Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

I speak in support of the Family Assistance and Other Legislation Amendment Bill 2013. The purpose of this bill is to make changes in relation to the baby bonus. It comes as a result of what we announced in the 2012-13 Mid-Year Economic and Fiscal Outlook. The amendments will change the support not for new parents but for second and third children and beyond. We are maintaining support for new parents with their up-front costs with the baby bonus. From 1 July 2013, the Baby bonus for second and subsequent children will be reduced to $3,000. The baby bonus will continue to be paid at the current rate of $5,000 for a first child.

I have two children—they were born a long time ago—but I daresay most of the people in this chamber would have had children. The reality is that your first child incurs the most cost with all the things you need for maintaining a child—whether it is a pram or a nursery. A child changes not just the time, energy and lifestyle of parents, but it changes their finances as well. We are maintaining that support for the up-front costs for the first child or a multiple birth—twins, triplets, etcetera—but in relation to subsequent children—where they may, for example, have the pram or have the nursery or the beds set up—in those circumstances we are making changes. This will provide savings of between $500 million and $600 million over four years.

There are many things that we have done to improve the life and lifestyle of Australian families and I will come to those shortly. We are ensuring eligibility for the family tax benefit until the end of a calendar year for young people who complete secondary study or its equivalent in either November or December of that year. Additionally, the bill provides the qualification for a double-orphan pension being extended so that it aligns with eligibility for family tax benefit. There is a huge amount I could say about what this government has provided to Australian families and particularly those in my electorate. One of the things I am most proud of is helping dads take time off to spend with their babies. That is a tremendous thing that we have done from 1 January this year—putting that as an option, for their babies to have the best start in life and ensure that the mother is supported by the father of that child. To the tune of about $600 a week before tax at the minimum rate for two weeks, it allows the parents to establish patterns in life, which my generation never experienced. I think that is particularly important. There are, of course, tests in relation to that, but the vast majority of people in my electorate will benefit from that change and have already done so.

Talking to young families in shopping centres like Yamanto Village, Winston Glades, Brassall or River link about those issues—and I have spoken to many, many people—this particular reform is one of the most important changes the federal Labor government has made. The paid parental leave scheme that we have brought in has seen literally thousands of people in my electorate given the option of not using the baby bonus. More than 160,000 people have taken up this option. It is another initiative of this federal Labor government—a first for our country. The other assistance that has been commented on locally is the schoolkids bonus—that baby becomes a child very quickly and a school kid very quickly. They grow up so quickly—from toddler to pre-school to school. I remember talking very recently at Raceview State Primary School to young mothers, often with young babies in their arms, about the schoolkids bonus. It is another great initiative that this government has brought in—$410 per child at primary school and $820 for high school. We have seen the benefit of that. We on this side understand helping young families who have young children who at that stage often have the highest rate of mortgage or rent and the most stress they will ever have—helping them with the dads and partners bonus or the schoolkids bonus or paid parental leave.

All these things make a huge difference to their lives. That is why I just cannot understand the attitude of those opposite to the schoolkids bonus. Having supported an education tax refund, they are now opposed to a schoolkids bonus. In my electorate some families will lose $15,000 during the time their kids are at school. I just can't understand that the young mother I spoke to outside Raceview State Primary School, who sends her kids there and then on to Bremer State High School, will lose $15,000 if the Leader of the Opposition gets into government. We have seen $588 million injected into the economy through the schoolkids bonus and it has helped 16,100 local families. We should be providing help for families. That is what this government is doing—helping young families in particular. We have high growth, low unemployment, low inflation, a strong economy and low interest rates. Those young families with kids at primary school are the ones who are now paying on average much less in interest rates than under the coalition government. Interest rates rose ten times in a row under John Howard and the coalition and now under this government they are so much lower. That is because of the prudence of this Labor government's management of the economy. It is managing the economy in the best interests of the country and in the best interests of families.

This amendment will save money, but it has to be seen in the context of all the other things we have done—dad and partner pay; paid parental leave; the schoolkids bonus; the tax cuts for that mother who might be working part time; raising the tax-free threshold from $6,000 to $18,200 and, in the next year so, to $19,400—to be clawed back by the coalition if they get into power—the family tax benefit rises; and the pension rises. I was talking to a fellow last Saturday at Winston Glades shopping centre at Yamanto. The guy was on an age pension—getting the benefit of our increases to the age pension—and he had a couple of kids and a wife from Indonesia. He told me that they were getting the benefit of so many of our reform—the schoolkids bonus, for example. He was horrified when he found out that the coalition would take that away from him, that they would take away his pension rises and his schoolkids bonus—so many of the things which help his young family and help him to support his two kids, who are both at Raceview State Primary School.

What we are doing in this legislation must be seen in the context of everything we are doing—that is, providing help for families; making sure they get a decent lifestyle; making sure they have a roof over their head; ensuring their kids are educated to enable them to achieve their full potential; ensuring their financial security through low interest rates; making sure they have money in their pocket to pay for that computer, those sports shoes or those music lessons; and giving them just a little bit of a helping hand with the cost of living. This government is committed to that. I say to the electors in my electorate of Blair: whether you are sending your kids to Raceview Primary, to Silkstone State School, to Redbank Plains State School at Redbank Plains, to Milford Street Kindergarten or wherever, we will be there for you. Whether your child is born at St Andrew's Hospital or Ipswich General Hospital, we will be there for you. This government has provided; those opposite will not.

Kevin Andrews (Menzies, Liberal Party, Shadow Minister for Families, Housing and Human Services) Share this | Link to this | Hansard source

The Family Assistance and Other Legislation Amendment Bill 2013 is a bill from a Labor government which has not only lost its way but has lost what were once bipartisan values of supporting families and helping parents. The honourable member for Blair, who preceded me in this debate, made constant reference to the education bonus as if it were something completely new. What the government did was replace an old tax rebate with the education bonus. Most people who are in receipt of that bonus would have been in receipt of the rebate under the former system.

