What the Federal Budget 2021-2022 Means for Young People

Young people were forced to sacrifice so much of their lives for the broader community during COVID-19. Young people were the first to lose their jobs, their education and other crucial rites of passage were disrupted or missed altogether. For many, goals and ambitions were dashed by this generation-defining pandemic.

Yet, beyond a few short-term announcements on youth employment and skills, young people have been left out of the 2021-22 Federal Budget and the ongoing recovery from COVID-19. Read our full media release here.

The ongoing COVID-19 pandemic will disproportionately impact and scar young people’s lives for years to come. This Budget fails to recognise the important sacrifices of young Australians, and largely leaves young people out of the COVID-19 recovery and future prosperity.

Employment

The Budget noted that employment was going up after COVID-19 put thousands of people out of work. Currently the unemployment rate is 5.8 per cent in Australia, however this figure does not capture people who have stopped looking for work or have returned to full time study. The youth unemployment rate remains high at 11.8 per cent. To support people into employment, the federal government has announced:

• $9.3 billion over five years to increase and expand income support payments including increasing the base rate income support payments by $50 per fortnight including JobSeeker, Youth Allowance, Parenting Payment, Austudy, ABSTUDY and others. The rate of income support payments is still below the poverty line despite repeated calls from YACVic and other organisations around the country to raise the rate,
• Expanded eligibility criteria so more people can get income support payments, including part time or casual workers with few hours.
• $2.5 million to allow employers to dob in job seekers who are perceived to be disingenuous in their attempts to find work, which will harm young jobseekers
• $860.4 million over four years to transition employment services from the current jobactive model to the New Employment Services Model (NESM) which aims to be more efficient and allows eligible job seekers to choose online meetings instead of face-to-face
• $506.3 million over two years to extend the JobTrainer Fund which will deliver 163,000 low-cost or free training places
• $2.7 billion over four years to expand the Boosting Apprenticeship Commencements wage subsidy. Eligible businesses and Group Training Organisations can get a 50 per cent wage subsidy for 12 months for each apprentice or trainee they hire
• $481.2 million over four years to expand and continue the Transition to Work program to provide specialist youth employment services for young people aged 15 to 24
• Major investments in industries like childcare and aged care will create jobs, many of which will be available to young people
• Cutting support to newly arrived residents by excluding them for four years from most income support payments. This will save the government $671 million but will leave thousands of marginalised people without any support. Concerningly, there is no detail about who will be excluded from payments

This Budget provides some support to unemployed and underemployed young people, but still leaves many young people behind. Increases to income support payments are welcome, but the government has chosen to push people below the poverty line by only increasing the amount by $50 a week. Funding for vocational training and apprenticeships will provide much-needed support to some young people. Overhauling the broken employment services system are long overdue and YACVic welcomes the government’s commitment to improving support to people looking for work.

Now, young people looking for work will be referred to the youth focused Transition to Work program instead of being lumped in with other jobseekers, reflecting young people’s different experiences and needs. We urge the government to meaningfully engage young people in designing the new model to ensure that it properly supports young people looking for work. YACVic is disappointed that our recommendations for a Youth Employment Guarantee and a Youth Employment Commissioner to address the issues of underemployment and unemployment of young people have not been heard.

Mental Health

The federal government will invest $2 billion over four years in a National Mental Health and Suicide Prevention Plan. Some initiatives are still to be decided with each state and territory. The federal government has announced:

• $111.2 million over four years to expand and enhance digital mental health services
• $5.7 million to build on the Individual Placement and Support (IPS) program that supports people with mental illness to participate in the workforce, including to trial Youth Vocational Peer Support Workers at two IPS headspace sites
• $158.6 million over four years to provide universal aftercare services for everyone discharged from hospital following a suicide attempt
• $278.6 million over four years to expand and enhance headspace youth mental health services
• $46.6 million over four years to support parents and carers of young people under 12 years old and assist with early identification and intervention of mental illness
• $79 million over four years to implement initiatives under the National Aboriginal and Torres Strait Islander Suicide Prevention Strategy providing crisis and support services for Aboriginal and Torres Strait Islander people
• $16.9 million over four years to provide mental health services and support to Australians from culturally and linguistically diverse communities, including for survivors of torture and trauma
• $58.8 million over two years to fund initiatives to attract, upskill and re-distribute mental health professionals and increase the number of Aboriginal and Torres Strait Islander mental health workers
• $4.0 million in 2021-22 to continue to provide up to ten free trauma and distress counselling sessions for those impacted by the bushfires
• $3.1 million to boost and support the mental health peer workforce through scholarships and professional collaboration

This Budget’s investment in mental health support is welcome, especially after the year we have had. Targeted investment in digital services, expanding headspaces and suicide aftercare are welcome initiatives. Funding to increase the mental health workforce, including the peer workforce, could help reduce the waitlist for support. YACVic stands with Orygen in applauding the Budget’s investment in mental health services while calling for more to be done to address the needs of the ‘missing middle’, young people whose needs are not met by the current mental health system because they are too unwell for primary care, but not unwell enough for intensive supports.

