House debates

Tuesday, 24 June 2014


Social Services and Other Legislation Amendment (2014 Budget Measures No. 1) Bill 2014, Social Services and Other Legislation Amendment (2014 Budget Measures No. 2) Bill 2014; Second Reading

7:43 pm

Photo of Pat ConroyPat Conroy (Charlton, Australian Labor Party) Share this | Hansard source

I rise to speak on this very important legislation, the Social Services and Other Legislation Amendment (2014 Budget Measures No. 1) Bill 2014 and the Social Services and Other Legislation Amendment (2014 Budget Measures No. 2) Bill 2014. This is a budget built on a lie. It is built on a confected budget emergency. The facts are these: debt is low and will peak at less than one-third of the OECD average. The obsession with this mythical debt problem is symptomatic of a government, of a coalition and of a Liberal Party that have been taken over by people akin to the Tea Party in the United States. They have been taken over by the worst elements of US Republican politics, and they have married it with the worst elements of Thatcherite Conservative Britain. They paint this bleak future and say there is no alternative—TINA—but to gut our social security system to attack low- and middle-income Australians because they have no choice.

It is rubbish. Our economy is in good shape. With modest changes, the economy is sustainable. The priorities they have chosen, including their ridiculous $21 billion gold plated Paid Parental Leave scheme, demonstrate that they are choosing priorities that attack low- and middle-income Australians and defend welfare for the wealthiest in this country. The truth is that they are attacking the families of the people I represent. There is no fairness, there is no justice, and there is no equity in their actions. I will fight them. Labor will fight them.

There are 26,800 people in the electorate of Charlton who receive a pension, including over 18,000 age pension recipients. Every single one of these people will suffer as a result of this budget and these bills. Before the election, Tony Abbott said there would be no changes to pensions. But now he is doing just that. For the past 20 years the age, disability and carer pensions have usually been indexed in line with male average weekly earnings. This helps the pension keep pace with the true cost of living. Now this government is seeking to change the indexation rate for pensions—from average weekly earnings to consumer price index. This will mean pensioners will generally receive less of an increase to their pension in March and September. For example, if this indexation had been in place for the past four years, a single pensioner on the maximum rate would be around $1,500 a year worse off than they are today. This one change, over four years, would effectively wipe out the great pension reform that Jenny Macklin introduced while she was minister for Social Security. It is astounding that those opposite try to argue that this is not a cut. These changes will see the cost of living for pensioners go up, but their pensions will not rise in line with it. The government's own budget papers demonstrate the scale of the cut. It will see 26,800 people in Charlton receive less money each week. No matter which way you look at it, it is a cut.

Today I heard from Desmond, who is 66 years old and lives in Edgeworth. Two years ago, Desmond was diagnosed with terminal heart and lung conditions. He rarely leaves home as he is on an oxygen machine. He visits the doctor each week and knows that the $7 payment to see the doctor, to visit a specialist, to get a blood test or to get an X-ray will have an impact on his bottom line. Despite all this, Desmond says he is 'doing okay'. His wife works and he receives a part pension. He says:

We don't live the high life, but we survive. But if the government takes money out of the pockets of pensioners, we'll be affected in all sorts of ways. We like to visit our son, who lives in Sydney, once a month. With less money, and also because of the petrol tax, we may not get to go as often. We have little luxuries like Henny Penny or pizza once a month. We don't want to lose those little extras that we enjoy. The budget is cruel, it is not realistic.

The government has already ripped $1.3 billion from the National Partnership Agreement on certain concessions for pensioners concession card holders and seniors card holders. This is one of the fundamental reasons why those on the other side are engaging in untruths and falsehoods when they say that there is no cut to the pension. This $1.3 billion, paid to the states and territories, supports discounts for pensioners, Commonwealth seniors and health card holders on rates, water, sewerage, power, car rego and public transport. The New South Wales government released their budget last week; and, despite the New South Wales government's general record of being unable to stand up to their colleagues in Canberra, pensioners and seniors were given a reprieve, with the Liberals state government committing to cover the funding shortfall and continue the pensioner concessions for one year. But it is a short reprieve—and, coincidentally, it takes them past the next state election. It is, however, not long enough to take the issue out of the spotlight and it is not long enough to give any certainty to pensioners and seniors in New South Wales that their vital discounts will survive beyond the next budget and the next election cycle.

