Page 4945 - Week 13 - Thursday, 12 November 2009
Next page . . . . Previous page . . . . Speeches . . . . Contents . . . . Debates(HTML) . . . . PDF . . . . Video
organisations rely heavily on government contracts for their day-to-day business, which do not allow for the whims of government to reach into their administrative practices in the way that this bill contemplates.
What are the concerns of the community sector? Their main concern is one of uncertainty. The community sector has noted, for example, that the construction industry fund made a loss of over $5 million in 2008-09 and more than $11 million in 2007-08. The cleaning industry fund made a loss of almost $400,000 in 2007-08 and a profit of just $38,000 in 2008-09. This raises uncertainty about the stability of the levy in percentage terms if the sector is expected to prop up operational losses.
A question being asked is: will the government guarantee the capital value of the asset base as well as the annual long service leave liability or will the sector be expected to fund levy fluctuations for a fund over which they have no control? I ask this: will the government do something about any fluctuations in the levy?
There are financial and cash flow concerns, particularly for smaller community service organisations, many of whom have very few staff, often working in inadequate environments, using a chair that is falling apart, and perhaps even struggling to find a pen that works. One community organisation said that their actual annual cash outflow for long service leave will increase from $9,000 to $60,000 under this scheme. They said that they will have to lose staff in order to be able to meet that cash flow obligation. How does this enhance employment retention and opportunities in the community sector, and how does this enhance service delivery in the community sector?
There are many other organisations who have told me of this kind of impact. I ask: will the government provide supplementary funding to assist those organisations to cope with these new extra cash flow stresses? The government has given no undertakings in this regard. Indeed, feedback from the sector is that the government has rejected any possibility that additional financial support will be provided.
Other organisations that quarantine cash when they make their long service leave provisions invest that cash, which generates some income for the organisation. They will lose that capacity to earn additional income if they have to pay it into the authority. Then there is the possibility that an organisation might take on a new employee only to find that that employee is entitled to and wants to take long service leave because of their service in the sector.
I ask this: are organisations going to be willing to take on new employees if they are due to take long service leave? Conventionally, long service leave is considered a reward that is available to employees for service to their employer. This bill removes that benefit from the offering of an employer, but expects the employer to pay for it nevertheless. Quite the contrary to enhancing retention, it removes an element of overall employment benefit that an individual employer can offer its employees.
Of considerable concern to the Canberra Liberals is the impact on service providers offering fee-for-service childcare. The changes to the long service leave scheme will increase their childcare fees, thus imposing another cost on families already struggling
Next page . . . . Previous page . . . . Speeches . . . . Contents . . . . Debates(HTML) . . . . PDF . . . . Video