Tuesday, 5 February 2013
Social Security and Other Legislation Amendment (Income Support Bonus) Bill 2012; Second Reading
I rise to speak on the Social Security and Other Legislation Amendment (Income Support Bonus) Bill 2012. There is a central question which the coalition has in relation to this bill, namely: where is the money coming from? This bill introduces a new twice-yearly payment for persons in receipt of certain income support welfare. This measure is part of the so-called Spreading the Benefits of the Boom package from the 2012-13 budget. In his press release on 8 May last year, the Treasurer noted:
The Benefits of the Boom package will be funded by re-directing Minerals Resource Rent Tax revenue intended for the company tax cut.
So how is this going to be funded? By the mining tax—and hasn't that tax been successful! It is another failed Labor policy.
The bill would amend the Social Security Act 1991, the Social Security (Administration) Act 1999, the Farm Household Support Act 1992 and the Income Tax Assessment Act 1997 to create a new income support payment, a payment that the government will have to borrow money in order to pay. This profligate government is going to borrow even more money to provide a new payment, a payment that it pretends is being funded from a tax that has raised no meaningful revenue—and if the government has a different view about that then perhaps in the course of this debate it could inform us, but on the best information available to us there has been no meaningful revenue raised by the so-called mining tax.
This government has presided over a massive rise in the cost-of-living pressures that these people face. The government is now cynically trying to confuse and deceive these Australians by pretending to have the money to deliver a new payment of $1 billion or more over the forward estimates. In other words, that is $1 billion to be borrowed in order to make these payments. I wonder how ordinary working Australians feel about that.
Courtesy of a direct impact of the carbon tax, over 2012 the cost of electricity rose by 17.7 per cent, and the cost of gas and other household fuels has risen 17.3 per cent. If the government were serious about helping Australians facing cost-of-living pressures, they could repeal the carbon tax. They cynically want to paint a picture that they will actually deliver new financial support. But, once again, this shows that the Labor government cannot be trusted.
And where is the evidence that they cannot be trusted? One only needs look at the carbon tax deception, or the budget surplus deception, or the deception that there would be a community consensus on carbon trading, or that company tax would be cut or the massive cuts to defence. One might say that there is a track record of deception from a government that misleads and deceives and from a Prime Minister who knifed her boss and is now demanding that her colleagues stop leaking to the press.
The income support bonus comes with a $1 billion price tag. Let me be frank, Labor cannot afford it, and they know they cannot afford it. Let's be clear: this new payment would supposedly be funded by a mining tax that has failed to raise the money that Labor promised. The fact is that, therefore, according to the Treasurer's own design, this payment is unfunded. As I said, this is going to be more raising of revenue by way of borrowings by the government in order to make this payment over the next four years. If the government had not wasted so much money on pink batts and on school halls and the like, then it might be able to fund this measure without throwing even more money on the nation's credit card. The Prime Minister began this parliamentary term by breaking her promise that there will be no carbon tax under the government she leads, and she finished 2012 by breaking her promise to deliver a surplus in 2012-13. She now expects the Australian people to trust her when she promises that she can afford this new payment.
Australian families are fed up with the deception and the deceit and the broken promises that are consistently served up by the Labor government. Division and dysfunction rule the day in this government—a government led by a Prime Minister incapable of keeping her promises, a Treasurer incapable of delivering a surplus and ministers incapable of understanding that a quick and unfunded cash splash will burden future generations with more debt. The coalition have been on record for a long time with our commitment to scrap the mining tax because it is a bad tax for Australia, and consistent with that promise we will oppose this bill.
I rise to support the legislation, and in doing so I say that it is no surprise to any member of the government that the opposition is opposing the legislation. It opposes everything. It is an opposition that says 'No, no, no.' The other aspect of members on this side of the House not being surprised about the opposition opposing this is that we on this side of the House believe that there should be support for people on low incomes. Those on the opposition bench want to support those on high incomes, and there is nothing that demonstrates this more visually than the fact that their changes to the Paid Parental Leave will benefit people on very high incomes whilst disadvantaging those on low incomes. They are going to take away tax relief to low-income earners and support those on high incomes.
The legislation we have before us today recognises the fact that the people who are on some form of income support such as: Abstudy; living allowance; Austudy; Newstart allowance; paid parental partnered payment; Newstart parenting payment; partnered parenting payment; sickness allowance; special benefit; youth allowance for apprentices, job seekers and students; transitional farm family payments or exceptional circumstance relief payments are people who do not have a lot of disposable income. The government recognises that from time to time these people find themselves in significant financial hardship. I know that I would find it very difficult—I would have to say impossible—to survive on any of these allowances.
It is extremely challenging when you have to make very few dollars go a long, long way, and I have met with single parents today who have told me their story about how hard it is for them. This income support bonus will be more than welcome by them as they struggle on a day-to-day basis looking after their children whilst they have very little disposal income. Many of them are very prepared to get a job. Some of them work part-time, but still it is very, very difficult to make ends meet. The government recognise that people struggle, and that is why we are putting in place this support bonus which will provide $105 to single recipients on a six-monthly basis. It will be paid in March and September, and the first payment will be made in March this year.
I really believe that the opposition need to develop a bit of a social conscience. They need to understand that not everybody receives the wages that they do. Some people find it difficult to pay their basic utility bill and, if something goes wrong with their car and it needs repairing, they have got absolutely no way to get that money, and a car is very important for a person who is looking for work or going to university.
I would encourage those on the opposite side of this House to rethink their position in relation to this legislation. I might add that it is not only those people who are on the allowances I mentioned earlier but also those people who receive payments under the Veterans' Children Education Scheme and the Military Rehabilitation and Compensation Act Education and Training Scheme. They will also receive this supplement. I think it is something that is well deserved.
I was talking about how single payments would be $105 every six months and those people who are in a relationship, or partnered, will receive $87.50 for each partner every six months, which equates to $350 a year or $150 per six months. In the case where one of the partners is in respite care or in some other way has to live away from home, the other person will receive the single income support.
