Senate debates

Wednesday, 12 March 2008

Social Security and Veterans’ Affairs Legislation Amendment (Enhanced Allowances) Bill 2008

Second Reading

Debate resumed from 11 March, on motion by Senator Faulkner:

That this bill be now read a second time.

9:32 am

Photo of Cory BernardiCory Bernardi (SA, Liberal Party, Shadow Parliamentary Secretary for Families and Community Services) Share this | | Hansard source

This bill is an important but uncontroversial one. It is uncontroversial largely because it is a slightly modified form of the previous government’s election commitment. Once again, it is an example of the Rudd government’s ‘me too’ policy strategy. If imitation is the sincerest form of flattery then the Howard government indeed has a great deal to be proud of.

This bill increases the utilities allowance for pensioners to $500 per year. It extends the utilities allowance to other beneficiaries of pensionable age and also to disability support pensioners and people of any age on carer payments. The bill also increases the telephone allowance for pensioners, carers and disability support pensioners with an internet connection and provides an increased seniors concession allowance to $500 per person. At the cost of around $4 billion over the forward estimates period, some three million people will benefit from the passage of this bill.

We support these measures as, in the main, they were our policies and the government should be supported in implementing them. But I make a few observations. This bill recognises that carers and pensioners deserve our support—certainly they had it during the 11½ years of the former government—and that they are amongst the most vulnerable in our country to cost of living increases and limited external resources. This made the recent attempt by the Rudd Labor government to axe the lump sum bonuses to carers and pensioners even more heartless. So it is reassuring that due to the pressure applied by the coalition Mr Rudd has agreed, indeed copied, the coalition policy and last night further committed to maintaining these lump sum bonuses.

Of course there are some questions still to be answered but, notwithstanding this, the contemplation of axing the bonuses exposed the dark heart that lies at the very centre of this government. For days the government applied all sorts of linguistic trickery to avoid giving a straight answer on the bonus payments. The spin doctors tried to confuse the issue, but the public will no longer accept weasel words instead of firm policy. For a government that was committed to symbolism, this government’s message of the last five days has been very clear: ‘Let’s see what we can get away with and hope that the pensioners and the carers simply won’t notice’.

But they did notice, and the message will not be lost on them. The message I can take, on behalf of the coalition, to carers and pensioners across our country is this: they know the levels of support we gave them during 11½ years; they know we will not tire or resile from our support for them as some of the most vulnerable in our community. We will not let this government get away with trickery and we will support measures that support carers and disabled pensioners—anyone in receipt of a pension—to live a full and meaningful life. The opposition supports this bill and we commend the government for its rapid action and acknowledge the fact that these things can only be enacted so speedily due to the strong economy, but that anything that affects our strong economy will reflect on the level of benefits that we can supply. That is a caution for the government not to destroy the Australian economy because of the effects it will have on our most vulnerable and marginal.

9:36 am

Photo of Andrew BartlettAndrew Bartlett (Queensland, Australian Democrats) Share this | | Hansard source

The Democrats support the Social Security and Veterans’ Affairs Legislation Amendment (Enhanced Allowances) Bill 2008. As the Liberal Party speaker outlined, it is uncontroversial and provides beneficial assistance to millions of Australians—the vast majority of whom are in significant need of assistance such as this. But it is important at a time such as this to ensure that we do have some honest debate with regard to the issues we are talking about as we move into the budget. Once we remove the first few sentences of Senator Bernardi’s speech and he got into the rhetorical flourishes and all of the political point-scoring, we see why we have ended up in the economic situation we have today.

We have had this repeat line from the coalition and we have seen it through some of the media about the new government’s plan to ‘axe the lump-sum bonuses’, which is the phrase that Senator Bernardi uses. It is a simple fact that these bonuses are not there to be axed because they were one-off bonuses. The fact that they were one-off bonuses four years in a row shows how dishonest the rhetoric of the previous government became in their desperate search to buy voter blocs with each budget. For four years in a row they trumpeted their wonderful largess and kindness by handing out one-off—that was the term they used repeatedly, budget after budget—lump-sum bonuses.

