Chris Evans (WA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Hansard source

I have pleasure in speaking to the Families, Community Services and Indigenous Affairs and Other Legislation (2006 Budget and Other Measures) Bill 2006 on behalf of the Labor opposition. It implements various 2006 budget measures, certain other measures associated with the 2005 budget and the government’s welfare changes. It also introduces into legislation a new disaster recovery payment. Labor will be supporting these measures, which the government plans to implement as of the first of next month. They do provide much needed financial assistance to Australian families.

Labor is pleased that the government has acted on some concerns raised by Labor at the last election with regard to the family payments income free threshold and the large family supplement and that it has introduced some changes in these areas. The principal measure in the bill increases the income threshold for family tax benefit A from the current $33,361 to $40,000. This will be subject to annual CPI indexation from 1 July 2007. The 2005 budget included a measure to increase the threshold to $37,500 from 1 July 2006. This measure supersedes that. As a result, half a million families will receive, on average, an additional $37 per fortnight as of 1 July. The measure is costed at a little over $993 million over four years. As a result of this change in the threshold, more than 40,000 families will also become eligible for the low-income health care card.

At the last election, Labor proposed an increased threshold for the commencement of the withdrawal of family payments. Labor is pleased the government has recognised that the current income threshold is too low and that in the legislation it has picked up Labor’s concerns. Families are under growing financial pressure, and this increased assistance is welcome and has Labor’s support.

The legislation also makes a significant change to eligibility for the large family supplement. Currently the supplement of $248 a year is paid for the fourth child and any subsequent children in each family. The change under this bill means that the supplement will be paid to families for the third child and any subsequent children. This will cost about $497 million over four years. Many large families face significant financial stress, and this measure should provide some assistance.

At the 2004 election Labor proposed doubling the large family supplement to what then would have been $489 per child. Under the change in this legislation, a family with four children will receive the supplement for both their third and fourth children, and therefore their benefit will be doubled. Families with more than four children will, of course, receive the extra $248 now paid for the third child. They will not, however, receive the boost that would have come from Labor’s proposal to double the payment. Nonetheless, we are pleased the government has followed our suggestions and is providing some additional assistance for large families.

The bill also extends eligibility for the utilities allowance to people who are under the age pension age but are in receipt of the mature age allowance, widow allowance or partner allowance. This will provide the individuals affected with an additional $102 per annum. The cost over four years is in the order of $27 million.

The legislation introduces a new disaster recovery payment into the social security law. Previously disaster recovery payments, such as to those affected by Cyclone Larry, have been made on an ad hoc basis. This new legislated payment will be non means tested, nontaxable and paid to Australian residents affected by an eligible natural or non-natural disaster domestically or overseas. The payment will be $1,000 for an adult and $400 for a child. The measure will take effect as of 1 December this year and it is estimated to cost about $13 million over four years. Of course, one is never sure how much the payment will be required.

The bill also seeks to implement a maintenance income credit from the first of next month. This allows individuals to claim a previous year’s maintenance income free area for family tax benefit part A on late child support payments received in the current year. Therefore, individuals receiving backdated child support payments from a previous year do not face a reduction in their current year’s FTB A payments. Credit for this probably goes to Senator Patterson, the former minister, who I know was very strong on the subject. I understand this will cost about $52 million over four years.

The bill introduces two changes with regard to severely disabled people. The first is an extension of the qualification for the carer payment to carers of children under 16 years with a severe disability. This will exempt current recipients of the parenting payment who meet the qualification under the legislation from the activity tests applied under the government’s Welfare to Work changes. Another measure will allow families with the financial means to establish trusts to provide for the future care and accommodation of a family member with a severe disability. The value of the trust can be up to $500,000 without affecting the person’s pension eligibility. Gifts to the trust, to a total of $500,000, from parents or immediate family members will not affect the donor’s eligibility for social security or Veterans’ Entitlements Act payments. I think this is a measure that starts us on the process of reforms that have long been needed to assist people caring for people with disabilities and providing for their long-term future.

The bill also implements the recommendations of the Uhrig review with regard to the governance arrangements of the Australian Institute of Family Studies and also seeks to make minor technical amendments to the social security law. I understand Senator Bartlett of the Democrats has proposed amendments to this section of the legislation in reference to the appointment of the institute’s director. Unless the government convinces us otherwise, Labor will be supporting the Democrats’ amendments.

In summary, Labor is pleased that the government has followed some of the directions that Labor set in addressing some of the areas of need with regard to the income cap for family payments and the large family supplement. We indicated at the time of the budget our support for these measures and our willingness to ensure their passage in time for early implementation. I conclude by reaffirming that Labor will be supporting the bill. (Quorum formed)