This is good legislation. It is delivering some support to the people who are doing it hardest of all in our society. They are the people who look to this parliament for support. They are the people that find it difficult to visit the dentist and pay for dental work to be done. They are the people that those on the opposition benches tend to ignore. They really are not prepared to acknowledge their existence or acknowledge that they have needs. Rather, they are only interested in acknowledging those people who have significant levels of income. The government should provide support for those people who most need it, not provide middle-class welfare. The government is targeting its policies towards those people who look to government for support.
The Senate had an inquiry into the adequacy of the allowance payment system, and it has brought down a report with some very significant recommendations. I know that the minister is very seriously considering those recommendations. I would say to members of this House that if we, as members of parliament, want people to find jobs, if we want our young people to train and get the qualifications they need to find a job, to be self-sufficient, then we need to support them along the way. If a person does not have the resources to get themselves to work, if a person does not have the resources to find a job, then as a parliament—not only as a government—we fail. We have a role to increase the participation of people in the workforce. We have a role as a parliament to ensure that each and every person has an opportunity. To ensure that people have opportunity, we need to make sure that they have the resources to reach out and grab that opportunity.
Those people in receipt of parenting payments have so many demands upon them—demands upon their time and their finances—and once again this legislation does provide a level of support to them. I remain totally unconvinced by the argument that was put forward by the member for Menzies. I would have to say to the member for Menzies that as members of parliament we have to look at the priorities and the decisions we can make. We have to look to whether we have a social obligation to those people in our community who struggle and are doing it a little bit harder than the rest or whether our obligation is only to those people who have financial resources and are able to support themselves. I argue that we have an obligation to both groups, but I would argue that we have a very special obligation to those people who struggle from day to day. Whilst this bonus is not a large one, it will help a lot of people and they will be able to use it for the types of things that I have mentioned in my contribution to the debate.
I ask the member for Shortland to resume her seat. The member for Kennedy will leave the chamber if he is going to persist in using that mobile phone. It is highly unacceptable behaviour in the chamber and completely disrespectful to your fellow members.
Thank you, Madam Deputy Speaker. I know that the member for Kennedy would not intentionally try to disrupt my contribution to this debate, and I fully accept the apology that he has made. I know that he is aware of the fact that people do it hard and that, when they are doing it hard, they need the support of government.
I will end my contribution to the debate here by urging members of the opposition to rethink their position, stop saying no to everything and acknowledge the fact that people who are in receipt of the payments that have been outlined and will be covered by this new income support bonus really need support from government. The income support bonus is $1.1 billion over four years—a fraction of the cost that the opposition is promising to spend on their paid parental leave scheme and many other of the policies that are out there in the ether but are not properly costed and are without any details. I would encourage them to look at something that is very tangible and will provide support to a lot of people: to those who are single, to those who are in relationships—partners—and also to those young people who are training so that they can contribute to our Australian economy and society.
I rise in the House to speak on the Social Security and Other Legislation Amendment (Income Support Bonus) Bill 2012. The introduction of the supplementary allowance to be called the income support bonus was announced in the 2012-13 budget to help lower income Australians meet the cost of essential bills. The new income support bonus provides $210 a year to single recipients, $350 a year for most couples where both partners are eligible, and $420 in the case of eligible illness- and respite-separated couples.
Households that rely on Newstart allowance and similar payments as their main source of income do struggle when unexpected costs arise. These costs might include urgent repairs to household appliances or the family car, bills that are higher than expected, unforeseeable medical and dental costs, other emergencies, and general day-to-day expenses. The twice-yearly income support bonus is intended to assist recipients and their families by providing additional support to help them manage and be more resilient to unanticipated financial pressures.
The outlay over four years on the income support bonus is $1.1 billion. I know this support will be warmly welcomed in my electorate of Bass. The payment will be indexed to the consumer price index twice a year, starting in September 2013, and is tax free. Over one million eligible Australians can look forward to receiving their initial payment with their first income support payment after 20 March 2013. They will not have to apply to receive the income support bonus; the payment will be made automatically to those eligible.
The Gillard government understand that those on fixed incomes are doing it tough, and we are responding. The income support bonus will help disadvantaged Australians on income support to better manage the costs of unexpected living expenses, and this payment is another example of the Labor government looking after those most vulnerable and in the most need. Only Labor has a plan to help families with the cost of living and to build a stronger economy by spreading the benefits of the mining boom. Our economy is strong but it is not everyone's boom. Australians are worried about the cost of living—electricity, rent, school uniforms, groceries; even a simple family outing feels beyond the reach of many people. That is why Labor has put in place a package of measures to help people make ends meet.
We, the Gillard government, are looking after sections of our economy that need assistance. Families—for example, in my electorate of Bass—have been very appreciative of the schoolkids bonus, which has made this time of the year, usually very damaging to the family purse, much easier. Buying school uniforms, shoes, stationery, books and other back-to-school essentials was made a bit easier this year because of the Gillard Labor government. More than 6,900 families in my electorate have already received the January payment. Without doubt, those families will be worse off under a Liberal coalition government, because they have said that they will slash this payment. It is clear that opposition leader Mr Abbott and the Liberals do not support Australian families. Families in Bass certainly cannot trust those opposite. Job seekers and pensioners cannot trust them. The only people that will benefit from a Liberal coalition government are Gina Rinehart, Clive Palmer and the big end of town.
We are preparing Australia for the future and delivering on Labor values by investing in aged care, the National Disability Insurance Scheme, dental care, skills, and infrastructure such as the NBN, roads and ports. We have an outstanding record of significant achievement, secured in the most closely divided parliament in decades. Our economy is healthy and growing. It is the envy of the world's advanced economies. Yet, if one were to believe everything in the media, this is not the impression one would get. That is not to say that there are not many people struggling.
