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

8:50 pm

Photo of Natasha GriggsNatasha Griggs (Solomon, Country Liberal Party) Share this | Hansard source

There they go again: more Labor scaremongering. The depths that they will go to do not amaze me. I rise to speak on the sensible budget measures introduced by this government to return to a sustainable welfare system. There is no denying that this budget is a tough budget, but this is a budget that Australia needs to return to sensible levels of government spending and to one day be able to return to surplus. This budget calls on all Australians and all businesses to contribute to, to join or to grow the workforce, to boost productivity and to help build a stronger economy with more investment. Unfortunately, due to the previous Labor government's unprecedented spending spree, all Australians now have to pay for their total and utter incompetence. The Abbott government will work with all Australians to ensure that, when we tighten our belt on the government's spending, we only do it where we can afford to and where it is appropriate. This means supporting our most vulnerable and taking significant steps towards ensuring that the government can live within its means. This government will ensure there is a safety net for those Australians who need it. We will never, ever leave an Australian on their own whilst they genuinely need government support. We will always ensure that those who need extra assistance will get it in their time of need.

Currently Australian taxpayers are paying $1 billion a month in interest on top of the Labor government's debt. It is clear that we have to address this issue. That is what the Australian public elected us to do. It is the government's responsibility to clean up Labor's debt and deficit mess, and that is exactly what we are going to do. This government has reduced the Labor deficits by $43.8 billion through to 2017-18. Australia cannot continue to live beyond its means. Gross government debt is forecast to be $389 million in 2023-24. Compare that with the $667 billion that Labor left, including providing for future tax relief to address bracket creep.

Whilst we are cleaning up Labor's mess we are taking care with the social services budget to ensure that those who need assistance still receive everything they need. The 2014-15 budget includes $146 billion in social security spending. That is approximately 35 per cent of budget expenditure. Those on the other side will have you believe though that we are not doing anything of the kind. These bills introduce a package of measures to give effect to the government's budget spending and savings in the Social Services portfolio. The aim of these measures is to create a sustainable welfare system for all Australians in need. We also aim to increase everyone's ability to contribute to the economy. Everyone who can contribute should contribute. These bills include, as I said, 35 per cent of budget expenditure on social services, including pensions, family payments, unemployment benefits, student benefits, disability payments and childcare support.

With our population ageing, government spending has been growing faster than the economy, especially in the area of age pensions. In 2013-14 spending on the age pension alone will reach $40 billion. This just is not sustainable without making some sensible changes. This is the responsible thing to do to ensure we can actually still afford to pay an age pension in the future. By mid century it is predicted that there will be relatively fewer Australians participating in the workforce and paying tax to support those on the age pension. Without policy reform the cost of the age pension is projected to increase by 70 per cent over the next decade from almost $40 billion a year currently to $68 billion a year.

Let us make one thing clear: the government has not made any cuts to the age pension. Those on the other side will have you believe something else, but let me reiterate: the government has not made any cuts to the age pension. The age pension will continue to go up twice a year, as it does every year, to keep up with the cost of living. But we are making structural changes. This will ensure the long-term sustainability of the age pension.

Another change is increasing the pension age. Because Australians are living longer and healthier lives, reforms were announced in the 2014 budget to ensure the age pension system is sustainable and able to meet the future demands. That is the priority of this government to ensure that the age pension system will actually continue in the future. The increasing costs are due in part to changes in our demographics as well as Australians having a far greater life expectancy than they have ever had before. Between 2010 and 2050 the number of people aged from 65 to 84 will more than double and those aged 85 and over will quadruple. Back in 1909, when the pension was introduced with the eligibility age of 65, Australian men were living till 55 and Australian women were living to 59. Those were the averages. Since 1909 Australians' life expectancy has risen by about 25 years yet our pension age has stayed the same.

Like other governments around the world, this government will raise the age pension age. The previous Labor government scheduled the age pension age to increase to 67 in 2023. Our change will raise the eligibility age in 2035 to 70. These changes are inevitable with an ageing population and are necessary to keep our age pension system sustainable. I will repeat, given that the Labor Party are getting so confused with this simple point: this budget does not deliver any cuts to the age pension. It will continue to increase twice each year to keep up with the cost of living.

We are also making structural changes to the disability support pension. Currently I am fully supportive of, and am involved in, the disability sector in my electorate of Solomon. From 1 July 2014 changes to the disability pension will help support young people with a disability to enter the workforce if they are able to do so. The government recognises that people with a disability who are able to participate in the workforce will have better long-term outcomes if they can engage in the workforce. I have seen these endless benefits firsthand with my engagement with the disability sector.

Being able to earn an income brings an enormous sense of independence, gives confidence, promotes self-worth and gives practical skills to use in everyday life. The social, economic and health benefits of workforce participation cannot be understated. Compulsory workforce activities, such as work experience, education, training and job searching, will help certain disability support pension recipients aged under 35 find and keep a job. However, this government, as always, has kept a clear safety net in place for when this new measure would be unsuitable. People with a manifest disability or with a work capacity of zero—


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