Ron Boswell (Queensland, National Party) Share this | Hansard source

The Senate is debating the Families, Housing, Community Services and Indigenous Affairs and Other Legislation Amendment (2008 Budget and Other Measures) Bill 2008. My interest in this bill relates to the government proposed amendments which repeal aspects of their treatment of fringe benefits. Following questions I raised in estimates and complaints from the community sector, the government was alerted to the severe impact the changes would have on the community sector. It is strange that no-one, from the department to the minister, even thought to be across the details of the impact on so many Australians who stood to lose some $50 a week in family payments because of the fringe benefits changes. I note for the record that these changes to reportability are actually made properly workable by the bill before us in its original state.

The need for new amendments reflects an unforgivable oversight in the Minister for Families, Housing, Community Services and Indigenous Affairs’ ability to handle her portfolio. At best, it is an oversight of huge proportions. It reflects little interest from the current administration in monitoring and evaluating the system they are entrusted to deliver. Once the election bells ring, it is the new government who is responsible. That responsibility certainly extends to letters that have gone out in the Rudd government name advising working families that they are about to lose a heap of family benefits. I do not know whether anyone in the department was aware that thousands of letters were going out advising mums and dads that their family benefits were about to be gutted. I do not know why that did not ring a bell with anyone. Was anyone there looking after the interests of Australian working families, or was it just a posture? Consequently, the Treasurer and the families minister fronted up to a press conference last week to say they would fix the problem, and so we come to today’s bill and amendments.

The questions raised by this sequence of events are very disturbing and go to the heart of the style of operation of this government. Here we have a budget bill that originally included changes to the fringe benefits tax treatment. It is therefore the Rudd government’s bill and they are fully complicit with the impact of the grossing up salary sacrifice of contributions on not-for-profit-sector workers’ access to family benefits.

The government now bring in more amendments to fix up the mess they have voted for and presided over. Most importantly, they were the ones that sent out the letters. They were in charge when the letters were sent out. The Rudd government own this chaos. At 10 seconds to midnight, Labor are rushing in amendments to stop thousands of families from being deprived of their well-deserved family benefits. This chaotic way of running the country begs the question: what else has gone unnoticed or been overlooked?

I turn to the closely related issue of the government’s proposal to make other changes to the definition of ‘taxable income’ as announced in the budget. The Australian Services Union estimated that the bill we are now dealing with, with complications arising from the government’s misunderstanding of how a change of the definition of income would affect thousands of working families from July 2008, would hurt 200,000 charity workers. I am very worried about what has been overlooked in the expanded definition of income for 2009. I have been pursuing the minister and the department in estimates and in this chamber, and I am still waiting on a promised briefing from the minister representing the families minister in the Senate, Senator Evans.

We know from this work so far that there are a whole range of government support programs and assistance delivered through the tax system that are to be affected by the expanded definition of income. From July 2009, income will be grossed up with items that previously were not considered, such as salary sacrifice and net investment losses. This adds to the paper income of working Australians so they have reduced access to benefits. They lose money which they are currently entitled to under the existing system. That is why there are no little cameo moments in the budget papers telling families what they will get from July 2009—because the goodies are only for this year. Those are our tax cuts. Next year the rules are going to change, and the average Australian working family will not be able to claim the same rate of benefits as now. Their eligibility will be reduced because their income for the purpose of claiming the benefits will have gone up. I am sincerely worried that the government has another fringe benefits crisis on their hands, except magnified many times.

In the Treasurer’s press conference, where he confessed to the huge problems for community sector workers, he also said that the 2009 changes would be all right because there was still plenty of time to work them through. But that is what a Treasurer does. The Treasurer works all the sums through before he puts them in the budget; otherwise, what use is the budget? He could just make up anything and put it in there. If you have a budget in black and white and you deliver it to the parliament, you are accountable for everything in it. You cannot just wait around and hope that everything works out in the end.

