Thursday, 30 March 2006
Family Assistance, Social Security and Veterans’ Affairs Legislation Amendment (2005 Budget and Other Measures) Bill 2006
Bill—by leave—taken as a whole.
by leave—I move opposition amendments (1), (2) and (3) on sheet 4887:
(1) Schedule 3, page 23 (after line 10), after item 2, insert:
2A Clause 32 of Schedule 1
Omit the clause, substitute:
32 Income test
This is how to work out an individual’s reduction for adjusted taxable income:
Step 1. Work out the individual’s income free area using clause 33.
Step 2. Work out whether the individual’s adjusted taxable income exceeds the individual’s income free area.
Step 3. If the individual’s adjusted taxable income does not exceed the individual’s income free area, the individual’s income excess is nil.
Step 4. If the individual’s adjusted taxable income exceeds the individual’s income free area, the individual’s income excess is the individual’s adjusted taxable income less the individual’s income free area.
Step 5. The individual’s reduction for income is 20% of the income excess.
Step 6. Work out the combined income free area using clause 33A.
Step 7. Work out whether the total of the individual’s adjusted taxable income and the adjusted taxable income of the individual’s partner for that year exceeds the combined income free area.
Step 8. If the total of the individual’s adjusted taxable income and the adjusted taxable income of the individual’s partner for that year exceeds the combined income free area, the individual’s income excess is nil.
Step 9. If the total of the individual’s adjusted taxable income and the adjusted taxable income of the individual’s partner for that year does exceed the combined income free area, the individual’s income excess is the individual’s adjusted taxable income less the individual’s income free area.
Step 10. The individual’s combined reduction for income is 20% of the income excess.
Step 11. The individual’s reduction for income is the greater of the amounts calculated in steps 5 and 10.
(2) Schedule 3, page 23 (after line 10), after item 2, insert:
2B After clause 33 of Schedule 1
33A Combined income free area
The combined income free area is $250,000.
(3) Schedule 3, item 3, page 23 (lines 11 to 13), omit the item, substitute:
3 Application of amendments
- The amendments made by items 1 and 2 apply in relation to the 2005-2006 income year and later income years.
- The amendments made by items 2A and 2B apply in relation to family tax benefit for the 2006-2007 income year and later income years.
- The amount referred to in item 2B will not be subject to indexation on 1 July 2006, but will be subject to indexation in accordance with the Act for the 2007-2008 income year and later income years.
These three matters all relate to the question of income testing and the income-free area. As I indicated in my contribution to the second reading debate, Labor is moving these amendments to try to deal with our concern about the current arrangements in relation to family tax benefit part B. We supported the legislation and the movement in the thresholds for Australian families but we are most concerned that this particular payment is not means tested. So these amendments seek to put an income cap for payment of FTB part B on those families who earn more than $250,000 a year—that is, the payment would not be paid to families with incomes over $250,000 a year if Labor’s amendments are successful. On our estimates that would create savings of about $7½ million a year and would affect 2½ thousand to 3,000 families. They would be excluded from the payments of FTB part B.
The key point I want to make is that the FTB is not means tested. Traditionally in Australia over the last period, I think since Billy McMahon was caught out claiming the age pension, Australians have taken the view that welfare dollars, support provided by the government in the form pensions or allowances, ought to go to those in need. It ought to be on the basis that people receiving those benefits are those who need them. That is a principle that has been accepted by both sides of politics: welfare, social security, ought to be directed to those who are most in need and it ought to be means tested.
What we have with the FTB part B payment is, in my view, quite an obscene outcome. The situation is that, under this payment, millionaires and families on very high incomes can still be entitled to what is effectively a social welfare payment. It is just obscene. What these amendments seek to do is limit those payments to families in need. I picked the threshold of $250,000 purely to make a point, but it would probably be better assessed by a more rigorous appraisal. The point I want to make is that there is no defence for the Commonwealth, for Australian taxpayers, to be paying social security support to people of high wealth.
This has come about because the FTB part B is not means tested. Provided the secondary income earner—that is, the partner of someone on a high income—earns less than $20,000 if their children are under the age of five, or less than $16,000 if their children are over the age of five, they get some payment of family tax benefit part B. So we now know that in this country there are 70 families in which the major income earner is earning more than $1 million per annum, but some of them are receiving $3,300 in taxpayers’ funds in welfare. It is ludicrous and it is obscene—millionaires on welfare! Millionaires are being subsidised by working taxpayers in this country to the tune of $3,300 a year.
You have to ask yourself: how could we get to that situation? How on earth can we defend such a system? Why is this measure not means tested when we so carefully target a means test on all the other social security payments? We means test every dollar that a pensioner gets. Every time a pensioner, a single mum or an unemployed person earns a dollar over the threshold, we take some of that money back from them. We reduce their pension, and these are people on very low incomes. Age pensioners are on $13,000 a year but we pay the partner of a millionaire $3,300 in welfare payments. I would argue that that money would be better directed to the pensioners of Australia, who are living on very little income trying to make ends meet. It is just not acceptable that we have such disparity in our system.
The Prime Minister’s only defence for this proposition is that it is the same as providing a second tax-free threshold to the family for the effectively non-working partner, or to a partner who earns very little. That is actually not right. A second income earner in a family that earns more than a million dollars a year can still earn up to $6,000 a year without being taxed—that is, they have a totally tax-free area—and continue to receive a large proportion of family tax benefit B payment. So the Prime Minister’s defence is not right. There is no defence for paying welfare to high-income families.
We hear a lot from the government about mutual obligation and the scourge of passive welfare but in this case we pay partners of millionaires $127 a fortnight provided they do not look for work; their mutual obligation is not to work. So while the government talk about mutual obligation, getting people back into the workforce and encouraging workforce participation, they pay high-income families—people with a family income of over a million dollars a year—$127 a fortnight as long as they do not look for work; that is their mutual obligation. Their mutual obligation is to stay in Toorak sipping lattes and to ensure they are not actually out there in the job market. Provided they are comfortable in the coffee shops of Toorak or Vaucluse, they will continue to receive $127 a fortnight of taxpayers’ money, because they are meeting their mutual obligation, which is not to look for work. That is ludicrous.
Look at what the government is doing to single parents as of 1 July. Contrast that treatment of single parents with the treatment of high-income families. It is obscene, it is indefensible and it ought to be stopped. Single parents who come into the system from 1 July will actually have their entitlements to an allowance to support them and their families reduced by $55 per fortnight. So single parents on very low incomes supporting kids—having to feed, clothe and send their kids on school excursions—are going to get $55 less per fortnight under the government’s Welfare to Work package but the government will continue to insist that high-income families receive their welfare at the rate of $127 a fortnight. This is inexcusable.
I know from my own school primary school that a lot of families have trouble meeting the costs of excursions—people trying to raise kids and to give them an equal opportunity in life who cannot afford to pay the costs of excursions. At my school we have set up, through the P&C, a special fund to allow the headmaster to try to deal with this issue so that those kids do not miss out—and that school is in a relatively well to do area. These are families who cannot afford to provide their kids with what we would consider to be basic opportunities. It is obscene to see these people being paid $55 less per fortnight under the government’s changes to welfare while the government will not lift a finger to do something about the obscenity of paying high-income earners welfare.
We have been pressuring the government for a year or more on this issue and the government has refused to deal with it in any serious way. What message does this send to Australians when they hear that the government’s idea of equity is to permit this sort of situation to continue? It is completely indefensible. When you think of all the needs of people with disabilities, people who are unemployed, people on pensions and young disabled people who cannot get out of nursing homes because of the lack of public funding available, providing public funds as obligation-free payments to high-income earners, people who do not need the money, is sending completely the wrong message. It is indefensible and unfair, and it should not be tolerated in a society where we try to promote fairness. It certainly brings the whole welfare and income support system into total disrepute.