As a government we have made our choices. We stand for supporting working Australians with a package of policies that will help them get through, get working people a fair share of the resources boom and make the hard decisions that will build a new Australian economy and get us ready for the future. We are managing the economy for working people, and fighting for jobs—as we did during the global financial crisis.
Tasmania is a state at risk if those opposite win the 14 September poll. As a start, Tasmanian families would be stripped of their schoolkids bonus. This is in addition to the plans by the Liberals to slash the Household Assistance Package, which includes additional increases for family payments and tax cuts for workers on low and middle incomes. The Liberal Party's economic policies are a danger to the wellbeing of Tasmanian families and a threat to Tasmanian jobs and services. Whilst we, the Gillard Labor government, have doubled the investment in schools and education, upgraded facilities at every school and provided more information for parents than ever before, those opposite plan to slash and burn, just like Premier Campbell Newman has done in Queensland.
We, the Gillard Labor government, are delivering the skills and training required for the jobs of the future through the $3 billion jobs and skills package. An additional 150,000 students are now attending university. This is not an agenda that those opposite share. If they had their way, the only people to attend university would be those born into a family fortunate enough to be able to pay the up-front fees.
I ask those sitting opposite to come clean on their plans for Australian families—to tell the Australian people what their plans are and what assistance to the vulnerable they plan to take away to give to the big end of town. They now have no excuse, given the recent announcement of the election date by Prime Minister Gillard, to keep their policies and their detailed costings hidden from the Australian public.
There are no easy solutions to the challenges we face as a nation—just hard work and attention to detail. Real solutions require real policies and detailed costings. But we know that the shadow Treasurer has had many issues with costings in the past. It is an issue which has dogged him for quite some time. On 11 August 2011, leaked internal coalition documents showed that the Liberals would have to make $70 billion in budget cuts over four years to pay for their promises. The Liberals want to make savage cuts to services so they can give billions of dollars to some of Australia's biggest polluters. They also want to give back the mining tax to some of the world's most profitable mining companies—and in the process stop an increase in retirement savings for Australian workers. Cuts of $70 billion would be the equivalent of stopping family tax benefit payments for three years or cutting the age pension for two years.
Leadership is about more than glossy pamphlets. It is more than spin. It is more than being seen in all the right places in a fluoro jacket. The Leader of the Opposition has claimed that he wanted this year to be about positivity and policies. Given this, he needs to provide some answers to the Australian people about his plans for Australia. When will they reveal their workplace relations agenda? When will they tell us which tax cuts, pension increases and benefits they will scrap? When will they come clean on the scrapping of the schoolkids bonus and the household assistance package? These are things all Australians have the right to know before they cast their votes on September 14.
No wonder the former boss of the Leader of the Opposition had this to say:
Tony is genuinely innumerate. He has no interest in economics and no feel for it.
That was John Hewson in the Australian Financial Review on 24 May 2010. Those who know the Leader of the Opposition best know that he is out of his depth. That view is shared by Peter Costello, a former ministerial colleague of the opposition leader. Just recently, the Leader of the Opposition claimed that the coalition could fully duplicate Tasmania's Midland Highway for $400 million. That would maybe get you from Brighton to Kempton—
We will always manage the budget to support growth and jobs. We have a good record of managing the budget responsibly and in a balanced way, making savings while supporting growth and jobs. That makes our budget one of the strongest in the developed world and has allowed the Reserve Bank to repeatedly cut interest rates. We will continue to exercise spending restraint even though global factors, commodity prices and a high dollar have weighed more heavily on tax revenues than expected.
Australian families and pensioners are getting extra payments to help with their utility bills. Since July, we have given working families a tax cut so they get more money in their fortnightly pay cheques. Tripling the tax-free threshold has freed up to one million people from having to lodge a tax return. These people will not pay any tax out of their take-home pay.
The world is changing and Australia faces many challenges and big opportunities in the years ahead—an ageing population, increased global competition, environmental degradation, keeping the economy strong beyond the mining boom, the future of manufacturing, rapidly developing new technologies and the Asian century. To meet these challenges, Labor is pursuing the policies Australia needs for the future—putting a price on carbon, building the NBN, sharing the benefits of the mining boom, increasing retirement savings through superannuation reforms and making the aged-care system fairer and more sustainable.
We stand for jobs. We stand up for working families. We represent the people who have little or no voice. These are the values I hold as a member of the Australian Labor Party. That is how I go about making decisions. Improving living standards for this and future generations of Australians means making the right decisions now so Australia can continue to be a winner in this Asian century.
We, the Gillard Labor government, believe that the benefits and dignity of work should be extended to more Australians. Our economy needs more workers and many Australians need work. We have seen more than 800,000 jobs created since our election, but more than 200,000 Australians are not working when they could be. We believe that individuals need to take more responsibility for themselves and that those who can work should work. It is not fair to ask taxpayers to help pay the way of people who should be able to support themselves. To end the cycle of successive generations of families being left to languish on welfare, strong requirements will ensure that opportunities for training and work experience are taken. New incentives mean people can keep more as they earn. I look forward to the Gillard Labor government continuing its good work in this area. I am pleased that many residents in my electorate of Bass will be the recipients of this new payment.
I know we are making the right decisions. We know where we are heading as a government, and I implore the Australian public to hold those opposite to account and to find out exactly what their plans are.
The gap between rich and poor is growing under this government—a fact that even some of its ministers have acknowledged. At one end of the spectrum we have the mining companies who have the wherewithal to spend $26 million on an advertising campaign and thereby get themselves out of paying $100 billion in taxes over the next decade; we have the big banks that are some of the most profitable in the world and that now, in the coming reporting season, are looking at potentially paying an extra unexpected dividend because it looks like they are going to be making so much more money than they expected—and that is on the back of significant public support, including the support we gave them during the global financial crisis; and we have millionaires, people in this country who earn over $1 million, paying the same marginal rate of tax as someone who earns $150,000 or $200,000.