It is a simple fact—it is there in the budget papers, or more accurately is not there in the budget papers—that this payment is not there to be axed. It was a one-off. It was a one-off last year as well. If the coalition was genuinely concerned about providing ongoing reliable assistance to Australians who needed it, such as carers, they would not have made it a one-off; they would have put it in the budget so that it was definitely there to be relied on by people year after year. This would have been in the interests of good economic management.

We have had all this rhetoric about how wonderful the economic management of the coalition was when they deliberately created this expectation, and we have now seen them fan this expectation that people would be entitled to receive so-called one-off lump-sum bonuses every year, but they did not put it in the budget. So you have got literally billions of dollars of expenditure that is not accounted for but that everybody is expecting to receive, purely because of the former government’s desire to paint themselves as some sort of benevolent hander-out of largess leading up to elections.

People do not want to say this of course, because anybody who stands up and says the lump-sum one-off so-called bonus payments are bad policy immediately gets labelled as uncaring: ‘You want to leave carers in the lurch.’ I do not; the Democrats do not. As I have said repeatedly in this place, if there is one group in the Australian community who deserve all the extra support they can get, it is carers. They relieve the rest of the community of an enormous burden by caring for people in the home. They do need extra support, so I do not begrudge them receiving it. But it is a simple fact that if you make that support an annual drip-feed that is not built in then you are always leaving them vulnerable to that being taken away down the track, whether for legitimate economic budgetary purposes or for political purposes. If the opposition had been genuinely concerned and had cared about ensuring that they got that extra support, they would have locked it into the budget year after year in an ongoing way rather than pull it out of the pocket as an ever increasingly tired trick every year and say, ‘Here is a one-off special for you’, four years in a row.

The other aspect that needs to be explored is whether, when we are wanting to provide extra support to carers, as we need to do and as the Democrats have repeatedly argued, so-called one-off so-called bonus lump-sum payments every year are the best way to provide that support. It is obviously the best way to make a big splash in the media. It is the best way to get people’s attention if they get a nice big bonus, and that is all good to try to get their support come election time. But does it actually provide the best bang for the buck, the taxpayers’ dollar, in providing support that is needed in a way that is going to be of most benefit to carers and is actually going to get best value for money? That apparently does not matter.

That sort of analysis has never been done, and one of the reasons it has never been done is that it has always been presented as a one-off, so-called, even though it has been four years in a row. This is the mess you get into when that sort of bad policy becomes locked in because of the short-term vote-buying desperation of the government of the day. I spoke about this on at least one occasion—I think on two occasions—when the so-called one-off bonuses legislation was being put through. A couple of times legislation to enable these bonuses was even called the one-off bill. The first time, in 2004, it was the Family Assistance Legislation Amendment (More Help for Families—One-off Payments) Bill 2004, to be followed on by the one-off payments to increase assistance for carers and other measures bill the year after. This is the sort of completely misleading language we got.

There are a couple of factors here that need to be emphasised. As I said in the chamber on at least one of these occasions, I am certainly not going to oppose extra support being provided for carers, but I do think it is important to step back from shrill and, frankly, exaggerated and distorted and sometimes dishonest populism. It is not just the coalition engaging in this; some in the media see the opportunity to create one of those controversies that gets lots of attention and gets lots of people concerned, and then they can all pat themselves on the back at the end of the week and say, ‘We stopped the government doing it,’ though it is something it might not have been going to do anyway.

The simple fact is that in many circumstances one-off lump-sum payments are not necessarily the best way to help people. They are particularly not necessarily the best way to assist in circumstances where we are trying to fight inflation. In a circumstance where there is inflation, extra support for pensioners, for carers, is all the more important—they need that extra assistance to help them deal with the consequences of inflation. But doing that by releasing large piles of money all at once does run the risk of having a sudden surge in demand, a sudden flood of money into the economy, and an extra likelihood therefore of a greater flow-on effect to inflation than would otherwise have occurred if it had been provided in a more measured way.