These bills will cut the seniors supplement attached to the seniors health card for self-funded retirees. This is a loss of $876.20 per year for singles and $1,320.80 per year for couples. No matter which way you look at it, this is a significant hit to the budgets of people on fixed incomes. In addition, these bills will require people to work harder for longer, by increasing the pension age to 70, the highest pension age across the OECD. We have heard speakers on the other side talk about what action other countries around the world are doing. No country is supporting an increase in the pension age to 70, and the government has provided no evidence to support this increase. It is a measure that will clearly impact on people with physical jobs. It is okay for office workers to be told to work until 70 and it is okay for people like me to be told to work until 70. But my brother, who is in his mid-40s, is a concreter, and I have serious reservations about the his body's ability to hold out until he is 70. And he is one of many manual workers who will really struggle with this change. But it is not just in the stereotypical blue-collar jobs that people will suffer. My wife is a nurse. Most nurses spend their entire day on their feet engaged in heavy lifting, and I doubt that many of them would be comfortable lasting until 70 in their working life. The government did not consult, or take expert advice, before making these changes. It will mean people have to work longer and their pension will be significantly reduced when they finally do get to retire.

Charlton families are under attack by the Abbott government, and those on low incomes—single-income families and single parents—will suffer the most. There are currently almost 11,000 families in Charlton receiving the family tax benefit. Every one of those families will be affected by these changes if those on the other side push this unfair legislation through parliament. Families on family tax benefit part B will now have their payment cut off completely when their youngest child turns six. This will impact on 8,500 families in Charlton.

Karen, from my electorate, is from one of these families. Karen contacted me to share her concerns about the pressure her family is going to experience as a result of these unfair cuts. Karen and her husband live on her husband's income of approximately $60,000 per annum. Their mortgage is around $260,000, and they have two children, aged 11 and 16 years. Karen says these changes are going to make things so much harder to live day by day. She says her family does not live an extravagant life and they are frightened they will have to make some very tough choices if these changes come to fruition—choices like the children forgoing sport and school excursions. Karen's family will be around $6,000 worse off each year by 2016 as a result of this legislation. This equates to a cut of around 10 per cent of their entire family income.

These are not Labor's figures. These are figures produced by NATSEM, the premier modelling outfit in the country on family incomes. This is a modelling organisation that the Prime Minister was very happy to rely on and quote when in opposition, but suddenly when he is in government these figures are not to be believed. How can you equate Mr Abbott's promise before winning the election to help with the cost of living and cutting the income of low- and middle-income families income by over 10 per cent? Imagine the impact on a family on $60,000, which is well below the average income in this country, of losing over 10 per cent of their family income. That will gut their family. It will place massive pressure on the family. Inevitably, it will see more pressure on them, lost opportunities for their kids, and an increase in family tension and break-ups.

And, to add insult to injury, at the same time as this huge, inequitable attack on low-income families, the government are intent on pushing through their ridiculous Paid Parental Leave scheme, which will pay millionaires $50,000 to have a baby.

Just by way of contrast, while 8½ thousand families in Charlton will lose significant income from family tax benefit part B, over 80 per cent of women in Charlton will receive less than $20,000 under the government's proposed PPL scheme, while families in the electorates of North Sydney and Warringah will receive $50,000. Why is a baby in Charlton worth $30,000 less than a baby in North Sydney or Warringah? It demonstrates the skewed priorities of the government.