When you think of the way Indigenous people in this country are disparaged and referred to as receiving sit-down money and of the way the government goes on about disparaging those people, what I want to know is why the partners of millionaires are paid sit-down money. They are not sitting down in the dirt of outback Australia in communities without water, power and adequate housing. They are sitting down in coffee shops in Toorak and Vaucluse, collecting their taxpayer funds in the form of an obligation-free welfare payment. It is not good enough, and I urge the government to reconsider. The amendments are designed to encourage the government to end this practice, and I urge it to really reconsider its position.
The only two defences I have heard is it would cost too much to means-test this group of people and the argument that the Prime Minister uses about a second tax-free threshold, which, as I say, is completely wrong. If we can go to great lengths to ensure that families pay back debts as small as $50 to $100 in overpayments of family tax benefits and if we can go to great lengths to check what an old age pensioner might have earned in a part-time job and to make sure that they do not receive the full pension because of that income, surely we can ensure that people on high incomes do not receive scarce income support measures at the expense of those paying their taxes. So I urge the Senate to support the amendments.
I listened very carefully to Senator Evans. Senator Evans, unlike some of his colleagues, can run an argument and can generally run it in a more moderate and sensible fashion. Unfortunately, today was not one of those days when we can attribute those qualities to Senator Evans. To suggest that this is an obscene measure and that it brings the whole Welfare to Work process into disrepute is absurd. It is completely over the top. It fails to recognise the nature of the benefits that we provide to families. It fails to look at the whole area of how government policy across a broad range benefits families. I remember that in the old days one of the proudest boasts of the Keating government was that it cut the top tax rate to 60 per cent. One wonders whom the major benefits of that went too. I suspect that when you cut the top tax rate, a lot of benefits—surprise, surprise—flow to the very high income groups in this community. Senator Evans did not stand up—maybe he was not in the chamber; if he was in the chamber he certainly did not stand up—and complain about that.
We are talking about government public policy and how it benefits families: we are talking about a tax system and a welfare system. On the one hand, you say that your proudest boast is that the Keating government was able to cut the top tax marginal rate and then, on the other hand, you complain about these issues in relation to FTB part B, I have to say that, at the very least, you are not being consistent.
There was an error in the remarks you made. I have some briefing notes on that, which I will turn to. The way this government has given enormous emphasis to benefiting families is one that we are very proud of. We are very proud of the way that we manage this economy. What was really obscene was the very high levels of unemployment that existed under the Labor government. What was also obscene was a very low increase in real wages under the Labor government. What was particularly obscene was the way that the Labor government, in 13 years, failed to tackle the massive problems of Indigenous disadvantage. That was obscene. You can use the word ‘obscene’ in relation to those activities, but you cannot use it in relation to the measures that are before this chamber.
The amendments moved by the opposition are seeking to introduce a modified income test for FTB part B from July 2006, if a couple’s combined income exceeds $250,000. We do not support such an amendment. The key purpose of FTB part B is to provide extra assistance to single-income families caring for children. It is therefore not income tested for sole parent families. For couple families, FTB is available where the secondary earner has a low, adjusted income. The government considers that it is important to provide extra help to couples who choose to have one partner remain at home to care for children. A higher rate of FTB part B is paid to families where they are caring for preschool children aged under five. FTB part B has been especially designed to assist families who face both the normal costs of raising young children and the indirect cost of reduced workforce participation.
One purpose of FTB part B is to compensate single-income families for the fact that they have access to only one tax-free threshold. As Senator Evans knows, and I think he did refer to this in his argument, dual income families benefit from access to two tax-free thresholds. They also benefit from the lower rates of taxation applicable to their incomes of the graduated tax scale. The vast majority of FTB part B customers have incomes below the levels at which Senator Evans wants to means test this measure. I would make the point—
He agrees with me. I regret to have to say this, but we are seeing the old Labor class war. The Labor Party has to relate somehow to its grassroots. We had Mark Latham’s attack on private schools in the last election and now we have Senator Evans attacking the very popular and important government FTB part B measure. It might work well in the trades halls around Australia, it might even rate well on the diminishing Labor Party branches around Australia, but it does not relate well to the Australian public.
You would, all your colleagues here would and the vast proportion of all your members would. But I do not think that sort of trade is available to either of us. It is true that you managed to sneak home in Western Australia; you had a surprising comeback in the last two days. I would describe that as a very lucky election. Sometimes you are lucky and sometimes you are unlucky.
I think the general consensus is that, for reasons of which we are all too well aware, there was a reversal of positions in the last 48 hours of that election. It was a lucky election—and good on you. I am not complaining. I am not whingeing. Sometimes you win and sometimes you lose. The Labor Party is in desperate straits. Senator Evans’s remarks today illustrate that it is the same old Labor Party and it has a long way to go. You have to look at government policy overall for how we benefit families. This government has given a very high priority to families. Essentially, the vast proportion of Australian families vote for us because they know that we have delivered.
The people who vote for us say that, under 13 years of Labor, their real wages rose by one per cent; under the John Howard government, their real wages have risen by 14 per cent. They say: 13 years, one per cent; 10 years, 14 per cent. I think you need no other figure.
It is very faint praise because the benchmark is not set very high. Senator Evans knows of the serious problems that the Labor Party has. But let me just turn to what has been described to me as a ‘conceptual error’ made in the remarks by Senator Evans. Senator Evans argues that families can access a second tax-free threshold and collect FTB part B. Therefore, the argument is that FTB part B compensates single-income families for not accessing two tax free thresholds. I think that is a summary of Senator Evans’s argument. It is possible for a secondary earner and a couple to have an income above the tax-free threshold of $6,000 and still receive FTB part B. However, due to the lower income level of the secondary earner receiving FTB part B, such families would not receive the same tax benefit that is available to dual-income families from graduated tax scales. Therefore, I am advised, the amount of tax paid by the single-income family including those with incomes above $6,000 for the secondary earner would be higher than that paid by a dual-income couple with the same total income. I think, Senator Evans, the argument you have made is not one which, if you were to examine it statistically, would actually work.
I thought it was exactly the point. I mentioned to you what your argument was and you then nodded sagely. Then I said, ‘This is the advice that I have received.’ Then you say, ‘That’s not the point.’ I think it was the point. To cut it short, this has been an interesting debate, at least I hope so for some. The government will certainly not be accepting the amendments that have been moved by Senator Evans.
That the amendments (Senator Chris Evans’s) be agreed to.
by leave—I move Labor’s amendments (4) to (10) on sheet 4887:
(4) Schedule 5, page 25 (line 2), omit “Reducing allocation of child care places”, substitute “Allocation of child care places”.
(5) Schedule 5, page 25 (after line 14), after item 2, insert:
2A Section 206
Before “The Minister”, insert “(1) Subject to subsection (2),”.
(6) Schedule 5, page 25 (after line 14), after item 2, insert:
2B Paragraph 206(a)
Repeal the paragraph, substitute:
(a) procedures relating to the allocation of child care places to approved child care services, provided that such procedures:
(i) must specify that child care places may only be allocated if an application is received from a person able to provide approved child care services; and
(ii) must specify that decisions about the allocation of child care places are to be reviewed by the Secretary at least monthly;
(7) Schedule 5, page 25 (after line 14), after item 2, insert:
2C Paragraph 206(b)
Repeal the paragraph, substitute:
(b) matters to be taken into account in working out the number (if any) of child care places to be allocated to approved child care services, provided that the guidelines specify that the primary matters to be taken into account are the relative needs of:
(i) different areas of Australia for the kinds of child care places to be allocated; and
(ii) people in each area who have work, training or study commitments;
(8) Schedule 5, item 4, page 26 (lines 6 and 7), omit paragraph 207A(1)(a), substitute:
(a) that number has exceeded, for a continuous period of at least 12 months, the number of child care places provided by the service; or
(9) Schedule 5, item 4, page 26 (after line 25), after subsection 207A(4) insert:
(4A) If the Secretary reduces under this section the number of child care places allocated to an approved child care service, the Secretary must, within 7 days after the day on which the reduction takes effect, allocate the same number of places to one or more other approved child care services.