At the other end of the spectrum we have people who are doing it tough, who may have lost their job through no fault of their own and who are forced to live on Newstart. Those people are living below the poverty line. They are $130 a week below the poverty line. It is not just the Greens who have been saying for some time that this is an untenable way to live; the Australian Council of Social Service and welfare groups have been saying that Newstart has not kept pace with the rising cost of living, and also the head of the Business Council of Australia has said that the level of Newstart is now so low that it is a barrier to people getting into jobs. When you have the Business Council of Australia and the Greens and ACOSS all saying Newstart is too low, then something is wrong in this country.
The order of magnitude we are talking about is $130 below the poverty line, and what is this government's response? This government's response is to boost the benefit by, on average, $4 a week. That is what the Social Security and Other Legislation Amendment (Income Support Bonus) Bill does. This $4 a week will not lift one single person out of poverty. The amount of money that is Newstart does not go very far, as I found out recently, when I tried to live on it for a week. Once you deduct from your $246 the cost of putting a roof over your head there is not much left, even accounting for rent assistance. In a place like Melbourne, that rent would be $180 a week. During the course of last week I spoke to someone who is homeless. He went to a housing service, and they found him a single bedroom in a rooming house in inner-city Melbourne. That single bedroom in a rooming house cost between $180 and $220 a week. That is what people are paying now. I spoke to a single parent today—I will talk a bit more about this in a moment—who said that for the only place she could find that was big enough to house her and her children she is paying $450 a week rent. It does not take much mental arithmetic to work out that, when you start with $246 and then you take out $180, you are not left with a lot to live on for the rest of the week.
What we find around this country is that about two or three days into the week, people on Newstart have spent all their money and that everything else after that is either debt or they rely on family and friends or they go without. People on Newstart are routinely skipping meals because they have no money available to feed themselves. I visited one welfare service in my electorate, St Mary's House of Welcome, that does free or $2 lunches every day for people who live in the area, including many who live in the housing commission flats. If my recollection is right, they told me that in the order of 40 per cent of the people coming through the door are on Newstart—and they are coming in two or three times a week. In other words, Newstart is not even enough to feed yourself on, and the government is outsourcing to charities the obligation of finding enough money for those in our society who are doing it too tough to feed themselves.
These charities and services do a fantastic job, and they do it on the strength of donations and volunteer labour. But people should not have to rely on charity to feed themselves when they are unemployed. The level of government assistance should be enough to at least pay for a decent meal each week. We have not even got into paying for car registration, if they are lucky enough to have a car, or paying for things that might help them get a job—getting a haircut, buying some new clothes, getting training. All of this means that when people find themselves on Newstart they are in a cycle where they are going further and further into debt; they are not getting closer and closer to a job. Things become tougher and tougher and tougher.
My small experiment last week was just a simple taste. I was on the dole for a while about 20 years ago, when I finished university and was looking for my first job. It took me the best part of a year to find a full-time job. It was not the most salubrious of existences, but I remember being able to share a house with some other people, that we ate well and that I had enough to buy a suit and go and find a job. You cannot do that now. If any one of us or anyone who is listening found their job gone tomorrow through restructuring, through no fault of their own, they would expect that the income that they went onto would not be as high as they received in their job and probably would not even be as high as the average weekly wage but would be enough to hold them up until they were able to stand on their own two feet.
We are finding that the safety net is not supporting people when they find themselves in times of trouble; it is strangling them. It is making it impossible to live. Three reports have told the government this.
So what does the government do when given a chance to fix it? It increases Newstart by $4 a week. Of course we are going to support this legislation, because $4 is better than nothing, but $4 is almost an insult.
What is even more insulting, knowing how low the payment is, is that, in order to achieve the now abandoned goal of reaching an early—political—budget surplus, Labor decided to abolish the great Labor legacy of the single parents pension and kick tens of thousands of parents off their benefits and onto the dole on 1 January this year. This has plunged tens of thousands of children around this country into poverty. The extra amount that you get on the dole when you are a single parent is minimal.
Even worse, the government tried to dress up this naked cash-grab as a move to get people into work. When you scratch the surface of that, you understand that the single parents who have been hit hardest by this move are the ones who have been working. They are the ones who are working 15 or 20 hours a week to make ends meet, and that is because under the single parent payment you were allowed to earn a lot more before you started losing your income. But under Newstart you can earn only $30 a week. That means that, as of 1 January, because this government did not have the courage to stand up to the mining industry and pass a proper mining tax and therefore needed some money to try to balance the budget, there are now single parents who are trying to raise their kids and work at the same time who are up to $140 a week worse off. They have lost $140 a week. That is potentially a third of their whole income.
This is having massive flow-on effects. We are seeing people going further into debt—further into hock. Last week I spoke to Catherine, who is a single mum. She has gone back and trained as a graphic designer. She needs her computer as the tool of her trade. Because she is now on Newstart and because the new school year has come around, she had to put her computer in hock to get $200 to buy the schoolbooks. How is it helping someone to find work when they have to put the tools of their trade in hock?
The worst thing is that the people who are suffering the most from this are the kids, because they are now unable to do what their peers are doing. I have had parents tell me that, because they do not get the same income—or, potentially, because they lose Newstart altogether and therefore lose all the benefits, such as the concession card that helps with the rego and the bills—they are now having to make choices like, 'Do I pay the car rego or do I pay for the school camp?' What is even more heart-breaking is when they tell you, as they have told me, that the kids have now stopped bringing them the permission slips for a camp or an excursion because they know it upsets mum and makes mum cry. That is happening now because Labor has not had the courage to raise the money we need to fund the services and payments that most Australians expect.
This is about values and it is about the kind of society we want to live in. It is about how we treat those who have fallen on tough times—how we treat the hardest working families in this country, the single parents who are balancing work and looking after their kids with no-one else to help them, quite often unable to pay childcare fees and the like. It is about how we treat them. Do we want to become a more caring society, where we use some of the wealth of this country to look after those who have fallen on hard times and who could be any one of us if we found ourselves unemployed and in need of assistance, or are we going to attack them and keep them living below the poverty line because it is easier to target and pick on them than to ask Gina Rinehart to pay one cent of mining tax? That is what this boils down to.