The coalition does not support this government's continuing attack on families through this bill. The coalition will always stand up for Australian families. What this bill seeks to do is to bury a change to the baby bonus in a range of other measures. I will concentrate on the most significant part of this proposed legislation, namely the changes to the baby bonus. This bill seeks to implement Labor's change to the baby bonus, a change announced in the 2012-13 Mid-year Economic and Fiscal Outlook. The amount of the baby bonus for second and subsequent children who come into a family from 1 July this year will be reduced under this bill to $3,000. This change will apply generally, regardless of whether the child is born into the family, adopted by the family or entrusted to the family's care within 26 weeks of birth—under, for example, a foster care arrangement. The baby bonus will continue to be paid at the rate of $5,000 for the family's first child and for each child who comes into the family in a multiple birth, adoption or entrustment-to-care situation.

Let us put this into context. The baby bonus was introduced by the coalition in 2002 for the purpose of raising Australia's declining fertility rate. This policy was a direct result of the intergenerational reports instigated by Peter Costello when he was Treasurer. What those Intergenerational reports pointed out was that, for the continuing economic growth of this nation, we had to concentrate on three things—population, participation and productivity.

Labor has repeatedly slashed the baby bonus in an attempt to find savings. In the 2009-10 budget, Labor paused the indexation of the upper income limit for the baby bonus, fixing the income threshold at $75,000. In the 2011-12 Mid-year Financial and Economic Update, Labor paused the indexation of the baby bonus payment until 2014-15 and reduced the rate of payment from $5,437 to $5,000 per child. Even the language the government uses about the baby bonus is interesting. The bonus was, as I said, introduced as a measure to ensure that we stay somewhere close to a replacement fertility rate in Australia. Why is that important? It is because Australia, like many other countries around the world, has been suffering a gradually declining fertility rate. If you do not have people, you do not have people to do the jobs which this country is currently crying out to have done. If you do not have people, you negatively affect the economic growth rate of the nation. Indeed, a whole series of historical studies have shown that at least a quarter of national economic growth—not just in Australia but elsewhere around the world—comes from population growth. So, if your fertility rate is declining—if your population growth through natural means is declining—that is going to have an impact at some stage on economic development, on economic prosperity, on the economic growth of the nation. The baby bonus was a measure introduced to deal with that specific issue of fertility. But now, when we hear the Labor Party discuss it, they talk about it in welfare terms and they treat it like welfare—not only treating it like welfare but making cuts to it.

Following the cuts made by the government which I mentioned previously, we warned that changes would further limit choice for mothers, particularly those who wish to stay at home—either for a short or temporary period of time or for a period of time while the kids are growing up and going to school—and raise their children. The reality is that Labor is ideologically opposed to stay-at-home mums. For some reason they have decided that mums should not have a choice but should just go back to work or enter the workforce after having their baby. That flies in the face of the practical experience of many families in Australia. The common income in Australia is 1¼ to 1½ jobs, where one partner—maybe the male, maybe the female—is working full time and the other is working on a part-time or casual basis, and families make arrangements over their life course appropriate to their work and family situation.

Let us be clear about why the government wants to slash this payment. The baby bonus slash and burn exercise is expected to provide savings of $505.9 million over the four years from 2012-13 to 2015-16—$505.9 million is therefore going to be taken from the pockets of Australian families, particularly those families having children under this measure. That is half a billion dollars being ripped away from Australian families. This is nothing more than a cynical and cruel attack on families simply to help the Treasurer, Mr Swan, reduce Labor's burgeoning black hole. This is a desperate measure, ripping half a billion dollars from Australian families in order to provide a surplus—a surplus which of course will never be delivered by this government.

It is often claimed that generous provisions that enable women to enter or remain in the paid workforce contribute to higher fertility levels, hence the Australian demographer Hugo argues:

… the international ranking of countries according to their fertility levels matches their ranking on the extent to which they facilitate the employment of mothers in the paid workforce and the extent to which a degree of gender equity applies within the family itself.

Other researchers have reached similar conclusions. Let us look at declining fertility over the past century. Beginning in the 1930s, Sweden introduced policies that enabled women to maintain their position in the paid workforce whilst having children. In the 1980s, the fertility rate climbed to just over two children per woman, leading some commentators to conclude that the reversal was due to the cumulative impact of public day care, child benefits, parental leave, parents' rights to work part time and other measures. These views were reinforced as female labour force participation soared to 81 per cent and the birth rate rose above replacement levels.

But the growth was temporary, falling to the lowest rate ever for the country—1.52—by the end of the century. It would appear that Sweden's birth rate related to the economic cycle and the impact of the so-called 'speed premium' whereby parents were entitled to the same income replacement for a second child born within 30 months of their first, irrespective of the level of income between the two births. The policy would appear to have resulted in births being brought forward, rather than a permanent increase in the number.

It remains important to promote public policy outcomes that boost fertility rates. Prior to the baby bonus being introduced, the fertility rate in Australia had fallen to less than 1.9 children per woman, when our replacement birth rate is 2.1. Policies such as the baby bonus, along with other policies that were introduced by the Howard government, are critical to encouraging fertility. Our public policies should seek to maintain at least a replacement birth rate. People sometimes say that, if you do not have a replacement birth rate, you can make up for it with immigration. The problem with immigration is that the average age of immigrants who come to this country is about the average of the population, and so they age along with the rest of us and it does not help our birth rate. Only, theoretically, if you could somehow attract a larger, much younger cohort of immigrants could you offset some of the effects of a declining fertility rate, but the reality is we are in competition for those young skilled immigrants from all over the world—competition with countries like Canada and the United States—and therefore we cannot attract that larger cohort of younger immigrants.

Singapore provides a classic study of what happens with fertility rates once they go down. Dr Tony Tan, when Deputy Prime Minister of Singapore, announced that their government would fund $50 million over five years to educate the public on family life. The Singapore study illustrates that the birth rate, having been driven down from high levels in the 1950s and 1960s, has got down to about 1.2 or 1.3 and, despite a series of efforts over the last 10 or 15 years, with all sorts of inducements such as health care, accommodation assistance et cetera, it has been very difficult to get the fertility rate back up. Given that Singapore is a small and in some senses closed society, it provides an illustration, a case study if you like, of what happens to a nation when the fertility rate drops below a certain level. It seems to me, from studies that have been carried out around the world, that if your fertility rate gets below about 1.4 or 1.5 it is extremely difficult to raise that fertility rate again, and that has medium- and long-term consequences for that society, for that country—and one of those consequences, as I indicated before, is a decline in what would otherwise have been the economic growth of the country.