(10) Schedule 5, item 4, page 27 (after line 11), after section 207B, insert:
207C Details to be included in annual report
The Secretary must include, in the annual report made under section 232, details of
(a) the number and the location of child care services which have been subject to a decision to reduce the number of child care places allocated to them;
(b) the number and location of child care services which have been allocated places taken from other services; and
(c) the number and location of child care services which have applied for places or for additional places but not been allocated those places or those additional places.
As we know, the Family Assistance, Social Security and Veterans’ Affairs Legislation Amendment (2005 Budget and Other Measures) Bill 2006 gives the Secretary of the Department of Families, Community Services and Indigenous Affairs the power to take allocated but unfilled places from a child-care provider. The justification given to allow this new power is that it allows redistribution of places from areas of low demand to areas of high demand, and that sounds an eminently reasonable proposition. But unfortunately that is not what is going to happen. Because the child-care allocation system is so slow and unresponsive, centres and family day carers will have to wait for two years to get back places taken away from them forcibly by the department. The question needs to be asked: who will have the power to decide when to take places and when to give? The answer is the department. This is the same department that, because of policies of this government, admits that it does not even know where child-care places are needed.
Labor senators asked the following questions about this issue during the inquiry that was undertaken on this bill. How prepared is the department to deal with this new power? Do the bureaucrats in Canberra know more than individual child-care operators know about the demand for these services now and six months into the future? The answers we received were quite concerning. The department admitted that it does not have any way to measure demand at a regional level. It does not know how many places are currently being utilised; it has ‘some sense of the numbers’. It has not yet decided on a definition of ‘excess places’. In other words, the government has decided to propose a new power to take away from a provider child-care places that have been consistently unused, but it has not decided on what ‘consistently unused’ means. This parliament is now being asked to allow child-care places to be involuntarily relinquished by child-care providers, despite the government not knowing where the areas of high and low demand are, nor how long a vacant spot needs to exist before the government can arrive on the doorstep and take it away.
Labor’s objections to these changes can be expressed quite simply and include the fact that places removed from one service do not have to be reallocated to another service. The system for reallocating places is rigid and slow. Generally places are only allocated within advertised windows wherein services are invited to apply, and there have been fewer than five such windows since the year 2000. Child-care services often have to wait up to two years from the point of request for new places for those places to be allocated to them. Parents around the country might be without a child-care place simply because the allocation system lags behind the new demand, and the government’s ability to accurately assess unmet need for child care is poor. It admits—on occasions when it suits—that that is the fact.
Labor is moving amendments to rein in the secretary’s new proposed powers and to improve the system of allocation. The amendments that we have proposed will limit the secretary’s power to reduce the allocation of places to a service unless, firstly, it has been continually vacant for 12 months and, secondly, it will be reallocated to another service within seven days of removal. The amendments oblige the secretary to assess applications for additional places to meet demand from child-care providers throughout the year—and we propose every month—and not just in infrequent and unpredictable windows. Lastly, the amendments will require the government to include in the annual FaCSIA report to parliament information about the number and location of services suffering an involuntary removal of a place, information about services that have been reallocated those places, and services that have had requests for more places declined.
The Greens support these amendments. During the committee hearings, I was quite concerned to hear that there was not an adequate assessment process of child-care places being carried out, in particular in regional Australia, where I believe there is going to be a significant increase in demand, particularly as it relates to the new Welfare to Work legislation that has come in. Outside of that, the department really has no idea how many places are required in regional centres. It has no process for adequately assessing the demand in regional centres, and when I asked about what process is in place in other areas I was told that it mostly depends on requests from existing centres. I do not think this is an adequate way to be handling child care in this country. I believe that the Labor opposition’s amendments go some way to addressing this issue but, as we articulated in a minority dissenting report to the committee hearings, we believe FaCSIA needs to be developing a robust assessment process to allow it to model future demands for child-care places, particularly in regional communities. We also believe it needs to be doing a bit of forward planning to address these identified future needs. We will be supporting these amendments.
The government will not be supporting these amendments. I have listened carefully to the arguments that have been put forward. Senators who have spoken do not seem to understand some of the implications of the Labor Party amendments. One that has been drawn to my attention is that the proposed amendments would make a hypocrisy of the current voluntary relinquishment process. Senator Siewert, in practical terms, based on the amendments drafted by the opposition, the government would have to reject the child-care services’ voluntarily offered relinquished places unless we had an application for more from somewhere else. I think it just shows you the inflexibility of the amendments that have been proposed by Senator McLucas, which seem to have a rather serious unintended consequence. That is just one of the arguments why we will not be supporting the Labor Party amendments: they restrict the ability to redistribute places from providers that are not using them to those in areas of need.
The government does not accept the opposition amendments because they are counter to the purpose of the government’s provisions. The opposition amendments partially duplicate other provisions of the Family Assistance Administration Act. Prescription of administrative process is unnecessary red tape, in our view, in a sector that needs more flexibility, not less. To our mind, it is odd that the Labor Party would restrict the ability to redistribute unfilled places to areas of need when they often quite wrongly—I have been in the chamber when they have done this—claim that there is a child-care place shortfall. The substance of the opposition amendment is that funded places should remain idle for at least 12 months before they can be put to better use.
In that case, Senator McLucas is conceding that is correct. I would have to say, Senator, you may have trapped yourself. This is what in the sporting area we say is an own goal. The public would rightly expect that unused child-care places be allocated expeditiously to areas of demand, and the public in that case would be dead right. The opposition amendments would actually be a retrograde step over the current system of voluntary release and not improve flexibility, as is the government’s intent. Child care is about supporting parents and the carers they choose. I would have to say that parents seeking places for their children in areas of demand would be infuriated by Senator McLucas’s amendment, which would deny them access to places that are otherwise not being used. I do not know what Senator McLucas would say to those parents if this amendment was passed by the Senate.
Senator McLucas has at least conceded the substance of my arguments and the public will make a judgment. Senator McLucas says places should remain idle for 12 months; I say they should not. I say that places should be given to areas of need and they should not be idle for 12 months in areas where there is not the demand. It is a very straightforward argument. Some places attract overhead funding. In those cases, the ALP amendment serves to spend taxpayer money on some places that are not only unfilled but that, I regret to say, entrench potential waste for periods of over 12 months. The government’s measure is a simple mechanism to better utilise all available child-care places. The ALP amendment does the opposite; therefore, in good conscience, the government cannot accept the amendments that have been moved by the Labor Party.
I was not going to make another contribution but, unfortunately, I have to. I need to ask the minister, then: if it is not 12 months that the place is going to be vacant for, what is the period of time that the department is going to use for the definition of an unused place?
I think the general test of the department is not 12 months. The general test would be six months, a far shorter period. But the department is flexible. The department has the flexibility. Your arrangements would reduce the flexibility, and I think that is a pity. That is why we cannot accept them.
I will not labour the point but I have to say this sounds a lot like policy on the run. We asked that direct question in the Senate inquiry. We asked what the definition was of an unused place and the department was very vague. It had not been identified as yet. ‘It is more like six months.’ What sort of an indication is that to the sector? How long are you waiting for something to occur? This is not an arbitrary thing we can make up on the run. Let us be really clear about what the definition of an unused place is so that family day care providers in particular know what is going on. Is it six months, Minister? If it is, tell us. Is it six months in a regional place and two months in a city? What are the rules that we in this parliament are adopting today? It is unfair to family day care providers that we just pass this bit of legislation and will make it up later. I think it is only fair that we know what we are passing here today.
I think you do know. I thought you started off your remarks saying it was good to get a clear answer. I can just take that as a compliment that the question was put to me and I was able to give you a clear answer.
What is an unused place? A place which is not being used, I would have thought. I do not want to be too complex in this, but an unused place seems to me—and I am looking at my advisers—to be a place which is not being used. They are nodding profoundly.