It was very generous and magnanimous of the government to bump up Newstart by the equivalent of $4 a week! It probably will make a bit of a difference to some people, and they will use that money and they will be very grateful for it. It might help them start to get out of debt. It might help them pay the rego. It might mean that they do not have to put the computer in hock, because they can pay the school fees. But it is almost an insult that, after being told several times that the level of income support in this country is below the poverty line, we are now keeping people there.
We have a choice. Do we want to become a more caring society, where we look after people who have fallen on hard times, or are we going to go down the path where society becomes more dog-eat-dog and we do not care about people who fall through the cracks? That is the direction in which we are going. Until we have the courage to stand up to big business and raise the money that this country needs to fund the services and payments we expect, we are going to see more of these cuts.
I congratulate the Assistant Treasurer on his excellent contribution, but I would not hold my breath expecting any change from this particular parliament or the new parliament next year.
This is a very wealthy country. In fact, from where I sit, it should be one of the wealthiest countries on earth. I stand in a unique position because, when Premier Bjelke-Petersen was going to Canberra, Bill Gunn and I were effectively running the state of Queensland. We lost government as a result of the Fitzgerald inquiry—and, I might add, we only very narrowly lost government, with only a single minister ever convicted for corruption; some of them were convicted of misusing their ministerial allowances, an entirely different issue. But I saw the great wealth that you can create very quickly in this country.
For the last 10 years I was in the cabinet room, every year that government saw a $200 million tourist development, every year we saw a new mining town open up and every year we saw a new major irrigation dam built. In the 22 years since that government fell, to my knowledge there has not been a single new mining town built in Queensland, there has not been a single $200-plus million tourist resort built and there has not been a single dam built—not one of those items. So those great wealth creators that were leaping into Queensland every year have been destroyed. Why have they been destroyed? Because every time a person wants to do a development, the greenie elements of the Liberal Party or the greenie elements of the Labor Party think of 4,000 reasons that the development cannot go ahead. Eventually the developer just rolls his swag and walks away. That is what has happened again and again in Queensland. So there is no money in the till; there is no tax revenue base to provide the services.
When I was preparing this speech, I was really quite amazed when I added this up—if you are a pensioner couple on $35,00 a year, wipe out an extra $2,000 for insurance. That is how much insurance has gone up in the last 12 months or two years, and that is because the state government insurance offices were flogged off by the ALP and the LNP governments. They sold our state government insurance offices. So now the big corporations that own the insurance companies can charge whatever they like. There is no benchmark that we can apply to bring them into line. The SGIO was not there as a socialist endeavour; it was there as a benchmark—a policeman to keep the insurance companies honest. If you take the policemen away, you will be charged whatever the oligopolistic corporations want to charge you.
When I went to university I was taught that if you had a monopoly, then there was no free market determination of pricing, that if you had a oligopoly there was no free market determination of pricing and that that means few buyers and/or sellers in the market. I was also taught that a competitive market is defined as an unlimited number of buyers and sellers. So, if you wanted a proper determination of price, you had to have an infinite number of buyers and an infinite number of sellers. Where we have just three electricity generators—I would say pretty soon it will become two generators in Australia—they can charge whatever they like. It is rather interesting—they put electricity charges up 10 per cent every year.
Mr Deputy Speaker, I am talking about our retirees. They have been hit with an extra $2,000 for insurance, they have been hit with an extra $3,000 for electricity, they have been hit with an extra $1,000 a year in rates, they have been hit with an extra $1,000 a year because of the current Labor government's reductions in the subsidy for prescriptions and they have been hit with an extra $2,000 a year on average for dental care because, if you have toothache in Queensland, the waiting list is over two years, so if you have to go to the dentist you have to pay whatever the dentist charges you. If you add those figures up I do not know what it comes to, but I would say it is in excess of $10,000. So it was $35,000 prior to the marvels and wonders of the free market system perpetrated upon us by Mr Keating and his successor in crime, Mr Costello, and we have taken $10,000 from these poor people. Mr Deputy Speaker, I do not want you to get upset because we are giving them $350 back! Through our incompetence we took $10,000 a year off them, but now we are going to very generously give them $350 back, just before the election.
Please excuse the people of Australia for being cynical. Please excuse the people of Australia for loathing and detesting politicians. When I say we are a great and wealthy country, I bear in mind that half of our electricity production in Queensland came from the Gladstone power station and that the power station was fuelled with free coal because we kept some of that coal for the people of Queensland. The Liberal federal government and the Labor federal government gave all of our gas away and reserved no gas for the Australian people. They have reserved no coal for the Australian people. They have let that gas go for nothing—and I fought against giving away the coal seam gas. There should be money in the till to pay for these pensions. There should be money in the till to increase the pension, not give them a meagre $350. Good on the government for giving $350 to retired couples, but I am saying that this should be a wealthy country.
You deregulated the wool industry and destroyed it, so you had no money coming in from there. You let the gas go, to be sold to foreigners for nothing, so you have no money coming in from the gas industry. We are the only country on earth that refuses to introduce an ethanol industry. In the last three months, China has announced ethanol, the United Kingdom has announced ethanol, Japan has announced ethanol and India has announced ethanol. That leaves ours as the only significant economy on earth now that does not have ethanol. All the European countries already have ethanol.
All of the Americas already have ethanol. The United States is the biggest producer of ethanol in the world, and, within five years, the United States will not be sending any money to the Middle East at all; they will be entirely self-sufficient. There is $20,000 million that should be staying in Australia. It should be yielding for this government or any future government—state, federal and local—some $7,000 million a year in tax revenue. But that $7,000 million a year is not there because you do not have an ethanol industry. You are buying your oil from the Middle East. You are sending our money overseas.