Where is the evidence that says that a one-off lump-sum payment of $1,500 or so is actually going to be best used and be of most benefit for the carer and, even more importantly, for the person who is being cared for, compared with, say, a $50 a fortnight increase spread out over the year with a much smaller lump sum once a year? Where is the research to demonstrate that this is the best way to help people? It has not been done, because that is not what the focus of it is about. The focus of it is about how to make a bigger splash. Here is a constituency, here is a clearly defined demographic: let us throw a big pile of money at them that they will notice and see if we can buy their support. It is that sort of electorally driven policy that created to some extent the poor economic management that we ended up seeing from the former government over a long period of time.

The other point that needs to be made is that bonuses did not just go to carers—and, as I said, if there is one group that needs extra support it is carers. I probably will not avoid misrepresentation because that is the currency of political debate in Australia but, nonetheless, to try to minimise misrepresentation I repeat that I believe extra support should be provided to carers. The fact that the previous government did not value carers enough to lock that extra support into the forward estimates in the budget is a poor reflection on them, but I believe that extra support should continue to be provided for them. I am not convinced that the best way to provide it for them is through one-off, lump-sump payments. I think it is completely appropriate for the new government to re-examine whether or not so-called one-off lump-sum payments, or even permanently entrenched lump-sum payments, is the best way to provide extra support, whether for carers or for anybody else. Let us see some research; let us see some evidence about that being the best way to provide assistance. So I do believe that that extra amount of money should be provided to carers and those they care for, but, on behalf of the Australian taxpayer, I would like to see it spent in a more effective way, a way in which there is better value for money—and, I might say, in a way that might have less of an inflationary impact, which is obviously counterproductive to what others are trying to achieve.

There are also a range of other so-called one-off bonuses, particularly to seniors across the board, that are frankly much less justifiable. The fact that all of us here are scared to say anything about that because we then get slammed with populist rubbish that we are trying to take money away from the mouths of pensioners et cetera means that this sort of bad policy continues. Undoubtedly significant groups in the Australian community who are not in most need have nonetheless received these sorts of one-off lump-sum payments in recent years and, as a broad group, seniors are one of those. Now undoubtedly there are significant groups within aged Australians who are suffering significantly and who need extra support but, in some cases, the support that has been provided has not been targeted towards those who most need it. It has been targeted towards those who are recognised as potentially the most valuable electoral demographic for the coalition.

So let us ensure that we use taxpayers’ funds—whether for carers, for older Australians or for people with disabilities—in a way that actually targets those who have the most need and not just have a grand, big bang, grandiose handout of money, as was famously noted last year, when we even had former Prime Minister Gough Whitlam receiving a bonus payment in the mail from the former government of, I think, $500 in recognition of his contribution to the country as an older Australian. I am sure he has made a great contribution, but it was a bit ironic, particularly given that Mr Whitlam is usually held out as the most economically irresponsible and profligate Prime Minister in history. But the previous government was so desperate to buy votes that they were handing out big cheques to anybody and everybody over a certain age group regardless of their income bracket. That is what we degenerated into, and we need to step back from that now and have a little bit of backbone to resist the populist, and frankly inaccurate, media campaigns that are waged from time to time.

I do not know what is planned by the new government. I certainly will always, whether inside this chamber or outside, continue to criticise them if they do not provide the support that is needed for Australians who are most in need. As I say repeatedly, carers are clearly just about at the top of that list for all sorts of reasons as people who are most in need and merit more and more support. But let us make sure we get value for money out of that and let us at least have a little bit of honest debate. Let us not just have these huge beat-ups months out from budgets that panic everybody in the community and lock governments into ongoing bad policy, which apart from anything else may mean that carers do not get the support in the most effective way possible. It is quite possible that the same amount of money could be spent to far greater effect for carers. For example, some of it could be spent on providing more respite hours, more relief for them; extra resources could be spent towards specific equipment; payments could be targeted towards and, required to be spent on, specific relief for the person being cared for; it could be spent in a whole range of different ways.