Most governments have sought to provide economic support for families. Using the rhetoric of 'family friendly policies', measures range from direct taxation and social security benefits to parental leave and flexible working hours. These policies often have the twin objectives of encouraging fertility and supporting families in the raising of their children. France, for example, has a deliberate third child policy. Whereas Australia, for example, currently pays a bonus on the birth of each child—that will be diminished if this legislation passes—France pays a greater amount for third and subsequent children. This is in addition to parental and maternity leave and childcare and family allowances. The interesting thing about France is that France is one of the few countries that has maintained a birth rate somewhere close to replacement levels. They have done that by saying it is those families who are prepared to have more than two children—those who are prepared to have three or four children—that will bring about the greatest increase in the birth rate of a country. These policies have meant that France's birth rate has stabilised at around 1.9, one of the highest in the Western world.

So public policy motives underpinned the coalition's decision to introduce this measure in the first place and our approach to things like promoting the fertility rate—whereas Labor's policy approach, if you can call it a policy approach, is simply about politics. They are ideologically opposed to stay-at-home mums and they are spending money they just do not have. So, to them, this is a measure that attacks a group they already oppose and helps them scrape some more money to put towards their skyrocketing debt.

The baby bonus payments made to families for subsequent births are important. The third birth particularly helps Australia's fertility rate. And—on our approach to parental support—the coalition have a plan to provide a first-class paid parental leave system. We have announced that and we will deliver that. But recognising that some parents do stay at home with their child is equally important. As I said earlier, families make arrangements not just from week to week or month to month; most families make arrangements over a lifetime in which, if not both partners, at least one partner moves in and out of the workforce, which of course they do to balance their work and family commitments. This government has again sought to attack stay-at-home mums and, therefore, to attack the decisions and arrangements that many families make. The coalition oppose this attack, and therefore we will oppose this bill.

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

I take this opportunity, Mr Deputy Speaker Cheeseman, to congratulate you on your elevation to the Speaker's panel. I believe this is the first time that I have spoken while you are in the chair, but I have been watching your contribution and have seen what a fine job you are doing as a deputy speaker, so congratulations. I know that you will bring great dignity to the role and that you will perform the task extremely well.

While listening to the last contribution to this debate on the Family Assistance and Other Legislation Amendment Bill 2013, that by the member for Menzies, I became quite puzzled. Here was a member from the other side talking about the government ripping money away from families. But, as I found myself thinking, it is the opposition that are the side of this parliament that is about ripping money away from families. They have a plan—they definitely have a plan—for Australian families. They have a plan to penalise Australian families. They have a plan to make it harder for Australian families. They have a plan to take away the schoolkids bonus.

I would like to share with the House this fact: there is no initiative that the government has introduced that has been more widely embraced by families than the schoolkids bonus. Parent after parent has contacted my office saying how helpful it has been to them. Actually, my grandchildren are attending school, and my children have told me how they have been able to use that money to purchase school shoes and other things to help prepare their children for school. I would caution those on the other side of the House: if they are really about supporting and helping families, then they should be ensuring that the schoolkids bonus stays in place.

On the baby bonus, I fully believe that the level of the baby bonus when you have your first child should be $5,000. A moment ago, I referred to my children; they all have more than one child. They had to purchase the cot, bassinette, baby bouncer and all those other things you need for that first child. It is an enormous expense. Then, when they had their second child, they still had the cot, bassinette and baby bouncer—which were also shared among their nieces and nephews—and all those things they purchased the first time. They already had that nursery furniture, so, the second time, the expenditure was not as great. The outlays they had to make were not as great.

If we really want to support families, do we give them a one-off payment or do we provide them with ongoing support through a schoolkids bonus? Now, I know, because families in the Shortland electorate are telling me, that the schoolkids bonus is what they need. They need it for all their children and they need it to assist them at school. They also tell me that the changes to dental care for kids are something that will help them no end because, instead of families having to scrimp and save to maybe be able to afford dental treatment for their child, from July 2014 all children will be eligible for the kids dental care program.

These are among the things that we have delivered since we have been in government that I am not convinced the opposition would keep in place, such as the increase in the childcare rebate, the Paid Parental Leave scheme, the dads and partners leave—all things that are helping families on low and middle incomes and should not be taken away. They are things that are given to families to make their lives a lot easier and to provide them with support—and not just when the baby is born, because the expenditure gets greater as that child grows.

On this side of the House, we recognise that support for families and children is whole-of-life support. It is about ensuring that they have educational opportunities and making sure that as a government we fully fund every child's education. There is quite a strong contrast between what the New South Wales Liberal government is doing—that is, pulling $1.7 billion out of education—and what the federal Labor government are planning to do, which is to invest more in education. It is about whole-of-life support, not a one-off payment at the time a child is born.

The previous speaker spent a lot of time talking about declining fertility. He believes that the way to increase fertility is a one-off baby bonus payment set at the same amount for every child people have. I have news for that member. There are many things that determine whether a woman and her partner decide to have children. They do not look just at a one-off incentive payment to have a child; they look at things such as whether they will have ongoing support once the child is born and whether they will have access to child care, which is a very important consideration when making decisions about whether or not to have a child. You need to be sure that you will have good child care.

On this side of the parliament we are not opposed to women choosing to be stay-at-home mums. We believe in choice. Real choice is not only about providing a baby bonus; it is also about putting in place the support structures that will enable a woman to stay at home and so allow her to choose whether to return to work. The choice is determined by child care, by paid parental leave and—to a large extent—by the availability of flexible working hours. The workplace needs to be tailored to be family friendly so that a woman or a man—whichever person chooses to be the primary carer—can adapt their work hours to fit in with their family responsibilities. It is a very complex situation. Is it a question of just throwing money at families every time they have a baby? Or is it a question of providing support for the family once a child has been born, not in a one-off payment but through access to child care, paid parental leave and proper family leave so that if a child is sick the family has options as to how the child will be looked after? It is also important to make sure that health care is in place so that families are supported in their dental and immunisation costs and in all the other costs of bringing up a child. Also important is affordable education. We on this side of the parliament have contributed significantly to providing affordable education with the introduction of the schoolkids bonus and other initiatives that increase support for families when their children are attending school.