There is a massive importation of food into this country. Last time I looked, we spent $10,000 million a year on importing food, representing almost one-third of our food requirements. We are now buying almost all of our motor cars from overseas. That industry was generating $2,000 or $3,000 million in taxation, which should have been going to retirees. All of this money should be there. The destruction of manufacturing has cost Australia $20,000 million in tax revenue.
Mr Deputy Speaker, in your own state, where we should not be importing timber—
Order! I ask the honourable member to return to the bill. The name of the bill is the Social Security and Other Legislation Amendment (Income Support Bonus) Bill 2012. I ask the honourable member, in his remaining five minutes, to address that bill.
Mr Deputy Speaker, I do not wish to in any way impugn your judgement, but clearly in my mind if we do not have the money to give these people then all we can do is give them a meagre $350. If this country were enjoying the great wealth that we should be enjoying, we would have that money.
Let me be very specific now and talk about young couples. Before the time of Mr Keating and this free market rubbish we had a fair tax system. I remember as a young man having three kids and one income. My wife, with three kids, really had to stay at home. I paid virtually no tax at all because there were big tax deductions for those kids. Today Australia has one of the lowest birth rates in the world. In 10 or 12 years time there will be more deaths than births in this country. We are a vanishing race. A husband and wife with three kids on one income are going to get $350 as a result of this bill. After having $15,000 taken out in tax, they are left with $55,000 a year. Then they have accommodation expenses, which are roughly $18,000, on average, in Australia. So, after tax and accommodation, that family of five is left with $37,000. That works out to $7,000 per person. I would like to see you raise a child on $7,000 a year. Is it any wonder that young people—those that can add up—are saying, 'I can't afford to have a kid'? They can't. It is impossible. A double income, no kids couple earning $140,000—two people on $70,000—pays about $35,000 in tax. That leaves them with $105,000. Taking out accommodation expenses, again, of $18,000 leaves them with $87,000, which is $43,000 per person. The question is: is this a fair system? We give families $350 and expect them to live on $7,000 per person, but we let the DINKs live on $43,000 per person.
I look back with great joy at my family's association with the Labor movement, which delivered a fair system to Australia under which young, struggling families, such as my own at the time, paid virtually no tax. When I was a single man working at the mines in Mount Isa, I paid a fair whack of tax—and so I should have, because I was on huge money. But that is not the fairness of the system now. The fairness of the system now is that young families are crucified in this country. Giving them $350 is not going to solve their problem when they have to try to keep a child alive on $7,000 a year. That will be good fun; that will be certainly a challenge.
God gave us a really wonderful country with very great riches. We are endowed with an ability to produce all of our petrol from ethanol. We are endowed with a country where we could produce all of our petrol from our gas supplies. We are endowed with a country that has coal and iron ore in an abundance that probably no other country on earth has. We have a country that was producing 15 per cent of our entire export earnings from wool when we were intelligently and aggressively marketing that product. We were a country that could feed itself. We were a country that built motor cars. None of those things are true now, and everybody in this parliament knows they are not true. They will not be true unless you make fundamental changes in policy and go back to having the aggressive, highly competitive economy that we once had, not apologising or bowing and scraping and trying to pretend to the rest of the world that we are the great free marketeers—that we are so fair-minded. We are bloody fools for being looked at that way by the rest of the world, and our young people are paying the penalty. (Time expired)
I rise to speak on the Social Security and Other Legislation Amendment (Income Support Bonus) Bill, the purpose of which is to provide two extra cash payments to certain income support recipients. As you would be aware, this bill comes out of a package which the Prime Minister announced with much fanfare last May called Spreading the Benefits of the Boom. The coalition is going to oppose this bill. In the time that I have available this evening, I will outline the reasons that we are going to oppose it.
There are three arguments that I will make as to why we are opposing this bill. Firstly, there is no money to pay for it. This bill asks us to appropriate over $1 billion and put it on the government credit card. Secondly, the stated purpose of this bill, which is to support families with cost-of-living pressures, should be achieved in other ways, notably by scrapping the carbon tax and reducing other taxes. Finally, before we start handing out cash-splashes, the government should restore the funding to hospitals in Victoria. The funding cuts are causing beds to close, including in my electorate.
I go to the first point of no funding being available to pay for this package of measures. When this package was announced, it was said that it was going to be paid for by the mining tax. It was a case of 'spreading the benefits of the boom', as the Prime Minister's statement itself said. If you read her statement, it says very specifically that this package will be funded by redirecting minerals resource rent tax revenue intended for the company tax cuts. But, of course, we know what occurred: no revenue came in from the minerals resource rent tax. But, when the government realised the fact that no revenue was coming in from the mining tax, they did not look at the spending connected to the mining tax and think, 'We'd better examine that and cut back on the spending connected to the tax.' No, on the contrary, in the typical Labor way, they just did the spending in any case. What does this mean? In essence, it means that this bill asks the parliament to appropriate $1.07 billion and add it to government debt. We are already in billions of dollars of debt.
So far the government have racked up $147 billion in net debt. They have delivered the four biggest government deficits in Australian political history. The government, despite promising 500 times that they would deliver a surplus, they have since abandoned their promise. So now, I presume, they think: 'We've abandoned any sense of financial responsibility. We've abandoned any sense of trying to get back to a surplus. What does an additional billion dollars on the government credit card mean, in any case?' I presume that that is the thinking of the government in relation to this bill and many other spending commitments they are making with no revenue connected to them. This stands in stark contrast, of course, to the period of the Howard government.
Under the Howard government, there were payments made to families to help with cost-of-living pressures. But guess what? Under the Howard government we had budget surpluses, so they were affordable expenditures and affordable payments. Now we are not in a surplus. We are in deep deficit, with huge debts, and this bill just adds an additional $1 billion to the government's credit card. This is the first reason that we are opposing the bill—the government simply cannot afford it.