They are not one-off payments. Let us make it clear now that they have not been one-off in any real, honest sense of the word. Lump-sum payments are not necessarily the best in many of those cases. Certainly, in some cases—not for carers but in other cases—they have gone to people who frankly have not needed it. That is the circumstance we have got into. We do need to step back from the terrible situation we ended up in, where in some cases we ended up with not just a massive expansion of middle-class welfare; we actually started providing upper-class welfare as well, and we do need to start unpicking that. It does not in any way mean that carers should not get support—and I repeat that—but it does mean that we do need to start unpicking and unwinding some of the irresponsible approaches of the previous government.

Where there is a case for providing more support for a group in the community—and carers are definitely one of those—then let us lock it into the budget and not just do a so-called one-off year after year. If we actually do care about these groups—as I am sure we all do—let us make it reliable for them so they can plan for it and let us make it economically responsible for the country by ensuring that the expenditure is accounted for next year, the year after and the year after, rather than governments having to pull $2 billion extra off the budget at the last minute because of the need to continue to provide so-called one-off payments that are anything but.

It is a perfect example of how, as soon as you provide assistance to any group in the community, as soon as you provide any sort of payment, it immediately becomes seen as an entitlement and as something people should receive in an ongoing capacity. It does not matter whether or not you call it one-off. That makes it hard to withdraw. If there is any time when we should start trying to withdraw it, it should be now.

As I said, I am always going to be critical of whoever is in government when they are not trying to support the people who need it. But if the government are actually taking not only economically responsible but also socially responsible steps to redirect government expenditure towards those who are more in need in the community, then I will support them even if it does mean getting swiped by inaccurate populist rhetoric from some in the media or others in politics who want to falsely accuse me of not caring for the aged or not caring for carers. It is because I do care that I want to see public funds spent more effectively for them.

It is time that we put this debate back on a more honest footing. One of the best ways to do that is to stop using one-off payments and describe them as what they are and account for them as what they should be, which is ongoing payments—hopefully payments that are developed on the basis of research and evidence as providing the best assistance to people who are most in need.

9:53 am

Photo of Helen PolleyHelen Polley (Tasmania, Australian Labor Party) Share this | | Hansard source

I rise to speak on the Social Security and Veterans’ Affairs Legislation Amendment (Enhanced Allowances) Bill 2008. Older Australians are the lifeblood of this nation. Through their hard work, they have built our national prosperity. The Rudd Labor government will ensure that older Australians enjoy that prosperity, which they have helped to create for all of us. The fastest growing group of the Australian population is our older Australians. It is estimated that the number of Australians aged 70 or over will double over the next 20 years. It is for this reason that we must look carefully at the demographics to ensure that they are getting a fair deal. The Labor government, under Kevin Rudd, understands the cost of living pressures faced by older Australians and those on fixed incomes, like disability pensioners and carers. This government also recognises that, although self-funded retirees may be asset rich, many are cash poor. Spiralling petrol prices, food and grocery prices and housing costs mean older Australians, people with disabilities and carers are in real need of increased financial support. This bill will benefit over 1.7 million aged care support recipients, 250,000 Commonwealth seniors health card holders, 700,000 disability support pensioners and 120,000 carer payment recipients.

Firstly, this bill increases the annual rate of the utilities allowance from $107.20 to $500 per household and provides for the allowance to be paid in $125 quarterly instalments, rather than biannually. For the first time, this bill extends qualification for the utilities allowance to people who are under pension age and receiving a disability support pension, carer payment, wife pension, widow B pension or bereavement allowance and to people who are under qualifying age and receiving a service pension or an income support payment. I feel this is an important benefit, and I am sure it will ease the cost of living for seniors in my state of Tasmania. The bill also increases the annual rate of seniors concession allowances from $218 to $500 for eligible self-funded retirees and provides that the seniors concession allowance will be paid quarterly, with the same timing as the utilities allowance. Utilities and seniors concession allowance changes take effect from 20 March 2008. They will be paid every three months in $125 instalments. This means that payment will be made closer to when household bills are due, making household budgeting a little easier.