In the Shortland electorate there is a really good program. It is called the Better Futures program, and it has been a great success. Rather than encouraging women to have more children, the program is providing support to young women who have children before they finish their education. These young women need extra support and need to be given options in their lives. The Better Futures, Local Solutions program is operating in 10 regions throughout Australia, and the part of the Shortland electorate where it is operating is an area of acute disadvantage where one in four families is jobless and youth unemployment is very high. There are a large number of young women there who have had babies at a very young age. The Better Futures program provides hope for the future and gives young people the opportunity to succeed. It has been an outstanding success and provided a range of opportunities for young parents and their children.

The program has been delivered through a number of flexible options. There is the DALE program, which is operated through St Philips Christian College—where Kevin Berger has done an enormous amount of work—and the Local Employment Access Program, which is being operated through the San Remo Neighbourhood Centre. These programs provide support for the young women when they have children. They also help them plan the whole of their life during the years that they go from being young women—some are as young as 14—who have babies to completing their education. The program puts in place support for the women for the whole of their children's lives. These programs are more than just a one-off payment; they provide whole-of-life support for the women and their children.

As a government and as a society we have to look at providing more to families than a baby bonus of $5,000 every time they have a child. I fully support the need to pay a $5,000 baby bonus to a family when they have their first child or for multiple births, regardless of birth order. If you have twins on the second time then it should be $5,000 because the outgoings, the expenses, at that time are greater.

But I think the real way that we can help families is by providing them with support, not only at the time of the birth. At the time of birth, the other type of support that new parents need is hands-on support such as visiting health workers to help them to come to terms with the enormous change that has taken place in their life. A lot of information is put out there about what is going to happen when you have the baby, but there is very little information put out there about afterwards. So to look at the decisions around children—having babies and fertility rates—and link that solely to the baby bonus is, I think, very, very narrow. It is an approach that I do not think will work for the betterment of our society. I believe that when parents have a second child or a third child $3,000 helps them with those initial costs, but we also need to look at this as a whole, as a big picture, in terms of what we can do to support families throughout the life of their child.

Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

Listening to the member for Shortland, you would think that only Labor cared for families. She knows, as do the member for La Trobe, the member for Cunningham and even you, Member for Lyons, that that is just not so. Anybody in this place, as I am sure the member for Paterson, who is sitting at the table, would agree, cares a lot about families. Families are the core of Australian society. They are very much the backbone of Australian society. They make communities run. Families are so crucial to the betterment of our society, and may it long be the case that we as a parliament can do whatever we can to help and support families, and certainly at the time of the birth of a child. As I am sure the member for Shortland, being a mother and a grandmother—and no doubt a good mother and a very good grandmother—would know, the birth of a child is a time when costs are high. As a father of three myself, I know how that can be a strain on the family's budget.

The member for Shortland talked of whole-of-life support, and, again, I find myself in furious agreement with her that we as a parliament should be doing everything that we can to support people from the cradle to, indeed, the grave; it is so important. She also talked of the Gonski report. I know that the Prime Minister made a big funding commitment in recent times to improving the nation's literacy for our schoolchildren. The Gonski report, which has been handed down, has good initiatives, but where is the funding for them? Where is the funding going forward for these initiatives, which, in some cases, are not going to take effect until 2019—six long years away? Where is the funding going to come from? Hopefully, it will not be coming from that side of politics, because hopefully that side of politics will not be governing; it will not be in charge of the treasury bench when these important reviews are due to take effect as legislation.

I was slightly bemused by the reference to dental care for kids. We all know that there is nothing worse than a toothache, and certainly for children a toothache can have dire implications for their ability to converse with others, their ability to learn in school or their ability to mix with others in the playground and whatever. But it was that side of politics, the Labor side, which last year made it so hard with their new dental care arrangements, their new dental care policy, for people to access the public health care that is so needed for proper dental services. Oral health is crucial to our society.

Whilst talking of whole-of-life support, I should note too that I do not think any side of politics, whether federal or state politics, pays enough attention to palliative care. As politicians, we should do more to ensure that there is palliative care, particularly in regional areas. This is absolutely crucial. I am sure the member for Shortland would agree with me on the need to be able to give people in their final stages of life the dignified and caring attention that they so desperately need. In my own electorate of Riverina, in Wagga Wagga, it is such an important issue at the moment. We certainly need to improve our palliative care services. We also need to provide prostate biopsies for men, because at the moment they are not available in Wagga Wagga Base Hospital. People have to go to either Young or Griffith to access those services, which in this day and age is simply not good enough.

I speak on the Family Assistance and Other Legislation Amendment Bill 2013 because it is an important one in the life of this parliament. It is important to put on the record my feelings about what this bill will implement. Certainly a lot of people in my Riverina electorate would want me to talk about the schoolkids bonus as well as the family assistance payments. I know how many of them have actually made inquiries to my office about these very important things.

This bill implements the government's changes to the baby bonus announced in the 2012 Mid-Year Economic and Fiscal Outlook and also makes amendments to family assistance and social security payments. As of 1 July 2013, the amount of the baby bonus for the second and subsequent children will be reduced to $3,000. This change will be reapplied regardless of whether the child is born into the family, adopted by the family or is entrusted into the family's care within 26 weeks of the child's birth. The baby bonus will continue to be paid for a family's first child, and for each child who comes into the family in a multiple birth, adoption or entrustment to care, at a rate of $5,000.