The second reason is that there are better and more sustainable ways of meeting the intent of the bill. Again, if I go back to the Prime Minister's statement in relation to the measures contained in this bill, it said that these cash payments will help with cost-of-living pressures. I have no problem with the intent to help families with cost-of-living pressures. Indeed, it will be one of the central goals and central themes which the coalition will prosecute up until the election and, should we be elected, it will be one of our central platforms to address. We know that many families are doing it exceptionally tough at the moment; we know that because we are out there speaking to families on a daily and weekly basis and because they tell us how difficult it is. They tell us that all the essential goods in life are going up way in excess of inflation and way in excess of their salaries. When you actually look at the statistics, you see that they bear this out. For example, if you look at electricity costs, you see that they have gone up by an amazing 90 per cent since the Rudd-Gillard government was elected in 2007. Water has gone up by 64 per cent; gas, 60 per cent; education, 31 per cent; and medical and hospital services, 38 per cent. Child care has gone up by 15 per cent in the last year alone. So the cost of living is absolutely an issue. Many families are struggling.
What has caused these cost-of-living pressures? It is important to ask that question because we need to get to the bottom of it to determine what the best mechanism is to try to support families with their cost-of-living pressures. When you go through some of the increases in prices you see that it is the government's own policy positions, their own taxes and their own regulations that have caused many of these cost-of-living pressures. We know about the electricity price increases, where electricity has gone up by 10 per cent alone this year. It was forecast to go up by exactly that amount due to the carbon tax. The government knew that that would occur and they went ahead and did it—so they are responsible. Their tax is responsible for a 10 per cent increase in electricity this year, and this is when the tax is at $23 per tonne. The government want the tax to go up to $350 per tonne by 2050. Gas has gone up by nine per cent, which is also due to the carbon tax.
Health costs have gone up because the government are taking the axe to the private health insurance rebate. It was predicted that, if you take the axe to the private health insurance rebate, the private health insurance rebate will go up for everybody. It adds to cost-of-living pressures. Child care has gone up at a dramatic rate in the last 12 months due to a government policy which is deliberately causing prices to escalate. The Productivity Commission examined the government's proposals in this area and said, 'Yes, you proceed with those policies and costs will go up by 15 per cent.' So what did the government do? They proceeded with those policies. And what have we seen? We have seen costs go up by 15 per cent. The government have introduced 21 new taxes. Generally, of course, the government have added thousands and thousands of new regulations which make it more difficult and more expensive for businesses to operate, and all of that translates to higher costs for goods and higher costs for services for everyday Australians.
And so it is that the government itself has been one of the main drivers of the increases in costs of living for Australian families. Having put up costs for families, the government is now saying: 'Geez, the costs have gone up for families. We'd better give them a cash payment to make up for those costs.' That is the wrong way to think about it. Instead, we should actually be thinking, 'What can we do to take the pressure off the cost side of the equation?'
There are many things which this government should be doing immediately to take costs off families. It starts with getting rid of the world's largest carbon tax. That tax alone adds $515 per annum to the family's budget. This measure is only $210 per annum. So, if the government is concerned about cost-of-living pressures, it could get rid of the carbon tax. That is the first thing that you can do. Minimise the other taxes—that is the second thing that the government can do. Re-examine those 21 taxes which it has introduced and minimise them where possible. Third, stop cutting the private health insurance rebate, because that directly increases the cost of private health insurance. Fourth, do not make child care more expensive to operate. If you make child care more expensive for operators then that means prices go up for everyday families. Fifth, cut the regulations off business. Get rid of the red tape and let businesses be more productive and efficient, because that means they can then pass on their lower costs into lower prices for everyday families. These are the things that would have a demonstrable impact on cost-of-living pressures. That is what should be the focus of the government, rather than putting up costs with its policies and then finding that it has to give a cash splash because people have higher cost-of-living pressures. That is the wrong way to go about it.
My final argument as to why I think this bill is not the right one at this time is that the government has got its priorities wrong. We know that it is wasting money in many areas, but it is also at exactly the same time cutting money from core essential services in the community. I am particularly concerned about the $107 million which this government has cut from Victorian hospitals. That is having an impact right across hospitals—
Mr Deputy Speaker Adams, on a point of order: funding to Victorian hospitals goes up every year under this government. It is more this year than it was last year, and it will be the next year, and it is irrelevant.
Thank you, Mr Deputy Speaker. I am speaking to the bill. I have outlined three reasons why I am opposed to the bill, and I am getting to my third point. The third point is around priorities of expenditure. This is a $1 billion expenditure that we are talking about here with this bill. Meanwhile, the government has cut $107 million from Victorian hospitals. Do you know what that means, even in my electorate? It means that five palliative care beds in Wantirna Health in my electorate alone have now been closed. It also means that in the adjacent electorate, the electorate of La Trobe, five surgical beds have been closed from Angliss Hospital.
When it comes to priorities, they are the types of things that should be done in terms of restoring those cuts which are having a detrimental impact right across my state, including for my constituents in my electorate.
If I could summarise, in conclusion, in the last minute I have available: we all want to be generous for families which are doing it tough. We particularly feel for those who are doing it tough. But if the budget is in serious deficit, as it is now, if there is an enormous government debt, which there is now, then we cannot afford the cash splashes which this bill proposes. What we can do, though, is make a real impact on cost-of-living pressures by cutting the taxes, by cutting the red tape, and by having sensible policies to keep costs down. Those should be the government's priorities.
Nothing is more important to a Labor government than creating good jobs and fair workplaces. We understand that having a job is the best way to deal with cost-of-living pressures. Work is the key. Long-term unemployment, intergenerational joblessness and welfare dependency are not just tough; they are a waste of human potential. Labor is the party of work. It is in our DNA. We are also the party who will speak up for the disempowered, the marginalised, the discriminated against and the disadvantaged. That is why, in government, I believe that some of our greatest milestones are the public policy achievements which place a strong safety net under Australian society while helping create the circumstances for as many citizens as possible across the community to rise to high levels of comfort and security. We have always judged ourselves, in part, by how we help the most downtrodden and disadvantaged in our community.
