on it. Our opponents in this election only, Labor's only act on multinational tax avoidance in this Parliament has been to vote against it which is consistent with their record when they were in Government.
The tax system also, we need one that doesn't penalise families for investing in their future with a housing tax as proposed by Labor with their changes to negative gearing and capital gains tax.
You will forgive me for being a little political this morning, you may have picked that up, there is an election coming and it is an important choice and whatever room we are standing in we need to understand what these choices are.
We are talking about families today and I don't believe a housing tax that penalises families who are just trying to get ahead is a good plan for families.
Aggregate net rental losses, that is what you claim when you are negative gearing, claimed by those who earn between $37,000 and $80,000 net taxable income – so, in that middle income tax bracket - in 2013/14 were more than twice the losses claimed by those earning over 180,000.
Some $3.6 million claimed on net rental losses by those on middle incomes versus $1.5 million those on high incomes. Around three quarters of those with net rental losses own just one property – they're not property barons. And the predominant occupations for those with rental losses are nurses, teachers, police and emergency services workers but above all they are mums and dads. They are mum and dad investors.
If you support families then you do not hit mum and dad investors on average wages who are just trying to provide a future for their family, with a housing tax that will force up rents and undermine the value of the family home. Labor's housing tax rips the rug away from families who are just trying to get ahead.
Finally, we need to ensure that the government lives within its means to balance the Budget and to reduce the burden of long term debt. Australians live within their means, businesses live within their means – so must governments.
We will invest though in services and supports that assist Australian families but we will do it in a way that we can afford. A lot is said about fairness in Budgets and fairness is always applied as it should to those who are in need of support and whether it is fair to them and that is a worthy consideration. One that is always at the top of my mind, and I believe all Treasurer's whatever Party they come from. It also must be fair to those who pay for it – the taxpayers of Australia who aren't necessarily the recipients of that nor in the vast majority of cases should they be.
Fairness is a two way street. It has got to be fair for those who need the services and it has got to be fair for those who have to pay for the services and go out and run businesses and work every day and pay taxes to ensure those services can be met. They don't deserve higher taxes, they don't deserve higher deficits and they don't deserve higher debt in the name of fairness. What they deserve is a fair go – both ways.
Today, the Minister for Health announced a Budget measure to create a stand alone national child and adult public dental scheme to provide over 10 million Australians with access to public dental through one single national agreement with the states and territories. This necessary and targeted spending, as always, will be funded by savings we make by better targeting other programs not by putting up taxes.
A third of the 800,000 or so children who don't regularly go to the dentist every year come from low income families. Poor dental health can negatively impact on every aspect of a person's life from their health and well being through to employment and economic opportunities. After all poor dental health is the third highest cause of preventable hospital admissions with more than 63,000 Australians hospitalised each year.
It will represent a doubling of the Commonwealth current contribution to the states and territories for public dental services and for the first time it will be enshrined in legislation to provide long term certainty for current and future generations.
We are helping these families by funding what we can afford. What you hear me announce on May 3 will be based on the things that we can afford by saving the money where we need to save the money, to invest the funds where we need to invest the funds for the good of Australian families. You certainly don't help families by imposing a $100 billion tax burden in addition on the Australian economy over the next ten years as our opponents propose to do.
By creating the right economic circumstances in which families can flourish we will be setting ourselves up for future prosperity and stronger families. I can assure you that families will be at the heart of the Turnbull Government's Budget. It was John Howard, in my view the greatest ever Prime Minister, who saw the mission – I am a parochial New South Welshman, apologies to my Victorian cousins they have another candidate Mr Menzies, he was pretty good my grandfather loved him. It was John Howard who saw the mission of his government to "restore to Australian families a sense of confidence and optimism about their country's future; to bring within the reach of more families the prospect of good jobs and rising living standards; and, to open up new avenues of choice for families, especially those on modest incomes".
This is a mission the Turnbull Government shares and as a Treasurer I seek to follow in the footsteps of our finest ever Treasurer, Peter Costello who was the one who was implementing the measures that served Prime Minister Howard's objective. But we will do it in the context of today's challenges. Every Treasurer is faced with a different set of economic circumstances, different budgetary requirements, different global conditions but it is your values and your objectives that remain the same and remain consistent.
Everything we do will be driven by boosting jobs and growth which in turn will give families a greater chance of success and when our families are stronger our society is stronger.
I would ask you to continue to pray for that outcome in your own private life and I thank you once again for the many prayers of support that you have provided to me over the last nine years in public life and hopefully a lot longer.
Thank you very much.