This bill will also make amendments to ensure that families can continue to receive the family tax benefit until the end of the calendar year in which the child finishes secondary study or its equivalent. Additionally, the qualification period for the double orphan pension is being extended so it corresponds with eligibility for the family tax benefit. As the family assistance act currently stands, under section 22B(3) a child continues to be a senior secondary schoolchild until 31 December if the day the child completes the final year of secondary school, or equivalent level education, is in December of that calendar year. If the day of completion is before December then the child continues to be a senior secondary schoolchild for a period of 28 days after completion. This allows for continued eligibility for the family tax benefit until the end of the calendar year for a child who completes secondary school in December, or for a period of 28 days if the child completes school before December.

This bill will amend the family assistance act so that eligibility for the family tax benefit will continue until the end of the calendar year for a child who completes secondary school in either November or December of that year. The amendment confirms access to the family tax benefit until the end of the calendar year for students who complete secondary study in the usual way, normally by sitting final examinations. The amendments also ensure continued family tax benefit eligibility for a child for a period of 28 days after completion if the child completes secondary school before November.

A recent judgement of the Federal Court interpreted 'entrustment to care' differently to the current family assistance legislation, which provides in general that the baby bonus is payable within 52 weeks after a child is born or entrusted to an individual's care. The existing policy states that the baby bonus is payable at around the time of the child's entry into a family, when the family is likely to incur set-up costs. The judgement found that the baby bonus may be paid at some time after a child enters a person's care, when a formal process of adoption begins. This bill will make amendments to clarify the meaning of 'entrustment to care' to reflect the intended policy so the baby bonus is only paid around the time the child first enters a person's care.

The definition of a 'young person' in section 5(1) will be also be amended to extend the double orphan pension qualification period of students completing study by aligning it with the family tax benefit eligibility period.

Amendments will be made to the schoolkids bonus to ensure that students under 16 years of age who have already begun primary or secondary school but who are unable to participate for a period due to special circumstances are still able to receive the schoolkids bonus. Minor amendments have also been made to clarify the periods within which customers need to notify that they are engaging in eligible study.

Minor changes are to be made to the clean energy supplement under the family assistance law to ensure that, if individuals end their choice to receive the supplement on a quarterly basis and start to be paid on a fortnightly basis instead, they can be paid their arrears immediately instead of having to wait until the end of the quarter. A further amendment removes an anomaly which prevents a member of a couple being entitled to a clean energy advance top-up in certain situations.

Amendments similar to the one I have just mentioned will also be made to the social security law and the Veterans' Entitlements Act 1986 to clarify that customers who decide to end payment on a quarterly basis of the clean energy supplement, pension supplement or seniors supplement are not required to wait until the end of the quarter to be in arrears. Whilst talking of the Veterans' Entitlements Act, I ask the government: if it is this easy to change this particular legislation, why can't it also be altered to give veterans fair and just superannuation payments? It just remains unfathomable.

Dick Adams (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

Order! The honourable member will come back to the bill.

Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

Sure.

Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Link to this | Hansard source

Good point, though.

Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

But it is a good point. While I certainly do not want to talk against your ruling, Mr Deputy Speaker, which I fully adhere to, the member for Shortland talked of whole-of-life support, and certainly our veterans have given this country every bit of their whole-of-life support, and they do deserve—with all due respect to you, Mr Deputy Speaker—to be looked after in their retirement because they lay their lives on the line for our country. To get back to the legislation, which I know you would like me to do, Mr Deputy Speaker, whilst these are minor and technical amendments in the legislation before the House, they will ensure that people receive the correct amount of quarterly payment and receive the payments at the correct time.

The coalition introduced the baby bonus in 2002 for the purpose of raising Australia's declining fertility rate. We heard the shadow minister talking about how important that was. And I can recall that the former Treasurer, Peter Costello, knew how important it was to arrest that slump in the nation's fertility rate, and obviously to increase it above the necessary two, to make sure that the Australian population grew. That is obviously very important, because as the population ages so does the reliance grow on younger people to work longer and harder to make sure that we pay the necessary pensions for retirees as well as for people who are receiving welfare.

Labor has repeatedly—I repeat: repeatedly—slashed funding for the baby bonus in a desperate attempt to find savings. And this is a desperate government. The Treasurer needs to balance the books. We know he is not going to produce the first surplus since 1989 under Labor. Obviously, the coalition invariably produces surpluses, but Labor's last surplus—as we heard the shadow Treasurer, the member for North Sydney, speaking of in the discussion of the matter of public importance today—was in 1989, and obviously Labor needs to begin to correct that, and this is one way that it is going to attempt to do it.

In the 2009-10 budget, Labor paused the indexation of the upper income limit of the baby bonus, fixing the income threshold at $75,000. Then, in the 2011-12 mid-year financial and economic update, Labor again paused indexation of the baby bonus payment until 2014-15 and reduced the rate of payment from $5,437 to $5,000 per child. Now here Labor is again, lowering the baby bonus for second children and any additional after that from $5,000 to $3,000. Why is Labor so intent on limiting choices for mothers, particularly those who wish to stay at home to raise their children? We should be encouraging, in every instance, those wonderful, brave, stay-at-home mums. All mums are great. We know that. And I am sure everybody in this parliament knows it. But those stay-at-home mums need to be helped and helped in every which way we can. Stakeholder groups who advocate for stay-at-home mothers have continually raised concerns about the inequality between paid parental leave and the baby bonus. This current move by the Labor government does nothing to address those concerns.

Labor will try to argue that this is not a simple money-saving measure, but we know that it is. The facts show these baby bonus changes are expected to provide savings of $505.9 million to half a billion dollars over the four years from 2012-13 to 2015-16. This cut to the baby bonus—and that is what it is; it is a cruel cut—will place further financial burdens on Australian families already struggling with the day-to-day rising costs of living, higher cost of groceries, higher cost of petrol and a carbon tax that the Prime Minister said that she would not introduce under a government she led. They are not helped by hoards of asylum seekers and by illegal refugees arriving on our shores. We are paying upwards of $170,000 per illegal boat person arrival. That is all having an effect on the ability of the government to be able to give families a fair go, because at the moment they are not getting a fair go from this government.

The government claims this decrease of $2,000 reflects that families do not generally face the same upfront costs for a second child or a later child as they do for their first. Whilst that is correct to some extent, this is a blow to families. It is an unnecessary and cruel blow. It is about time this government listened to families and their cries for assistance, rather than delivering them blow after blow.

Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Link to this | Hansard source

I rise to speak tonight on the Family Assistance and Other Legislation Amendment Bill 2013. As previous speakers have outlined, it contains some provisions that are largely unobjectionable: they deal with administrative arrangements and adjustments, some of which have been explained in terms of synchronicity of payments with the end of the school year and ensuring eligibility is extended to people of care responsibilities that might not have originally fallen within the scope of the legislation—that is the relatively innocuous part of the bill. What is most significant about the bill is its tax-grab character against families where there are stay-at-home parents. That has achieved a half billion dollar budget recovery hit, designed to help paper over the extraordinary budget deficits that now have become part and parcel of Labor administrations.

We heard earlier in question time today that it was in 1989 when Labor last delivered a budget surplus. For those that think back that long, I remind them that was when Mick Hucknall had a No. 1 his song that year: If You Don't Know Me By Now. That is quite topical, as it illustrates that for those members of the Australian public looking to Labor—

Ms Bird interjecting—

I did go to one of their concerts, which was quite special. Thank you for that, I was just reminding myself of that era. Thank you for the encouragement and a reflection on some years gone by. It was a long time ago. Mick is still around, but budget surpluses are not under Labor administrations. What the Australian public does understand and does know by now is that Labor does not deliver budget surpluses. In this bill, there is an attack on stay-at-home families with second and subsequent children to create a half a billion dollar improvement in an extraordinarily deteriorating budget position. We have seen about $172 billion worth of accumulated budget deficits—the four largest in Australia's financial history—accumulated under this administration in an effort to try and go some way towards honouring one of the rolled gold, etched in a tablet of stone, promises to restore the budget to surplus.

This was one of the measures that was included in the 2012-2013 MYEFO—the Mid-year Economic and Fiscal Outlook. It was an interesting outlook statement from where the major measure in this bill arises. Did you know, Mr Deputy Speaker, that in that bill there was no mention of any support for small business? It is quite remarkable at a time when everyone is talking about employment and there has been a quarter of a million jobs lost in small business over the last five years. Despite population growth—

Dick Adams (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

Order. Will the honourable member come back to the bill?

Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Link to this | Hansard source

there was no mention of small business. In fact, as it relates to family formation, the interesting thing is that the only mention of support for small business is what the Chinese government was doing and how somehow that would prop up the Chinese economy and therefore—

Dick Adams (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

Order.

Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Link to this | Hansard source

be helpful to the budget. The measure in this bill was about a half billion dollar cash gouge out of stay-at-home families in relation to second and subsequent children.

The policy motive, as it is articulated by the government, is that second and subsequent kids do not cost as much. That has not been my experience. As I talk to people who have had children in the recent era, it is an interesting thesis to bring forward. I am reminded that frugal and economically conservative investments in furniture for newborns tends to involve purchasing a bed that can have the base elevated to be a cot during the nano human phase of the child's development. As they move from nano human to micro human, you can lower the base of the bed and then the sides can go up and down. As they go from nano to micro to mini human, then you take the sides off the very same article: then that is a bed.

That has been my experience from nano to micro to mini human. It spreads right across the birth of a second child in my household when we had to do it all again. We could not break the news to Madeline that she was going to lose her bed because of some policy idea that she had to forfeit it now that Isabella had come into this world. We had to buy the same arrangements for Isabella. When she was at that nano age, we had the base elevated and it was a nice, snug little spot. As she moved from nano to micro, we lowered the side—but we had the bits that could pull up so she did not clunk her head and fall out during the night. As she became a mini human, the sides came off and she was a big girl. But it took some years before she got a big girl's bed.

That journey is also replicated in capsules and seating for cars. I do not know whether anyone in this place other than those of us who have recently been parents have looked at how biblically expensive safe seating is for motor vehicles these days, and how you are encouraged to maintain that structured and supported seating arrangement into the child's seventh year. Unless you are planning to spread the children seven years apart—and that certainly would not fly in my household—the idea that we could reuse those pieces of child rearing infrastructure, if I could use that term, is a little bit of a fiction. It is just not borne out in reality. Therefore, those stay-at-home parents are left wondering and bewildered as to why there is this reduction in the baby bonus for second and subsequent children.

This comes at a time when cost-of-living pressures for families are very significant. Many of the families I represent in the Dunkley electorate do not have much wiggle room at the end of the month; it is a close budgeting exercise for them. My colleague and friend the member for Riverina touched on some of those cost imposts, including the carbon tax. Stay-at-home families are running their households during what is the most expensive period in which to be consuming energy—if you look at time-of-use energy consumption. Those that are not stay-at-home families—their children are in care or at school, and the household is largely vacated—are spared the peak power costs of maintaining a healthy living environment for those in the home. These families are copping the most punishing impacts of the carbon tax. Despite the concept that these families with second and subsequent children somehow have less financial pressure, I would contend that the evidence is to the contrary and there is in fact a greater degree of financial pressure. The notion that you can simply roll over child-rearing infrastructure and that that somehow represents a saving as the logic for this reduction in the baby bonus for second and subsequent children is utter nonsense. This is simply about trying to make an ugly budget position that the Labor government has steered itself and the nation into slightly less bad than it otherwise would be.

If you look at the measures themselves, a couple of other things come to mind. One is that, just as proper support is needed for stay-at-home families, proper support is also needed for those who choose a different pathway. We have heard time and time again how the deficiencies in the government's paid parental leave system failed to recognise that, for households that are raising children and looking to some paid parental leave support, under the government's regime, that defaults back to a minimum wage level. The reality in households is that, when a child arrives, the bills do not default back to the minimum wage level, the mortgage does not all of a sudden default back to a minimum wage level, the financial commitments that you have made do not miraculously default back to a minimum wage level—yet that is the assumption that is embedded in the government's program. In addition to that, for primary carers, mainly women, who are seeking paid parental leave assistance during the early period of raising a new arrival in their family, the loss of superannuation and other benefits represents an ongoing financial impediment in terms of their security and retirement income possibilities—another deficiency in the government's paid parental leave scheme.