We have seen over the last week a government that does not understand what it has done. Fancy putting 200,000 charity workers up for a pay cut! I believe I found out before the government because people started to ring me when they received the letters to ask what it was all about. That is when I started to inquire. That led to discovering the salary sacrificing which was going to affect about another 100,000 people—I do not know how many it will affect; I cannot find out. The Treasurer said that he was not aware of how many, but I think he was disingenuous because Treasury has done the modelling on these changes. Senator Bernardi and I were told this last Friday at the committee hearings. If the Treasury has done the modelling, why can’t the Treasurer and his ministers tell us what the impact of these expanded definitions of income are going to be? What is he holding back? Why is he holding back? If he is going to take income away from people in 2009, then surely they are entitled to know what they are going to lose. Why can’t I get an answer to questions I have asked half-a-dozen times at least? How many Australians will lose some or all of their benefits or assistance through the tax system as a result of the expanded definition of income? How much are they going to lose? How many of them are going to lose?

I will go through the programs that we have discovered, after much pulling of teeth, are going to be affected. They include—there could well be more but I cannot find out—family tax benefit part A plus family help income support payments; the childcare benefit; the baby bonus; the senior Australian tax offset, the Medicare levy surcharge; exceptional circumstance relief payments and exceptional circumstances interim income support; dependency tax offsets; income support payments under the Social Security Act; the parental income test on Youth Allowance; Abstudy; the Assistance for Isolated Children Scheme; Veterans’ Affairs support; the Commonwealth seniors health card; and dental benefits. That is going to amount to a lot of people. I can see the parliamentary secretary sitting there with a very worried look on her face, saying, ‘What am I getting myself into?’ I can assure you, Senator Stephens, that you have been handed the biggest hospital pass of your life.

Of these 16 or so affected measures, we also know, after last Friday’s hearing into this bill, that 22,000 Australians will lose eligibility for the seniors health card. I think Senator Bernadi enunciated that. And 18,800 will lose some childcare benefits as a result of the expanded definition of income. These figures are only two of the 16 areas but should cause significant concern. There are 22,000 senior citizens of this country who are going to get a letter in the mail in the next 12 months telling them that they will no longer get the seniors health care card from July 09. That means no $500 concession allowance, no discounts on pharmaceuticals, no telephone allowance and reduced access to bulk-billed Medicare services. I do not believe the government has done its homework on this. It certainly has not come clean with the elders in our community about the fate that awaits them just around the budget corner. Has the Rudd government come clean about the 18,800 who are going to lose childcare benefits? That is on top of the higher petrol costs, food costs and housing costs. Families are going to be slugged in their childcare benefits—unless they are older Australians, and then they are going to be slugged in their health care cards. They get it either way.

Is there more? Yes, there is more. I was told in estimates that these changes to income definitions will cost 74,400 Australians some of their family tax benefits A and B and 12,700 Australians all of their family tax benefits A and B. So there are cuts to childcare benefits, health care cards and family tax benefits A and B. But could there be more? Yes, there is more. There are a dozen or so other categories—we are still waiting for information on how many and how much, but the government will not tell us. I hope the parliamentary secretary will tell us tonight. She has always been someone who is prepared to tell the truth. They cannot say they do not know, because we have heard evidence from the families department that the Treasury has done modelling.

I call on the government, the minister and the parliamentary secretary again to produce the figures. Tell us how many more tens of thousands—or could it be hundreds of thousands?—of working families are going to be slugged due to the expanded definition of income to apply from July 2009. Are the envelopes being printed in massive forward orders to tell all those affected that they are going to lose some or all of their family tax benefit A, family tax benefit B, childcare benefits, seniors health care card, baby bonus, exceptional circumstances funding for drought, isolated children funding, teen dental services and so on? When are you going to tell the people how many of them are going to be affected and what the effect will be on them? They are going to have to tighten their belts, make allowances in their budgets or do something to offset the loss of income. If they do not, we will be returning to this place again and again to try, like today, to fix up the chaotic mess presided over by the Rudd government.

The Rudd government are good at watching. They have a FuelWatch, a ‘grocery watch’, a ‘strike watch’, an ‘Iguana watch’ and a ‘state debt watch’, and now there is a ‘budget watch’—that is, watch the budget roll out and watch the casualties line up. The Rudd government like to watch. They like to watch working families lose their benefits, their assistance measures and their tax offsets. Even their Veterans’ Affairs entitlements will be affected by these expanded definitions of income. The Rudd government are making it harder to access all these programs. I say in closing: you have been a great friend to the hardworking families of Australia!