The other thing I would say to Senator McLucas and to Senator Webber is: I think you should have consulted with the sector. That is what you should do. The department has consulted with the sector, and the six-month period is understood and accepted. It does seem a little bit ironic that Senator McLucas—perhaps with the best of intentions; I make no judgment but I assume it was with the best of intentions—has moved an amendment that simply does not make sense. It does not make sense to the public. Senator McLucas could not explain this to a parent who could not obtain a place because of the inflexibility of the Labor Party amendment. Senator McLucas, I am a senator, as you know, who tries to answer questions, one who tries to assist the debate, but I think that this is a bad amendment and it is one which the government will not be accepting.
by leave—I move opposition amendments (11) and (12) on sheet 4887:
(11) Schedule 6, page 29 (after line 7), after item 1, insert:
1A At the end of clause 16 of Schedule 2
(3) The Secretary may grant an extension to this period of up to an additional 40 weeks if the Secretary is satisfied that a person has a legitimate reason for delaying his or her application for carer allowance.
(4) Without limiting subclause (3), a legitimate reason may be that:
(a) the person may be unable to readily access relevant services or advice; or
(b) the person may have a medical condition that would prevent him or her from applying; or
(c) the person may have a psychological condition that would prevent him or her from applying; or
(d) the person may have caring responsibilities that would prevent him or her from applying; or
(e) the person was unaware of the carer allowance; or
(f) the person was unaware of his or her entitlement to the carer allowance; or
(g) the person was unaware that the allowance is not income or asset tested; or
(h) the person experienced a delay in having a disability assessment undertaken; or
(i) the person underestimated at an earlier date the ongoing needs of his or her child; or
(j) there was a delay in the diagnosis of the child.
(12) Schedule 6, page 29 (after line 9), after item 2, insert:
2A At the end of clause 17 of Schedule 2
(3) The Secretary may grant an extension to this period of up to an additional 14 weeks if the Secretary is satisfied that a person has a legitimate reason for delaying his or her application for carer allowance.
(4) Without limiting subclause (3), a legitimate reason may be that:
(a) the person may be unable to readily access relevant services or advice; or
(b) the person may have a medical condition that would prevent him or her from applying; or
(c) the person may have a psychological condition that would prevent him or her from applying; or
(d) the person may have caring responsibilities that would prevent him or her from applying; or
(e) the person was unaware of the carer allowance; or
(f) the person was unaware of his or her entitlement to the carer allowance; or
(g) the person was unaware that the allowance is not income or asset tested; or
(h) the person experienced a delay in having a disability assessment undertaken; or
(i) the person underestimated at an earlier date the ongoing needs of the person from whom he or she is caring; or
(j) there was a delay in the diagnosis of the person for whom he or she is caring.
These amendments have their genesis in recommendation 2 of the chair’s report from the Senate Community Affairs Legislation Committee inquiry into these bills. As you know, Mr Temporary Chairman, the chair of that committee is a Liberal Party senator and convention is in this place that it is the government of the day that signs off on a majority report. So these are government senator recommendations. The second recommendation of that inquiry said:
1.39 The Committee recommends that the legislation be amended to allow a discretion for the backdating of Carer’s Allowance for a period in excess of 12 weeks where:
(a) it would have been unreasonable in all the circumstances for a claimant to have made an earlier claim for the Carer’s Allowance, and
(b) a failure to backdate would occasion significant financial hardship.
Labor’s amendments here today put into effect the intent of the committee in making that recommendation. The amendments identify and put into effect the concerns that were expressed during the inquiry about the limiting of backdating provisions. During my speech in the second reading debate I identified a range of those, and they include the fact that most potential applicants for carer allowance do not know that the payment exists.
There is a very poor knowledge in the Australian community of the fact that we have an allowance called the carer allowance. Concerningly also, there is very little action either by the department of families or by Centrelink to be proactive and explain to people that they are potential claimants for carer allowance. Centrelink do very little work—in fact, they said no work—to try and match the data that they have, to try and identify those people who obviously receive care, because they are on a disability support pension or are an aged care recipient, and find out who is providing care to them. They do not try to link the fact that there is a payment recipient with the fact that obviously or potentially that person will have a carer. They do not even use the systems that they have in front of them.
There is very limited advertising done by the department of families to promulgate into the committee information about the fact that the carer allowance exists. We can spend $50 million telling people about the Liberal Party policy on industrial relations, but I do not think we spend $100,000 telling people who are caring for their children or caring for their elderly loved ones that they are entitled to a payment of $94 a fortnight. We will spend $50 million telling people that we will sack them after 27 March, but we will not spend $100,000 telling people that they might be able to get a bit of assistance to help them out with this caring role that has been thrust upon them.
As well as the fact that many people are unaware of the carer allowance, we know that many people think it is a means tested payment. Well, it is not a means tested payment. It is not income replacement; it is a payment in recognition of the cost of providing care. But no effort is made to tell people that in fact this is a payment that recognises the cost of care and is not means tested. We know from the evidence given to us in the inquiry that people who live in more regional and remote places find it difficult to access Centrelink offices, to access the systems that are there to support them. So we know that people who are geographically isolated will have more difficulty accessing the carer allowance.
We also know that the forms that are used to apply for this payment are so poorly designed that even the medical profession have trouble filling them in. I raised that during my speech in the second reading debate the other night. The forms lead the person who is completing them to the view that they need to make a medical diagnosis, and we know that for many, especially for newborn children, it will take a long time to diagnose what condition they in fact have. We had a story given to us during the inquiry about a child in a family that had already had a child with a disability and it took 18 months to diagnose what ailment the child had. It was only then that the parent applied for carer allowance for that child. That is a circumstance where the family was connected to the system and even then they waited until the final medical diagnosis was made before making the application. These are the families that we are trying to pick up with this sort of amendment so that discretion can be applied when there is a legitimate reason for the person not applying.
We know that when a family is faced with the reality that either their child or someone in their family has had a disability or illness diagnosed and that they have to contemplate caring for that person for the rest of their life, it is a very traumatic episode for that family. It takes that family some time to deal with it. We were told by a number of witnesses that families in those circumstances suffer a sense of denial. They do not want to come to grips with the fact that their child or loved one has a significant and severe disability that will require care for the rest of their life. Because they are in denial they do not do the thing that reinforces the fact they have this child with a disability—that is, fill in the form and tick the box to say. ‘I have to care for my child and I probably will not be able to go back to work.’ Of course they are not going to do that.
The amendments that we are moving today pick up on that. In cases where there is a real, legitimate claim they allow the secretary to backdate for the full 26 weeks for applicants for carer allowance (adult) and the full 52 weeks for carer allowance (child). Of the 42,000 people annually that are successful in receiving carer allowance, a huge proportion is fully backdated for carer allowance (child). There must be a range of reasons for that. I was quite astonished, though, that neither Centrelink nor the department do any work—none at all—to try to ascertain why it is that so many of these people do not apply in a timely way. We do not know why people do not apply in a timely way but we are going to cut them off anyway.
Some families with the child with a disability are going to miss out on nearly $1,900—money that will be well used for basic medical supports but also for changing the family home to accommodate the child with the disability. To a person, the witnesses to the inquiry said that that money would be well used. But this department and Centrelink do not do any work to try to find out why people do not apply in a timely way—but we are going to cut them off; that will be fine.
The other thing that annoyed witnesses to the inquiry was that in the lead-up to the last budget the government did what it usually does and talked with lobby groups—Carers Australia, the National Welfare Rights Network and a range of other welfare organisations—about the sorts of proposals they were contemplating in this budget. They talked about the good things that this government was going to do for carers. The carer organisations were quite happy to receive that information, but the government did not tell carer organisations about the sting—the fact that they were going to cut the backdating provisions for carer allowance.
The carer representative organisations feel that they have been dudded—that they have ticked off on the bonus payment that was being paid and a couple of other amendments that happened through that budget process but then they got the sting. This sting will not hurt those people who are current recipients of carer allowance; it will hurt a large proportion of the 42,000 people who will apply from 1 July. Like Welfare to Work, they have quarantined a certain group of people and will just hurt those people who will not even know they are being hurt. That is the way this government operates when it comes to the welfare sector.