Housing

The Federal Budget outlines the government’s commitment to ‘supporting construction jobs and home ownership’. This includes specific grants and loan guarantees each with strict eligibility criteria. The government has committed to:

• Expanding the New Home Guarantee, which allows first home buyers to build or buy a new home with just 5 per cent deposit, with the government guaranteeing up to 15 per cent of the loan. They have added an additional 10,000 places for singles and couples to access the New Home Guarantee.
• Supporting 10,000 single parents with dependent children to purchase a home with a 2 per cent deposit. Of the 125,000 places available, the government expects that 105,000 will be taken up by women.
• Paying their share of $124.7 million towards housing and homelessness services through the National Housing and Homelessness Agreement

The Budget will help some first home buyers access a housing market that is spiralling out of control. While these initiatives are welcome band-aid solutions that will get some buyers into the market, increasing competition through these initiatives will likely increase prices, pushing homes further out of reach for many more young people ineligible for these grants. The measures do nothing for young people in the private rental market and the government has ignored calls for investment into social housing and better regulation of the housing market.

Gender equity

This federal Budget has a strong focus on women, in a context where the pandemic has disproportionately affected women and ongoing criticisms of the government’s own gender issues. This Budget has made commitments to:

• $998.1 million over four years for initiatives to reduce the prevalence and support victims of family, domestic and sexual violence
• $1.7 billion investment in childcare to increase the affordability for low- and middle-income earners to support parents, particularly women, to get back into the workforce
• $17.7 billion towards aged care, partly in response to the Royal Commission into Aged Care, which will give a boost to a sector which overwhelmingly employs women

These announcements are a positive start, but the government remains focused on issues that are not always a top priority for young women. There are no new initiatives or services to address violence and safety and while support for people experiencing family violence is welcome, there is no consideration of young people’s experiences and needs in this context. YACVic urges the government to invest more in gender equity initiatives and targeted support for all young people who experience gender-based discrimination and violence, including trans and non-binary people.

Disability

The government is pushing ahead with trials of independent assessments despite strong criticism from the disability sector. They argue that restricting and standardising access to the NDIS is necessary to the long-term sustainability of the scheme as the cost of the NDIS is now forecast to be $32.7 billion by 2023-2024 in line with original estimates from the Productivity Commission in 2017. In this Budget, the government has increased its commitment to the NDIS by $13.2 billion over the next three years to meet demand.

Higher education

Australia’s universities are under pressure because of a lack of fee-paying international students and their exclusion from JobKeeper last year. Many young people are turning to higher education after losing their jobs in industries hard hit by COVID-19. This Budget provides:

• $26.1 million over four years from 2021-22 to assist non-university higher education providers to attract more domestic students through offering 5,000 additional short course places in 2021

No specific funding will be provided to universities through this Budget which, along with the Job Ready Graduates bill which overhauled course fees, will likely reduce the number of university places for young people. After a joint, nationwide campaign, Youth Work has been included in the list of courses with reduced fees along with Social Work, meaning people studying Youth Work at the Bachelor level will pay $ 7,950 per year instead of up to $14,500 per year as originally planned by the government.

Environment and Climate Change

YACVic is disappointed to see the government’s focus on and investment in the gas industry, instead of renewable energy and climate action. Young people have been calling on the government to act on climate change and invest in a just transition from fossil fuels, yet their voices have been ignored in this Budget. The government has committed to continuing to subsidise coal, oil and gas, as well as providing nearly $40 million to small mining companies to explore and dig new mines.

Industries affected by COVID-19

Certain industries have been disproportionately affected by COVID-19 and many of those industries employed a high proportion of young people. With the end of JobKeeper and the Coronavirus supplement to income support payments, many young people will struggle. The government has committed to spending $2.1 billion on targeted supports for aviation, tourism, the arts and international education providers which will provide much-needed support to workers in those industries. This includes:

• $125.6 million over two years to expand the Restart Investment to Sustain and Expand Fund which supports events and productions
• $50.8 million in 2021-22 to extend the Temporary Interruption Fund to further support the local film and television sector to secure funding to commence productions
• $10.0 million in 2020-21 to music charity Support Act to provide further relief for artists and arts workers

Rural and Regional

The Budget makes some welcome commitments to rural and regional Australia, although provides limited support directly to young people. The Budget has not addressed the lack of farm workers and has missed the opportunity to make agricultural work a viable option for young people by providing accommodation, transport and mandating minimum wages. In rural and regional Australia, the Budget will provide:

• $80.9 million over five years to support primary care and the health workforce in rural and remote Australia which will create incentives for health workers to move or stay in regional areas and support to train allied health professionals in rural and remote Australia
• $100 million to upgrade internet in regional and rural areas, especially in areas where bushfires are common.
• $15 million for ‘Melbourne to Mildura – Future Priorities’ which will improve roads, but not rail
• $10 million for the Mallacoota-Genoa Road Upgrade
• An extension to the instant asset write-off for farmers, encouraging them to make big purchases
• A waiver of almost $15 million of debt owed by farmers receiving the Farm Household Allowance from Centrelink

 This summary was written by Sebastian Antoine, YACVic Policy and Research Officer. If you have any questions or concerns, please email policy@yacvic.org.au.