Wednesday, 23 June 2010
Questions without Notice
My question is to the Minister for Veterans’ Affairs and Minister for Defence Personnel. Minister, does the Rudd Labor government believe it is a fair and equitable policy for men and women who have served courageously in our Defence Force, in harm’s way and on behalf of the people of Australia, to have their military pensions indexed at a significantly lower rate than our aged pensioners—and of course substantially lower than the pensions of members of the Australian parliament? If the minister does not believe this is fair, what exactly is the Rudd Labor government’s policy on this fundamentally important issue of military pensions indexation for the veterans of the Ryan electorate, and indeed veterans across the country?
I thank the member for his question. This is of course an issue of real concern to many military superannuants across the nation. Unfortunately it has been an issue of concern for many years now. The circumstance before the last election was the current government, the then opposition, came forward with two principal promises at the election with regard to this issue. One was to conduct an independent review to examine the indexation methodology and to see whether in fact it properly reflected how superannuation payments ought to be treated. The other was to release the report of what was commonly called the Podger review into military superannuation which had been conducted over a year and a half under the previous government. It had been in the possession of the then government for some months, but not released prior to the election.
The review in relation to indexation was conducted by Trevor Matthews, a distinguished actuary. That review came down with a set of recommendations, which I believe the member is familiar with. Those recommendations were that the system should not change currently; that the government should investigate if a potentially superior or more appropriate indexation method became available and to look at that, but otherwise not to change the system. Circumstances are that the government accepted those recommendations.
As for the situation that the member mentions, I will go to both issues. One is the position around superannuation for members of parliament. As he is aware, the system has changed in recent years and certainly with regard to new members of parliament—those who have been here over the last couple of terms—the circumstances are that they are not under that more beneficial scheme. I admit I certainly am, as are many here in the chamber still, but we are fading fast.
As for the question about the issue of age pensions, we have to be careful about the use of the word ‘pension’. It is a word that creates a lot of concern within the veterans community as to what in fact a pension is. The clearest point we can make there is that pensions are periodical payments, but there are in fact different types of what are commonly called pensions. The age pension is an income support payment that is part of the safety net provided to those who do not have access to other forms of income. If they receive it on a part basis then they receive it on a graduated basis according to other sources of income. It is designed to protect the poorest in society; it is designed to ensure that those who need it get it.
This government through the Harmer review made significant changes with respect to that and in fact with respect to those that I have responsibility for in the veterans affairs portfolio with some $1.1 billion worth of income support payments over the forward estimates. The circumstance with respect to a superannuation pension is that it is on top of that—it is an additional payment. Many of those military superannuants that the member is concerned about and that many of us are concerned about are in fact also part pensioners at the very least and receive income support payments to a degree according to their individual circumstances.
I know the member has been concerned about this issue for some time because I am aware that in fact earlier this year, I think, he endeavoured to move a motion during private members’ business with respect to this issue and was apparently not given permission by the opposition to move it. I understand that is something that has been a cause of some concern within the veterans community in recent times.
I would also make the point that this has been an issue for a long time. The circumstance with respect to that is that the situation of the opposition also needs to be focused on. My understanding is that the Leader of the Opposition has made a statement along the lines that, when back in government and when the budget is back in surplus, there will be a need to ‘tackle this issue’. My question to him is—
As a minister in a government that had surpluses for most of those 10 years, why was action not taken then? I think that is a question that also has to be asked out there within the community in terms of the bona fides of those present here today.
The situation with respect to the government’s position in response to the Podger review into military superannuation is that we agreed to consult with the ex-service community and the defence community post the last election, subsequent to the release of that report. We did and the response from those communities was, ‘We don’t like it; we don’t want it.’ That has produced a dilemma for the government—there is no question about that. My commitment, and I have made it quite public, has been that we will be releasing a position on military superannuation in the next few weeks. I will be ensuring that that is there for the ex-service community and the defence community to consider in the lead-up to the next election. I am committed to doing that and the government is committed to taking action.