I think these are sensible amendments. They are amendments that are supported in principle, shall I say, by the report of the Liberal Party members of the Senate inquiry. They are amendments that are practical. I think they are eminently supportable and I am sure that the welfare sector will see that this is a way forward. The other thing that these amendments will do is put the onus back on the department. If you do not want the bureaucratic trouble of people having to apply for a backdating outside the normal form process, then you get out there and start telling people about the fact that there is this thing called a carer allowance. You get out there and start working to make sure that people will apply in a timely way. Why do we not look up the list of people who are recipients of the disability support pension and write to them and ask, ‘Does the person who helps care for you get a carer allowance? They are probably eligible.’ Let us do some practical, sensible things to get people who are potential claimants into the system so we do not have this messy system of backdating, whether it be for the 12 weeks that this government is proposing or, as I am proposing because it is the right thing to do, to put it back to 12 months for carer allowance (child) and 26 weeks for carer allowance (adult). I commend the amendments to the chamber.
At the outset I indicate that the Democrats support these amendments. Later down the track the Democrats have an amendment to knock out this change of the government’s altogether. I believe that is the appropriate way to go. The evidence provided to the Senate committee inquiry in my view provided no grounds or justification for changing the current situation with regard to the length of time that carer allowance can be backdated after the application is first made. If that is unsuccessful, the best fallback will be for an amendment such as this. On those grounds the Democrats will support these amendments.
I should just clarify precisely what is being proposed here. The current situation is that people who newly apply for carers allowance are eligible to backdate that payment from the date of claim by 12 months if it is a carers allowance for a child or six months for a carers allowance for an adult where it is a sudden onset of the adult’s condition. The government’s changes in the legislation before us restrict the length of time the claim can be backdated to 12 weeks in all cases. These amendments provide the scope for backdating to be extended further than 12 weeks to as far back as the current length of time if the department is satisfied that a person has a legitimate reason for delaying their application for carers allowance. I should emphasise that, as Senator McLucas said, this is broadly consistent with the recommendation contained in the committee report and specifically signed off on by government senators and the committee chair, Senator Humphries. I quote paragraph 1.31 of the committee’s report:
The Committee acknowledges ... and considers that in a small proportion of cases, particularly those in which claimants are suffering particular hardship, there should be some capacity to provide for the backdating of the Carer’s Allowance over a longer period than 12 weeks.
It is there in black and white in the committee’s report that there should be some capacity to provide for the backdating of the carer’s allowance over a longer period than 12 weeks. I believe the capacity should be there in all cases where there is an eligible reason for it to be backdated, as currently exists in the law. The committee—the entire committee, I would suggest—clearly stated that there needs to continue to be some capacity to backdate the carer’s allowance for longer than 12 weeks. This amendment clearly does that.
I noted that the minister—I am sure quite genuinely—in speaking to the previous amendment about child-care places said that in all good conscience he could not vote for the Labor Party amendment because it was a bad amendment. Quite frankly, I cannot see how, in all good conscience, any government senator, and particularly those that are aware of this issue and the reality of what life is like for carers, could possibly do anything other than vote for this amendment. There are some members on the government benches who have a good record of promoting the interests and plight of carers. I urge at least one or two of them to stand up on this occasion and actually use the ability that they have in this circumstance to ensure that the interests of carers are protected—ideally, I would say, by supporting the Democrat amendment that is soon to be moved to eliminate this schedule of the bill altogether, but at least they could provide support for the amendment before us now.
I think it is clear, particularly for people from rural and remote areas, that there are quite likely to be circumstances where you are in a position of caring, whether it is for a child or an adult, and it takes a longer time for you to be able to put in an application for carers allowance—assuming you are aware of it. I think that to show no regard for that is unfortunate in the extreme.
I should take the opportunity while I am on my feet to ask the minister, when he responds to this amendment, to also give some details to the Senate about what the government is doing in response to recommendation 1 of the committee. Recommendation 1 does not require any amendments but it does recommend the development and implementation of an education campaign aimed at raising awareness of the availability of assistance for carers and, particularly, the existence of carers allowance entitlement. I think it is important. This was a clear point that was made time and again at the Senate committee inquiry by those people who live every day with the reality of life as carers or represent people in that situation.
There is no point having Senate committee inquiries hearing from people who are directly affected, hearing from the people who walk in the shoes of people who care for family members and hearing directly from those at the coalface who know what the reality is and who know what needs to be done, getting that unequivocal information and advice from them and then ignoring it. Nothing is more guaranteed to increase people’s cynicism about the political process than doing things like that, where you get people before you; they tell you in black-and-white, absolutely clear-cut terms about something that needs to happen; the committee recommends that it needs to happen; and then nothing happens. I think it is very important for the government and the minister to clearly indicate to the Senate and, through the Senate, to the public and those organisations that I am sure are following this debate—if not now, then reading the transcript later—what the government is doing in response to this clear evidence that has been provided.
I will take the opportunity now, in relation to this amendment—and also as a broad-brush statement on the later Democrat and Greens amendments—to emphasise again the current situation for people who apply for carers allowance. Carers allowance is not ‘carers payment’ or ‘carers pension’. It is not an income support payment. It is, as Senator McLucas said, an additional payment in recognition—a fairly small recognition, in some cases—of the extra costs of people who are caring for children or adults. It is $94.70 per fortnight at the moment, so it is less than $50 a week. It is hardly a massive windfall for carers in that situation.
According to the government’s own evidence, the changes will mean that each year there will be around 26,000 people who apply for the carers allowance for adults who will lose, on average, about $410 as a result of this measure, and some will lose up to $663. That is based on current values. It will also mean that 16½ thousand people who will apply for the carers allowance for children will lose on average $1,450 as a result of this measure, and some of them will lose nearly $1,900.
I suggest that would compare to what Senator Evans was arguing about earlier with family tax benefit B, which is $3,300 a year but gets paid to people even if their partner is earning over $1 million a year. The government has just voted to retain that situation, where partners of millionaires can get over $3,000 in family tax benefit B, but it is still willing to proceed with this component, which will take away nearly $1,900 from over 16,500 people who are working and acting as carers for family members. You could not get a starker example of the distorted priorities of this government and how it is focused on buying votes, not on using the social security system to produce the best possible and fairest social outcomes.
It should be emphasised again that this is not a normal payment. It is not a normal payment because it is not means tested because it is not an income support payment. It is a recompense for expenditure. It is also different in the sense that it does relate to the illnesses of other people—family members and children. As I stated in my contribution on the second reading, carer allowance (child) is the modern version of the old child disability allowance, which also had significant scope for backdating, for the same reasons. I will not go over in detail what I said in my speech on the second reading last night, but the evidence was quite clear—and, again, the evidence is provided, even for senators who do not have experience or engagement with carers—to the Senate committee, from groups and people who lived this experience, that when many people first realise that their child requires extra care they focus first and foremost on getting diagnosis and assessment. Senator McLucas gave an example. There is an example in the committee’s own majority report from the Australian Association for Families of Children with Disability. They gave an example of a child who was close to three years old before the carers were finally able to get a diagnosis of cerebral palsy from doctors.
I spoke yesterday about the growing number of diagnoses for children on the autism spectrum and how that particular condition is one that can take a long period of time to diagnose as it represents itself in many different ways. It requires significant variations in the amount and type of care that is needed to be provided by parents. I also say that, because of the uncertainty surrounding that condition in many cases and just what it is that the child has to deal with, it can be a time of great difficulty for parents trying to find out precisely what it is about their child that they need to get about—I hesitate to say, ‘What it is that is wrong with that child,’ because it is not an issue of seeing it as an illness that somehow or other needs to be recognised as such; it is just a different characteristic. Nonetheless, it is a difference that requires different and often extra types of care or assistance.