In addition to slashing family tax benefit part B, the government is proposing that family tax benefit payments be frozen for two years. These measures will disproportionally impact families on the maximum rate, including single mothers and those on the lowest incomes. Many of these families are already struggling to make ends meet. They are already cutting back and they feel they are being targeted by this government.

Felicity, in my electorate, is certainly one of those who will be directly affected by these cuts. Felicity says:

I'm a single mother of a 7 year old Autistic daughter. Losing the FTB Part B will mean I will not be able to afford the rent on my house. I live in private rental accommodation due to a 20+ year wait list for department of housing. My rent is $280.00 per week.

I pay my rent and get a little food shopping, then I am broke till my carers payment comes in the next week. I save hard to pay for specialists for my daughter. I can't afford a specialist for myself so I don't go, this can affect my health!

I will have to rely on community centres for food packages each fortnight just to get through.

My daughter will end up going without so I can provide a roof over our heads.

Labor is opposing what I can only describe as some of the meanest cuts I have ever seen, to some of the most vulnerable people in our communities.

We are opposed to cutting parenting payment single; freezing of the payment rates for family tax benefit; slashing family tax benefit end-of-year supplement and ceasing indexation; and cutting families from FTB part B when the youngest child turns six.

We oppose these measures because they stand in stark contrast to our values. Labor's approach to social services will always be one of fairness and equity. We are opposing these measures because they are deeply unfair and grossly inequitable. Those on the other side just do not get that and they do not get it because they do not share our values. They never have and they never will.

I have already brought to the attention of the House many harsh measures in this budget, but perhaps the most cruel of all are those which will impact on young people looking for work. This government is destroying the social security safety net. This bill contains measures which will exclude young job seekers, under the age of 30, from receiving Newstart benefits for six months. Once eligible, the benefit will only be available for six months per year. That means that, if you are under 30 and, for whatever reason, you find yourself out of work then you are on your own. You will not receive assistance from this government.

School leavers will face more than a decade of this instability, their choice now being between further study, through which, thanks to the government, they will now accrue a significantly higher student debt, and throwing themselves at the mercy of the six monthly 'on again, off again' income support cycle. Labor will not support this measure.

The well-known and respected Novocastrian, Marcus Westbury, wrote in the Newcastle Herald recently on this topic, saying:

It's hard to understand the logic here. Youth unemployment rates usually track well above the rest of the community. Young people are the least likely to have the savings to work their way through it. It's a recipe for crime, drugs, desperation and despair—for harming yourself and harming others.

It's a system that takes the potential leaders and contributors of tomorrow and dumps them on the scrap heap before being given a chance to find their feet.

It isn't just deeply unfair: it will be a matter of life and death for some young Australians. Our kids. Our friends. Our families. We are cutting people off from the ability to eat, to pay the rent, to survive.

The budget is built on a lie. It is a confected budget emergency. It is an excuse to break solemn promises those opposite made before the election: no changes to the pension, no cuts to health, no cuts to education. The Prime Minister, before the election, was asked very clearly and very specifically, what would happen if he came to government and the figures around the budget were different from those disclosed previously. He said, 'This will be a government of no excuses that will not change his policies.' He is clearly in breach of that promise and, quite frankly, he has no excuse because the Pre-Election Economic and Fiscal Outlook clearly painted what the fiscal picture was and he is using a confected budget emergency to pursue his ends.

The government realise they have a fairness problem. And it took them awhile to realise this. But the Australian people see their budget as fundamentally unfair. That is why the government keep trying, very unconvincingly, to talk about fairness in question time. But no matter how much you repeat it, it does not make it true. Saying something is fair does not make it fair; saying something is necessary does not make it so. The measures in this bill that we are opposing are an attack on the fabric of Australian society. It is an attack on the modern Australian settlement and it is an attack on equity and fairness. We will fight this attack. We will defend low- and middle-income Australians. We will defend our historic Labor values, while those on the other side mire themselves in hypocrisy, cant and crocodile tears.


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