That is why I am pleased that the coalition has brought forward a policy for a fair dinkum paid parental leave scheme that recognises that support is important for stay-at-home parents and also for those that do not choose that pathway in terms of their family arrangements. It is particularly encouraging that the coalition's policy recognises the circumstances facing small business. Women who choose to contribute to that engine room of the economy—albeit one that is spluttering a little bit under this government's policy setting—should not be disadvantaged in terms of their access to paid parental leave support. Under the coalition's policy the types of schemes that are so attractive and offered by the Public Service or major corporations all of a sudden come within reach of the small business sector of the economy and, therefore, small business is enhanced in its capacity to recruit very capable women who might otherwise not be attracted to working with small enterprises because they cannot access the more generous paid parental leave arrangements of the corporates and the public sector. That is overcome by the coalition's policy position as well.

Also in this bill are the administrative arrangements relating to dad and partner pay. How topical this is. I have tried on a number of occasions to point out to the government how mindless, senseless, unjustified and unnecessary is the government's insistence on imposing the paid parental leave pay clerk responsibilities on smaller employers in particular. We tried to maintain the system that was in place when the government's program was initially introduced, where the Family Assistance Office of Centrelink were the ones that processed those payments. Having determined eligibility against material supplied by the employer and the applicant seeking to confirm their eligibility, the government made those payments directly to those eligible people. In that window, in that nirvana, as it was described by the minister, when there were so many people welcoming the paid parental leave opportunity, the very system that was in place that gave rise to boast after boast from government ministers about the scheme, we just wanted to keep that system in place, that architecture in place.

But no, that was not enough. The government needed to go against its promise that it would not impose additional administrative and cost burdens on employers with the introduction of its scheme. It had to insist, under the threat of substantial fines, that smaller employers, with no business in calculating eligibility or the nature of the scheme, would have the government decide to whom and in what amount the payments would be paid and then descend those payments to those small business, under threat of a fine, to process as if they were part of the payroll system—but then have them removed from the payroll system as they related to payroll tax, superannuation contributions and workers compensation liabilities. We said: 'No, the system is in place, the infrastructure is in place. Why impose this needless burden?' What does this bill do? The bill relies on the very system we wanted to have operate across the whole paid parental leave scheme, where the secretary carries out that responsibility. No, instead the government wanted the secretary to decree that an employer—particularly a small employer—would do that work that the government was doing previously when Jenny Macklin and ministers responsible for this program were boasting about its success.

What a vivid contrast to Friday, 13 July 2007, when Ms Plibersek, Ms Macklin and Ms Gillard issued a joint press release promising, in respect of their paid parental leave scheme, 'Labor will not support a system that imposes additional financial burdens or administrative complexity on small businesses or in any way acts as a discouragement to the employment of women'. What did they do? They went and did the very thing that they promised not to do. When we came to try and have the provisions that are re-emphasised in this bill before the House that are now utilised for the payment of dad and partner pay, when we came to this chamber to see that those very same mechanisms be used that are embodied in this bill today, we were rejected. It was voted down.

The Independents, supposedly concerned about red tape and compliance burdens on small business, lost their way. In fact, Independent member Mr Oakeshott, days after voting against the very measure that would reduce red tape and compliance costs, got up in the National Press Club and said he was concerned about how small business have been:

… really whacked … around the head and this parliament will be a small business friend and help with these compliance challenges—

these are his words, so I apologise for the length of sentence—

as we challenge small business with important reforms, such as paid parental leave and a carbon market.

He went on to say he was concerned about the compliance burden. He voted just days earlier against the very measure that would have relieved the very compliance burden he went on to speak about. Then, to add insult to injury, he did it again when we gave the government and the crossbenchers an opportunity to understand the compliance burden small business is facing.

Here we have another bill relying on the very provisions that we sought to have the government use for the payment of the Paid Parental Leave scheme, particularly for smaller employers. Again, they have turned down the opportunity. They have walked away from the opportunity to reduce the red tape and compliance burden facing small business. You do not have to take my word for it. These provisions, which are now being embraced in the bill before the House, are the very same provisions we wanted used for the scheme in general and we got endorsements from so many small business organisations. I say to the government that it is not too late. You can amend this bill to embrace the red tape reduction measures that would end the compliance and red tape obligations under the threat of a fine forcing Paid Parental Leave paymaster roles on small employers unless and except where the eligible person and the employer agree. In that case, let them do it. But, otherwise, do the right thing and relieve some of the compliance burden embodied in the system.

Laura Smyth (La Trobe, Australian Labor Party) Share this | Link to this | Hansard source

I am pleased to be able to contribute to this evening's debate. The Family Assistance and Other Legislation Amendment Bill 2013, as has been apparent in the discussions up to now, reflects a measure announced in the 2012-13 MYEFO. It is designed to maintain the appropriate financial support for those who are having a new child while ensuring that our family assistance measures are sustainable into the future. It is very important that we contemplate that in the context of this bill.

In the course of the debate this evening there has been a great deal of focus on the cost of living. Needless to say, that is borne out in the question of providing the baby bonus for new parents. But it is borne out in a range of other ways. It is rather disingenuous for members of the opposition to be coming into this place clearly articulating that they are going to slash the schoolkids bonus, a practical means by which this government has been able to respond to cost-of-living pressures upon families amongst other things, while talking about their credentials in relation to the cost of living.

It is particularly timely in the context of some recent events in my electorate that we have a discussion in relation to this bill on the cost of living because the Leader of the Opposition was in my electorate during the last couple of weeks and took the time to reflect on the cost of living. Regrettably, it was to a fairly small audience, a very closely held group of people. Indeed, a former Liberal Party candidate for the 2010 Victorian state election hosted the event. It was a very closely held event in Beaconsfield in my electorate. The Leader of the Opposition talked about the cost of living. It was interesting that he failed to reflect at that morning tea on the cost-of-living implications of cutting the schoolkids bonus for the some 10,300 families in my electorate, the some 18,000 children in my electorate and some 1.3 million people around Australia who stand to benefit from it. He certainly shied away from discussing that. Likewise he shied away from discussing the household assistance package that Labor has put in place. He shied away from any kind of certainty in relation to the tripling of the tax-free threshold which Labor has put in place which has certainly been to the benefit of people in my electorate. It seems that the only people who are actually concerned about families and their cost-of-living pressures are on this side of the chamber. Indeed, the only person who is threatening families, threatening to impose additional taxes and threatening to take away family assistance is the Leader of the Opposition.