In some cases children with that condition can grow into adults who not only do not need assistance but also can have extra-special abilities. So it is an unusual condition, but it is still a condition that can require a lot of extra caring, particularly in those early childhood years. However, it is a condition that a lot is unknown about, and it is one which can mean a lot of time is taken before diagnosis is given. In those sorts of circumstances, for parents who are often unaware of the carers allowance payment or simply so focused on clarifying what is needed and what the situation is—and it can take a long period of time—to not then get that extra bit of recompense for what would already have been an enormous amount of expense, time and opportunity cost not only is miserly but also sends a very poor signal. It sends a signal to those parents and carers who are already struggling financially and emotionally that the government either does not care or, in some ways even worse, just does not understand and does not recognise that this is a need and, indeed, a growing need.
We have recently had statements from the new education minister about the importance of early education and more focused early education for children, which is good, at least in principle. To be saying things like that at the same time as actually withdrawing support for parents who are doing their best to try and provide that extra care for children in those early stages where it can make such a difference is flying in the opposite direction. As I said yesterday, this is the sort of miserly measure that you can possibly comprehend might happen if you have a razor gang desperately trying to find a few dollars here and there to fill in a massive budget deficit, but to be just taking away desperately needed support for carers in this country at a time when we have record levels of budget surpluses is simply inexcusable.
To pick up where Senator Bartlett left off, I cannot but help thinking—and I cannot blame carers or the people they care for—that this is an extremely mean-spirited amendment to the Family Assistance, Social Security and Veterans’ Affairs Legislation Amendment (2005 Budget and Other Measures) Bill 2006. We are not talking about a lot of money per person here—1,900 bucks. Let us look at some of the things that that sort of money would help pay for. It would help pay for supporting the person being cared for. It would help offset the costs of diagnosis, which in many cases are huge for families. It would help pay for transport, pharmaceuticals and nappies. It would also help pay for necessary modification to homes, because, when a person acquires a disability, in many cases modifications have to be made to their homes. So those people and the carers for these people can acquire huge costs in many cases.
So, we are not talking about a huge amount of money per person or per carer. I think the Access Economics report has probably been quoted a lot during this debate, but when you look at the value of the care that carers contribute to Australia annually—a $30.5 billion contribution to our community—I think that carers are justified in believing that this is mean spirited. I must admit I certainly believe it is unfair and I believe it is mean spirited.
The Greens are supporting these amendments believing they go some way to addressing our concerns but, as people would be aware from our amendments circulated, we oppose schedule 6 and we do not believe it should go ahead. But if this particular notion does go ahead we at least think discretion should be built in, so we are supporting the opposition’s amendments because I think that we have a responsibility to provide support for carers. As has been pointed out, this allowance is to just offset marginally the costs that carers incur looking after the people that they love and care for. You see that in many, many cases carers are in the lower economic areas and that they had to give up full-time work—sometimes they give up full-time work and take part-time work or they take work with less responsibility in order for them to provide care.
If you look at the submissions that came into the hearings, all the carers groups—all of them—raised concerns about this and oppose this. They were not consulted and I also believe it is disingenuous if anybody from government tries to put the point that groups were consulted. They were told about the changes and because the amendments in this bill, as we know, include some positive things people were, of course, supportive of the positive things—and then afterwards they saw the thorns hidden when they did more reading.
As I said, we in the community need to be supporting our carers, giving them as much financial support as we can and not causing them unnecessary angst as this would. As has also been articulated today, there are many reasons why carers do not immediately apply for carers allowance. In some cases it is because they think they can struggle on without support. They do not want to acknowledge that there is a crisis in process and it is only when they actually come to the crisis point that they look around for what support they can get. Here, as a community, we are going to be saying, ‘Sorry, bad luck. You missed the cut-off date, you missed 12 weeks. That’s just tough,’ because we are an uncaring society.
In this society we are supposed to be going for economic growth because then we will have a better society. What sort of society actually cuts off funding for carers after 12 weeks and says, ‘Sorry, you’ve missed out’? It used to be 52 weeks or 26 weeks—depending on whether you are looking after an adult or a child—but now we are saying, ‘Bad luck, we’ve decided to cut it to 12 weeks. You’ve missed out. If the person you care for acquired the disability a little while ago, well, you would’ve been due back pay up to 52 weeks but, because the person you’re looking after acquired the disability after 1 July, well, it’s bad luck. You’ll only get 12 weeks. Bad luck, you can’t modify your home. Bad luck, you can’t buy those pharmaceuticals or support the person that you’re caring for.’
I think it sends a really bad message to the people who are looking after the most vulnerable in society, because that is what they are doing: they are looking after people who need help, who cannot look after themselves, and they are providing that care at great expense to themselves—at great expense both financially and, as we have heard on many occasions, to their own wellbeing. They are often the people that also become sick and then worry when they cannot look after the people that they are caring for.
If you look at the submissions we received during the hearings, look particularly at one from Carers Australia. They point out that they believe that these amendments:
... will further disadvantage and marginalise carers. The 2003 ABS Survey of Disability, Ageing and Carers indicates that carers are over-represented in the lower household income quintiles. These carers were identified as being at particular risk of low wellbeing in the Australian University Wellbeing Index Survey 2005.
I put to you that they are going to be at an even greater risk of low wellbeing due to these types of amendments.
It is extremely disappointing that we even have to consider such amendments. As I said, in a time when we are supposed to be in significant economic growth we are penny pinching; we are penny pinching at the expense of the people who can least afford it and are most vulnerable, and I do not think it is a sign of a caring and decent society. We are not providing these people with a decent life. I think that they deserve that and they deserve all the support that we can give them, so we are supporting these amendments. But the Greens will be moving an amendment later to actually strike out schedule 6 and to not reduce the potential back pay at all—but we do support these amendments.
I thank senators for their contributions in this important debate and no-one doubts the sincerity with which people come to this debate. These are issues which all senators should be concerned about and the question is, in the light of all the considerations that have gone on, what is the best way forward? The government, of course, has made a decision in the Family Assistance, Social Security and Veterans’ Affairs Legislation Amendment (2005 Budget and Other Measures) Bill 2006 that the best way forward is to make a number of very important initiatives. I suspect if I was critical of some of my colleagues’ contributions listeners would think—even if we do not accept the facts as they outlaid them—there was nothing in this bill to benefit carers when, in fact, there is an enormous amount in this bill which will be of great benefit.
Let me summarise just some of the thoughts. The FTB part A lower income threshold will see some 400,000 families receive more FTB. I would have thought that was very good news and in all the debates I have not heard one of the senators mention that. The bill will help reduce FTB and CCB debts by improving the way the estimates are managed, and I think that is very good news. We have had a lot of debates on these issues in the parliament in the past.
The government recognise very profoundly the important role that carers play in our society, and we will continue to support them. The Australian government provided carers with direct payments—and I think this figure is interesting—including bonuses, totalling an estimated $2.2 billion in 2004-05. This is an increase of more than 175 per cent since 1999-2000. This is a very big increase in moneys paid to carers. However much our views differ on these amendments, I think we have to recognise that a genuine and important effort has been made to provide additional resources and assistance to carers.
Senator McLucas, we know that you have a great interest in this area. Indeed, I think the interest you have shown is appreciated by a lot of people. We agree with you that this has to be communicated to people. My colleague Minister Brough has indicated in the debate in the House of Representatives that there will be a communications strategy to make sure that people are better informed. I think that was the substance of one of the comments that you made. You made some comments about the forms. At this stage, I cannot judge the merit of what you said, but I have asked the advisers in the department to review the forms and see whether, in the light of your suggestions and experience, something can be done to deal with the concerns that you have. They will look very carefully at your comments and look at the forms. That provides a bit of a way forward on that issue that you raised.
Senator Siewert will be returning to the debate soon. Again, I think she shows a lot of interest in these issues and often makes very worthwhile contributions. I have to say that Senator Siewert very regularly attends estimates and committee hearings. That makes her quite unlike two of her colleagues Senator Bob Brown and Senator Nettle, who I have to say from my experience very rarely attend committee hearings—particularly Senator Brown. Her work and interest in this important area is certainly noted, and we listened carefully to the comments that were made.
