Speech at G20 Labour and Employment Ministers’ meeting. Second session: Labour Activation, Equity and Inclusion, Moscow, Russia

Speech

Acknowledgements omitted

Introduction

It’s honour to be here representing the Australian Government and I thank the Russian Federation for hosting this meeting and for the generous hospitality extended to the Australian delegation.

In the wake of the Global Financial Crisis, Australia avoided recession – a direct result of our government’s decisions to support our economy and jobs in turbulent global times.

Since our government came to office in November 2007 – we have created almost one million jobs – an increase of almost 10 per cent of total jobs.

Our economy has grown by more than 10 per cent since the GFC.

Our government’s average unemployment rate over this period is 5.1 per cent and is currently at 5.7 per cent. Our interest rate of 2.75 per cent provides considerable further room to deploy monetary policy if required.

We have low and contained inflation, low debt and a triple-A credit rating from all three ratings agencies.

While the scale and speed of our fiscal stimulus shielded our economy from the worst and prevented more than 200 000 jobs being lost, Australia was not left unscathed – and there's no doubt we're still feeling the aftershocks of the GFC.

Chairman, I have travelled from the other side of the world to be here because of the similar challenges for labour force participation we all face in the context of structural change in the global economy.

Boost productivity – increase competitiveness

In Australia, our resources boom is shifting from the more Labor intensive construction phase to production and exports, and the economy is shifting towards non-mining sources of growth.

To ensure the transition is a smooth one, we need to redouble our efforts to improve productivity and competitiveness.

Australia’s core economic strategy for the future is one which diversifies the economy, and creates more jobs in manufacturing, food production, infrastructure, construction, and our services industries such as education and finance, rather than having all our eggs in just one basket – resources and energy.

The Australian government is focussed on investing in our people, to lift the productivity growth rate by at least 2 per cent per annum, not a race to the bottom on wages.

The Australian people rejected this approach in 2007.

Flexibility and regulation mean different things to different people. In Australia, we believe in a responsive labour market, but one that maintains a decent standard of living for working families.

As a result we are building a better educated, better trained, better skilled workforce.

We now have universal pre-school education supervised by teachers for a minimum of 15 hours a week emphasising pre-literacy and pre-numeracy skills.

We now have national student assessment to make publicly transparent the literacy and numeracy performance of all schools.

We are increasing investment in schools to lift standards and education outcomes.

We have uncapped university places for Australian students so that we now have 190,000 more young people at university than five years ago.

That’s also why we’re implementing plans for industry-led training, apprentices, and reform of the vocational education and training sector.

By matching industry needs with training, we will deliver the skills our economy demands and ensure students can get a job once qualified.

If Australians are to take advantage of the opportunities of our proximity to the growing Asian economies, we need to ensure we have the better educated workforce equipped for the jobs of the future.

These investments are about making sure our population has the skills they need to take-up the jobs being created in the future.

Labour force activation

Through education and training, Australia is also preparing people out-of-work, and those suffering entrenched disadvantage, to return to the labour force.

We’re rewarding participation with more training and better incentives for those who face big barriers to employment.

But moving people from welfare to work requires the right balance between welfare, employment and training policies.

Australia’s experience is that well designed and targeted labour activation policies are a powerful tool to assist disadvantaged members of the community.

Australia’s policies align public employment services with the income support, taxation and training systems to ensure strong incentives to work, along with access to training, job matching and other support.

This has been recognised in the OECD’s report on labour activation, and by the Taskforce.

For example, by allowing people to keep more of their income support, as they start to earn a regular wage, we have removed one of the key disincentives to work.

At the same time we have introduced paid parental leave and increased access to child care, particularly for the most disadvantaged, removing further barriers to participation.

The fundamental reforms we have made to employment services – reforms which were being implemented at the height of the GFC – have led to more tailored assistance to job seekers, and have focussed more of the State’s resources on the most vulnerable including the long-term unemployed.

The OECD found that these reforms resulted in a doubling of the employment outcomes for the most disadvantaged job seekers.

We introduced a “learn or earn” compact for our young people – in order to receive financial support from the Government – young people needed to be working, or in education or training.

We focussed resources on the geographical regions of highest unemployment, including the creation of local employment coordinators – skilled professionals whose job it was to match and create local employment opportunities.

Conclusion

It’s clear the G20 economies need to continue their efforts to encourage greater labour force participation while increasing employment opportunities.

All economies need to undertake reforms that will both lift and rebalance growth.

With hundreds of millions unemployed globally, it is vital this work has the creation of jobs and labour activation at its centre.

Australia is looking forward to welcoming representatives from the G20 economies to our country next year. I also note the suggestion by G20 members and B20 and L20 participants for Australia to maintain a Labour and Employment Minister’s meeting.

The urgency of crisis may have passed but we must resolve to maintain the momentum of the early stages of the G20 to meet these continuing challenges.

These forums – of shared ideas and experiences – are vital - where those shared ideas and experiences are supported by evidence, not ideology, and result in concrete action by Governments.

I’d like to again thank our Russian hosts for the opportunity to address my ministerial colleagues today.

For more information

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