This bill is a particularly important measure which continues to maintain the current baby bonus arrangements for a family's first child or multiple births, regardless of the birth order of their children. Under the new arrangements, the amount of the baby bonus for second and subsequent children will be somewhat reduced to $3,000 from 1 July this year. Notwithstanding that, other forms of assistance continue to be available to eligible parents through Labor's Paid Parental Leave scheme, dad and partner pay, and the family tax benefit.

It is interesting that the previous speaker in this debate, my new neighbour, the member for Dunkley, was reflecting on the Paid Parental Leave scheme. It is extraordinary what people can come up with when they had more than a decade to implement what they say is a much more effective and business friendly paid parental leave scheme. It is very interesting that they chose not to consider a paid parental leave scheme until Labor came up with one. It is also interesting that they choose to fund their paid parental leave scheme through a tax. So when we are talking about real cost-of-living issues, practically responding to the pressures on families and ensuring that modern Australian families are provided with the financial support that they need when they have a new child in the family it is only Labor that has a practical response. It is only Labor that is capable of funding it.

The bill before us will ensure a range of other things in relation to the payment of the family tax benefit and double orphan pension arrangements. The bill will ensure that families remain eligible for the family tax benefit until the end of the calendar year and their child finishes school. The qualification period for the double orphan pension is being extended so that it aligns with eligibility for the family tax benefit.

In contemplating the family tax benefit, it is important to remember that Labor has ensured that up to $110 more per child is made available in family tax benefit A and $69 per eligible family in family tax benefit B since May 2012. That means around 900,000 families are now benefiting from Labor's lifting of the childcare rebate to 50 per cent of out-of-pocket expenses. It means that a range of practical financial measures are being made available to families right across Australia.

I certainly recognise the significance of those family tax benefit measures and I certainly recognise the significance of our lifting of the childcare rebate, since my electorate is home to an increasing number of young families. My electorate comprises a very significant proportion of the growth corridor of Melbourne and it is those families who stand to benefit from the practical measures that Labor is putting in place, while simultaneously ensuring that we have a sustainable family payments system into the future. It is for that reason that I am pleased to speak in relation to this bill this evening, a bill which balances the needs of families having first children and recognises the needs of those families with second and subsequent children but does so in a way which ensures that our family payments system is sustainable into the future.

The opposition this evening have reflected very significantly on the cost-of-living pressures which affect families across Australia. They have not, however, reflected with any great depth on their approach to the household assistance package measures which Labor has put in place during the last year. Indeed, it is worth bearing in mind in the context of the debate this evening that the opposition’s measures in relation to a clean energy future will have the effect, it is estimated by Treasury, of imposing a $1,300 impost on each household in Australia. So not only is their Direct Action Plan something which will impose rather punitive measures on households financially; they are still entirely unclear about where they stand on the household assistance package measures which have gone to support not only families but pensioners, low-income earners and a range of people right across electorates such as mine. Indeed, around 3.2 million pensioners are $172 better off for singles and about $182 better off for couples combined a fortnight as a result of Labor’s pension changes. Those pensioners should know that it is Labor that has been concerned about their cost-of-living pressures and that it is Labor that has endeavoured to ensure that they are properly supported. Again, during the more than a decade that the opposition were in office, they failed to respond practically to the needs of pensioners. They now come into this place and purport to be standing up for families facing cost-of-living pressures and for pensioners facing cost-of-living pressures but they are entirely disingenuous about those cost-of-living pressures.

This bill is a particularly responsible measure that is being put in place recognising the needs of families with young children or expecting young children, at the same time recognising that we have an obligation to ensure that our family payments system is sustainable into the future. This bill makes some changes to the baby bonus to ensure support for new parents with what we all know are significant upfront costs of having a first child but it ensures that we are realistic about some of the costs which follow on for second and subsequent children. The baby bonus, under the legislation, will continue to be paid at a rate of $5,000 for a family's first child and for each child in a multiple birth or adoption. We know that these changes were flagged in the 2012-13 MYEFO, so the opposition has had a substantial opportunity to consider them, to consider how they might respond and to consider how they might best reflect on cost-of-living pressures and other pressures facing new families. Yet we are still in the dark about the kinds of arrangements they might put in place if they were to come to office to support families through the family tax benefit system, through the changes to the tax-free threshold and through the range of changes that Labor has put in place. On these matters the opposition, at best, remains silent and certainly is somewhat confused.

Since coming to office Labor has acted steadfastly to support jobs throughout our economy. Indeed, we have seen almost 850,000 jobs created since coming to office. This is one of the most significant ways in which we have practically been able to support families, ensuring that they continue to have a job, ensuring that family members continue to be able to support themselves. Needless to say, during the period when we were contemplating Australia’s response to the global financial crisis, the opposition remained asleep at the wheel. They were incapable of providing a clear direction at that time. Indeed, the Leader of the Opposition slept through some of the debates which Labor had to ensure that we supported an economic stimulus package for our economy. The opposition’s approach would have meant that we would have lost several hundred thousand jobs at that time and, as a consequence, many families that Labor has supported during its period in office would have found themselves without an income, without a way of supporting themselves.

At the time the opposition left office, the interest rate impost was substantially higher than it currently is—so much so that now families are paying around $5,000 a year less on an average mortgage of around $300,000. These are practical measures. These are significant practical circumstances which Labor has presided over and which have meant that families have not felt the pressure that they might otherwise have felt under a coalition government.

Labor has ensured that families are appropriately supported through its family payment measures. The bill before us tonight continues that. Labor has also ensured that our economic settings provide the circumstances in which employment remains a priority and employment ensures that families are appropriately supported with an income. It is with pleasure that I have been able to contribute to this evening's debate on another significant set of policy measures designed to ensure that our family payment system continues to respond to the needs of families such as those in my electorate.

Debate adjourned.