I will go back to the Labor amendments moved by Senator McLucas, which relate to the backdating of the carers allowance. The government do not support these amendments. We regard the amendments as impractical. If passed, they would result in uncertainties and delays for applicants and those required to administer the act. The amendments go beyond the Senate committee’s recommendation. The committee limited itself to justifying backdating on the grounds of unreasonableness to have made an earlier claim and significant financial hardship. The amendments simply call for a legitimate reason. This is open-ended and far more than the committee recommended. That is the advice I have. The key purpose of the government’s changes is to standardise and rationalise the care allowance backdating provisions for adults and children. These amendments effectively maintain existing provisions. Current methods for assessing eligibility are based on functional ability or care needs. This removes the requirement for a final diagnosis for eligibility assessment and has introduced greater access to the payment.
The government is willing to keep the operation of the act under review. This will not be the last time these matters are debated in this chamber. Senator McLucas, as I mentioned to you, the substance of some of your remarks related to the need for an effective communications strategy. I might say that you made some unkind comments about government advertising. My only comment to that is that I suspect you apply the same rules to the Beattie government in Queensland and its advertising. I will look with interest to see what you have said on that matter, because the Beattie government is a relentless user of taxpayers’ funds for advertising and I assume you have made your in principle views known there. Senator, we are not arguing the point. There has to be a communications strategy here. It is important that there is one. We agree with you. Even more importantly, the minister agrees with you.
I turn now to the amendment to be moved by the Australian Greens regarding the carer allowance backdating. This amendment opposes the proposed backdating provisions for carer allowance due to commence on 1 July 2006 and contained in schedule 6 of the bill. The government does not support this amendment. The key purpose of the change was to standardise and rationalise the carer allowance backdating provisions for adults and children. This amendment maintains existing provisions. Prior to the introduction of carer allowance, the methods of assessing eligibility for care assistance for children relied on diagnosis. Current methods of assessing eligibility rely on functional ability or care needs. This removes the requirement for a final diagnosis for eligibility assessment and has introduced—again, I say this to Senator Bartlett—greater access to the payment. The amendments maintain the gap between the backdating provisions for adults and children. The current backdating provisions for adults are granted only as a result of an acute onset. That is the advice that I have received. Senator Bartlett also spoke about the recommendation in the report which related to the communications strategy. I think I have dealt with that particular matter in my earlier remarks to Senator McLucas.
I do recognise that the Senate is trying to get this legislation dealt with, but I do note that it has been very difficult for the minister to defend the policy of taking $1,900 away from a person who has just been diagnosed with having a child who is going to require care for the rest their life. It is difficult to defend taking $600-odd away from a person whose husband has just been diagnosed with multiple sclerosis. It is pretty hard to make the argument that that is a good policy or that that is a good thing when, in the same piece of legislation, we say, ‘It’s okay to allow a partner of a millionaire to get a payment from this government of $3,300 per year.’ There has to be a question of equity in the fact that those three measures appear in this legislation. How fair is that?
The minister says that the purpose of this is to standardise and to rationalise this payment. Those words do not work on people who are caring for children. They do not care about that; they did not want to be standardised. Well, maybe they would—maybe if their child could be standardised and so they did not need to spend the rest of their life caring for that child it could be a good thing. But you cannot do that. And to say to someone: ‘We’re going to standardise your payment, because then it fits neatly into the system that we operate as a government, and in doing so we will take away nearly $2,000 from you,’ is just not fair. So, Minister, it is hard to defend. I do acknowledge that, and I think you have acknowledge that in the tone that you have brought to this debate.
I am interested to know that the minister has said that he will undertake a communications strategy. I wonder if you could undertake to the Senate to table the proposal for the communications strategy within a reasonable period of time. Maybe you could indicate what period of time that would be. We would like to know whether it is going to be $50 million, like this government spent telling people what the Liberal Party policy is on industrial relations. Maybe that is a good thing we could do with $50 million. Or maybe we could just give it back to carers because of the $35 million saving every year that this government is going to take out of carers’ pockets with the passage of this legislation.
The standardisation and rationalisation inherent in this measure do not recognise the nature of the payment. It is not income replacement; it is a recognition of the cost of care. That fundamental difference is the reason the backdating has always been far more generous than for other income replacement payments, other pensions. The minister does not get it. You just do not understand that it is a different type of payment. I urge the government, and I particularly urge those senators who signed off on the report that essentially recommends this amendment, to have the courage to do what they know in their hearts is right. And that is to vote for the secretary to have some discretion when the secretary finds out about these dire circumstances: the fact that people did not know the payment existed, the fact that they waited for the child to be to diagnosed, the fact that they thought the payment was going to be income and assets tested, the fact that they live so far away from a Centrelink office that they could not get there. All of these reasons, we know, are reasons why people do not apply in a timely way—and yet we are not going to allow for a discretion to be exercised so that those individual families can have a little bit of support. It is not a lot of money that we are talking about, but we are going to take away from them. This is a sensible amendment and I commend it to the chamber.
Senator, I think this is an important debate and it is about a very important issue. I have tried to avoid making too many heavy political points in this debate. We can all talk about government advertising and carry on there, but I just always note that Labor senators who seem to object to Australian government advertising never seem to object to state government advertising. It was an obvious point to make, Senator, and I think it was unfortunate, because I actually do think that you bring great interest and passion and expertise to this debate. I do not think you need to stoop to rather cheap political points. The fact is this government, through its carer allowance, has been able to very significantly increase funds to carers. You may have issues with the backdating, but it is quite wrong to suggest that this government does not value carers. It is quite wrong to suggest that this government has not increased funding to carers. I think it is a pity that you made those points in the way that you did. It is not the style that I think should come to this sort of debate.
The final point I make is on your question: would the communications strategy be available? That is a matter for the minister. But I have to say I am looking forward to estimates, and I am sure you will be pressing me closely on this issue.
The Democrats oppose schedule 6 in the following terms:
I just note the Democrats amendment and also the Greens amendment, which is identical, opposes schedule 6. I will not go over the whole issue again. We have basically been dealing with the substance of this debate in conjunction with the previous Labor amendments. To clarify, the Labor amendments were to enable a discretion for backdating to go for longer in certain circumstances. The Democrats’ preferred position is to keep the situation as it is. There has been no argument put forward, either here today by the minister or, during the committee hearings, by the department, that gives any rationale—beyond this being a simple savings measure—that could possibly justify what the government is doing here.
We have just heard the words—and the minister used them again—that the intent here is to ‘standardise’ and ‘rationalise’. It is typical bureaucrat-speak used to put a thin veneer of harmless-sounding intent over an action that will actually take money out of the pockets of carers. It is not even particularly accurate, I might say. It does not standardise it in the sense of making it the same as most other social security payments. All it does is standardise the carers allowance child and carers allowance adult provisions in regard to backdating. It does not standardise it with any other payments. So even that inadequate explanation is not particularly accurate.
The minister has also said, with some justification—it is the closest they have come, I guess, to some justification—that it does, to use his words, open up the payment to more people because eligibility for the allowance will be determined by the application of the child and adult disability assessment tools, which look to care needs and functional ability rather than a specific medical diagnosis. I certainly hope that is communicated accurately to all of the people who need to know about it. I am not sure that it will open up the payment to more people. But it may make them eligible sooner—that is true. The simple fact is that this is a savings measure that is estimated to save the government $35 million. If it is saving the government $35 million, it will be $35 million that carers were going to get that now they will not. So talking about opening it up or making it available a little bit earlier is clearly misleading if it is suggested that that mitigates what the government is doing. Otherwise, there would not be anticipated savings of $35 million.
To very briefly recap, we are talking about a payment that is $94.70 a fortnight—less than $50 a week. As Senator Siewert emphasised, and as detailed in our additional comments in the committee report, Access Economics, who are not usually pointed to as a bunch of bleeding heart leftie economists, have estimated that carers contribute $30.5 billion worth of care to the Australian community. Whilst I acknowledge what Minister Kemp said about the government’s payments in the area of carers, it is nothing compared to what carers contribute to the Australian community.