So I am proud to conclude debate on the Social Security and Other Legislation Amendment (Income Support Bonus) Bill 2012 tonight. The bill includes amendments to the Social Security Act 1991, the Social Security (Administration) Act 1999, the Farm Household Support Act 1992 and the Income Tax Assessment Act 1997 to give effect to this commitment.
This bill will give effect to this government's 2012-13 budget commitment to introduce a new supplementary allowance for eligible income support recipients. In practical terms, this measure will help around 1.4 million Australians to manage unanticipated expenses by providing an additional $210 a year to single recipients and $350 a year to most couples where both partners are eligible. These payments are being made because we know that households reliant on income support benefits as their main source of income can find it hard to manage unexpected costs, such as urgent repairs on the family car or appliances, bills that are higher than expected or unforeseeable medical or dental costs.
These payments underline the government's $1.1 billion commitment over the next four years to support eligible welfare recipients. This includes Newstart allowance, youth allowance, parenting payment, Austudy, ABSTUDY, living away from home allowance, sickness allowance, exceptional circumstances relief payment, transitional farm family payment and special benefit. The income support bonus will also be tax free and indexed twice yearly in line with the consumer price index, making sure the payment keeps pace with the real costs recipients face. We understand that it is very tough to live on unemployment benefits, including but not only the Newstart allowance.
Eligible Australians, defined as those receiving a qualifying income support payment on 20 March 2013, can look forward to receiving their initial payment as part of their first income support payment after this date. They will not have to apply to receive the income support bonus; the payment will be automatically made to those eligible people. Income support bonus payments will then be made in March and September every year, provided the recipient is on a qualifying income support payment on 20 March or 20 September for the respective payment.
For single recipients, the payment will be $105 for the initial payment or $210 a year. The payment to most persons who are a member of a couple will be $87.50 in the first payment or $175 a year. As is the case with other supplements, each entitled member of a couple separated by illness, with a partner in respite care or with a partner in jail will be paid at the single rate of $105. The bonus is not separately means tested, because income and assets tests already apply to the person's qualifying income support payment, but will be subject to the existing income management provisions.
The government also welcomes today the report of the Senate Education, Employment and Workplace Relations References Committee on the adequacy of the allowance payment system. We will be carefully and seriously considering the report recommendations. I am indebted to the work of the senators and also those who have made contributions to this report. The Gillard government has acknowledged on a number of occasions that it is not easy for a person to live on the current rate of the Newstart allowance and that many in our community are doing it tough. Combined with related measures, such as the doubling of the liquid assets waiting period thresholds, the income support bonus will assist vulnerable members of our society, including those on the Newstart allowance, to manage unforeseen expenses and increasing costs.
The income support bonus offers assistance to disadvantaged Australians whilst being framed against a background of fiscal prudence, given the tough budgetary considerations of the government and our ongoing priority on jobs. Indeed, the income support bonus is fully accounted for in MYEFO as part of the budget process. It will again be accounted for in the budget bottom line. Today, the real story which gets overlooked by those opposite is that it was the unholy coalition of the conservatives and the Greens opposing a reduction in the corporate tax rate that in fact allowed us to spend some of that money on the income support bonus. We believe fundamentally in spreading the benefits of the boom.
The consequence, if this bill is successfully passed tonight, is that over one million Australians are set to benefit from $1.1 billion in extra income support to cope with cost-of-living pressures. We hope to pass this bill tonight despite the opposition's constant negativity. We are disappointed that they will vote against this modest extra support. I would again beseech the opposition: this battlers' bonus will deliver more than $1.1 billion in extra payments over the next four years to help people receiving income support cope with those unexpected cost-of-living expenses. The Gillard government recognises that people who rely on income support benefits as their main source of income can find it very tough to manage those unexpected costs. As I said earlier, there are always things which are difficult to plan for—such is life—such as: urgent repairs on the family car or essential appliances; those unexpected, but necessary, medical expenses; or indeed the bills which come in. I am disappointed that the opposition will not support these one million low-paid Australians, who are worthy of additional support.
As I have said, those eligible will not have to apply to receive the income support bonus, as the payment will be made automatically by the Department of Human Services. In conclusion, our first priority is to help create and maintain fair jobs for all Australians who are willing to work, but this income support bonus will help us get the balance right. We believe fundamentally in helping disadvantaged Australians while doing everything that we can to move people back into paid work. That is why we are putting significant resources into vocational training to assist people, into job agencies to help place people in work, into helping Indigenous Australians in remote communities find work and be work ready and into helping people with disabilities, who are a group that have been neglected in the labour market for a very long time.
This income support bonus is a further effort to strengthen our safety net to maintain this country's position as the most just society on earth. The coalition's decision to vote against this important legislation, if that is what they do, unfortunately comes on the back of the Leader of the Opposition telling the National Press Club last week that he plans to increase superannuation taxes by up to $500 on 3.6 million low-paid Australians who earn less than $37,000 a year and who include 2.1 million working women.
Tonight we will see a new land speed record set, with one party in Australian politics voting twice in one day not to support people who are low paid, with low incomes. We hear them repudiate low-income superannuation concessions, where we have abolished the tax paid by 3.6 million Australians on their superannuation contributions—people who earn less than $37,000—and tonight we see the opposition opposing modest support getting the balance right for one million-plus Australians who require this assistance in their time of need.
I am afraid it is becoming increasingly clear that one of the dividing lines in the upcoming election this year, as reflected by the coalition's treatment of this bill, is that, when it comes to helping the low paid, when it comes to helping people on allowances, when it comes to helping people who have very modest incomes, the opposition have read the Mitt Romney game book, have watched the Mitt Romney videos and are not supporting the low paid; instead, they would hand money back to the mining companies. They do not support people on low incomes. They have low-paid Australians in their sights.
I thank members for their contributions, even if I did not agree with those of the opposition. I commend the bill to the House.