I emphasise that when we talk about backdating, particularly with extra care for children—and not just those with significant physical disabilities and things which are more clearly diagnosable, although it obviously applies there—we must recognise that parents often provide extra care for them in those early childhood years and undergo extra costs for quite a long period of time whilst trying to discover what the specific situation faced by that child is and what, therefore, the long-term consequences may be.
I also emphasise that in many cases with many conditions or behaviours that children may exhibit you are looking not just at needing to go to a GP and get a diagnosis but also at getting assessments by specialists—and not just medical specialists but also other types of medical and health professionals, like occupational or speech therapists or other sorts of specialists. You are potentially looking at therapy sessions, particularly for children who may potentially be exhibiting learning difficulties, pervasive developmental delay or, as I mentioned earlier, children whose behaviour may be on the autism spectrum.
In many of those areas there is not a lot of support available for children or their parents who are in those sorts of situations. There is not a lot of assistance available through Medicare, for example. Most of this is not covered by Medicare. Most of these things are not covered in the school system either, certainly not in the public school system or in most private schools. So you are looking at significant amounts of extra costs. If you want to provide the sorts of therapies, for example, that are provided for children who are suspected of being on the autism spectrum, there is a quite significant extra cost and they are often even hard to access. For people in regional, remote or rural areas, it is hard to even access them, let alone afford them.
Those are the sorts of things that parents are focused on with their children. They are not focused on immediately saying, ‘This is good. I might qualify for a payment. I will go down and get it straightaway.’ They are focused on the needs of their children and it can take a long period of time. Frankly, that is why the child disability allowance, going back to at least the 1980s, had backdating provisions longer than other payments. It is for precisely those reasons: because the extra level of care could already have occurred for quite a period of time before the situation is recognised as one that will be ongoing and people therefore then look at whether or not there might be a payment like the allowance for them to claim. That was the rationale for it.
The fact that the eligibility provisions look to care needs and functional ability rather than a specific diagnosis might slightly mitigate that, but only slightly. It does not go to the core of it. The unacceptable fact that this amount of money will be taken from the pockets of carers at a time when they are quite likely to specifically need it not only puts them at a financial disadvantage but also sends a message that there is a lack of recognition of what is involved in these circumstances and what people in the real world are going through and will continue to go through. I think that is a negative message.
I note with appreciation the strong and ongoing support that well-known broadcaster Alan Jones has shown on carers’ issues. I do not always voice praise about some of the things Alan Jones says, but I know he has spoken about this area and I think he is spot-on. I believe one of the reasons that he is strongly committed to this area is that he knows what the reality is for many people: how difficult it is in the real world for people who are caring and people with young children who are only slowly realising that they may be caring for them for a long time. There is a growing recognition of the need to give as much as possible for early childhood assistance and we need to provide more resources in that regard. This is potentially a backward step and certainly reflects a message that is at odds with some of the other messages about the need for more focus on assistance in early childhood, particularly for those children who have different needs.
The harder we make it for carers, the more people there will be who will struggle and the more people there will be who just will not be able to provide the sort of assistance that is needed, particularly for children. In that case, I would also suggest that that actually makes measures like this a false economy. It might in a narrow sense save $35 million for the bean counters who are looking at the column item in this particular department under this particular payment but, if you look at the longer term flow-on costs of making life harder for carers, I think there is a good argument to say that it is potentially a false economy and the costs may well outweigh the meagre savings that are involved.
I make a final plea: it is within the power of any individual on the coalition benches in the Senate to ensure that this measure does not go ahead. It only takes one or two of them to show that individual commitment to this issue. I would suggest that this is one issue that certainly merits that extra piece of commitment to carers. This is a time when I believe it is merited for an individual coalition senator—a Liberal or a National Party senator—to vote along with the Democrats to remove this section from the legislation and ensure that that little bit of extra assistance that can be provided to carers is not lost to them.
The Greens, as people would be aware, had the same amendment that Senator Bartlett has just moved. I would like to speak to that amendment relatively briefly because I did make a fuller statement earlier. While there may be some other positive initiatives in this bill, you do not give with one hand and take with another. Yes, carers may benefit from some of the provisions in the bill—the same as a great many Australians may benefit—but, on the other hand, we are taking away from carers. So the government is basically giving with one hand and taking away resources with another.
This government seems to have prided itself on promoting policies that encourage people to help themselves. However, in this instance, people who do help themselves and in fact others—carers supporting those in their charge—seem to be being discriminated against. They seem to be being penalised by having the back pay provisions taken away. So while other members of the community are encouraged to help themselves, people who are helping themselves and others are being penalised.
As I articulated before, carers in our society are helping those who are in most need and are most vulnerable. By doing that, they make themselves vulnerable. As I said earlier, many of them drop full-time work or add their care on top of their work responsibilities or go to part-time work and then care for those they are caring for. They deserve the most support that our society can give them. Unfortunately, schedule 6 of the bill does not do that. As I said before, it seems absolutely mean spirited that as a society we cannot afford to give carers this small amount of money. When it gets down to per carer, it is a small amount of money that we are now taking away—but these carers make that small amount of money go a very long way.
Overall, this sends a really bad message to carers: that we do not value what they are doing and the care that they are giving the most vulnerable in our community and that we also disregard the financial value of what they do. So not only do we not appear to be valuing the emotional component and the care that they are giving but also we do not appear to be valuing the contribution that they make to our economy, which, as I said before, is around $30.5 billion. With this section we are saying, ‘We don’t value that. We’re not even going to give you back pay to help you deal with the section of your life where you are often in one of the biggest crises of your life. We are not going to acknowledge that it is difficult to deal with and that it is a really bad time in your life. We’re not going to give you space.’ We are saying to them, ‘You have to do it within 12 weeks of the immediate crisis happening and you coming to terms with a new life’—and in many cases it is a new life. We are saying, ‘You’ve got 12 weeks to do it; after that, it is bad luck. You’ve missed the point; you’ve missed the mark; you’re not up to speed—bad luck.’ I think that sends a really nasty message to carers.
The Greens do not think that is appropriate. We do not think that we should be sending such a depressing message to the carers of Australia. As I articulated before, we think it is unfair. As a community, we can afford to provide this small amount to carers. I do not think anyone can argue that we cannot afford this. We cannot afford to send this message—because it is not just a financial message that we are sending. We should be sending a message of our support and caring for carers. I strongly support this amendment and believe very strongly that we should be removing schedule 6 from this bill.
I listened very carefully to the contributions from Senator Bartlett and Senator Siewert. I think Senator Bartlett was the substantial contributor on behalf of the Democrats and the Greens, and I would like to acknowledge that, as usual, he spoke with great sincerity and conviction, which is something that I appreciate about Senator Bartlett’s contributions in this place.
I would like to note two positions put forward by Senator Bartlett. The first major point that he made was that the effect of the Democrats and the Greens amendments is similar to the effect that was sought by the ALP amendment, which was dealt with rather conclusively by the Senate a few minutes ago. I appreciate that there are differences in terms of the way that the ALP amendment and the Democrats and Greens amendments go about the business but basically you are changing the impact of the schedule as it stands now or, in the case of this amendment, the schedule is being done away with all together should this amendment be successful.
That was one thing I noted. The other thing I noted was that Senator Bartlett and Senator Siewert just a minute or so ago contended that Minister Kemp’s remarks did not address the issues we are debating at the moment, and that his remarks were unconvincing. I would like to say that I listened carefully to Minister Kemp’s remarks, and I must admit that I found them highly persuasive—so much so that if I reiterated them it would be unnecessary repetition. So I stand by—and I think everybody on this side of the chamber would stand by—Minister Kemp’s remarks, and I urge the Senate to proceed with further consideration of the legislation before us.
That schedule 6 stand as printed.
Bill agreed to.
Bill reported without amendment; report adopted.