Lastly, the bill increases the rate of telephone allowance from $88 to $132 for certain income support recipients who have an internet connection at home. The increase will be available to pension age income support recipients, disability support pension and carer payment recipients and self funded retirees who hold a Commonwealth seniors health card. The bill also increases the rate of telephone allowance for all the people who have an internet connection at home and are eligible for a telephone allowance under the Military Rehabilitation and Compensation Act or the Veterans’ Entitlements Act. The Rudd Labor government understands that the internet is a critical means for families to stay in touch with their loved ones. Some Australians on income support pensions and payment can be at risk of becoming isolated from the community. That is why we are helping them stay in touch with their friends, children and grandchildren around the country and around the world via the internet. Affordable home access to the internet has the potential to connect them with the new world of communication and information.

The bill delivers on a key election commitment to help older Australians, people with a disability and carers to help them meet the costs of everyday living. The Rudd Labor government has committed over $4.1 billion to making ends meet. This shows how committed we are to helping our older Australians. The Rudd Labor government is dedicated to ensuring Australians are getting a fair go. For this reason, the government is investigating whether Australians are getting a fair deal at the supermarket. While the Howard-Costello government’s failure to act on 20 Reserve Bank inflation warnings has impacted on prices across Australia, the new Rudd Labor government wants to know if more can be done to ensure we have access to a competitive market for basic food items. Prime Minister Rudd has instructed the ACCC to take a broad approach to its inquiry and ensure that all aspects of the chain are included, from the farm gate to the checkout counter.

There are many in the community who will be relieved with our commitment to help them to make ends meet. I know that certainly in my home state of Tasmania these measures will be of great benefit to those who are eligible. These measures are just another example of how the Rudd Labor government has listened to the community and delivered a positive outcome. The former Howard government had the motto: ‘Whatever it takes, spend, spend, spend. Don’t worry about the economy; don’t worry about the impact on inflation—just keep spending and get yourself elected.’ The Rudd Labor government are showing that we have the good practice of listening and taking economic responsibility for any decisions that we make. I am pleased that the government have introduced these measures at this time, and I commend them to the Senate.

9:59 am

Photo of Carol BrownCarol Brown (Tasmania, Australian Labor Party) Share this | | Hansard source

I rise also to speak today on the Social Security and Veterans’ Affairs Legislation Amendment (Enhanced Allowances) Bill 2008. This bill honours the Rudd Labor government’s $4 billion election commitment to assist older Australians, people with disabilities and carers—some of the most vulnerable members of our community—to make ends meet. The government understands the increasing financial struggle faced by older Australians, people with disabilities and their carers when it comes to paying the bills and making ends meet. Like many other Australians who have been hit hard with rising petrol and grocery prices and increased interest rates, these people have been doing it tough. But unlike other Australians, many older Australians and those suffering from a disability rely on the support of others, including the government, for financial assistance. The Rudd Labor government recognises this.

Indeed, during the election campaign the Rudd Labor government recognised the need to provide further, sustainable long-term support for those in need, including older Australians, those with disabilities and their carers, as a priority. This is why during the campaign we announced a four-point plan to provide increased financial support to over three million eligible Australians to help them with the struggle of making ends meet. The plan included increasing the utilities allowance to $500, to be paid quarterly rather than biannually; $50 million to establish a national reciprocal public transport entitlement to ensure state government seniors card holders can travel at concessional rates anywhere in Australia; increasing the telephone allowance by 50 per cent, from $88 to $132 a year, to help with the cost of internet connection at home; and establishing a seniors internet fund to provide grants of up to $10,000 for 2,000 eligible community organisations to set up free internet connections for their members.

This bill begins the process of delivering on the government’s commitment in these areas. This bill delivers on our commitment to increase the utilities allowance and telephone allowances for eligible seniors, carers and people with a disability. It does so in several ways. The bill will operate to significantly increase the utilities allowance currently offered to older Australians receiving income support pension payments such as the age pension and veterans’ affairs service pension. This measure will see the current utilities allowance increase from $107.20 to $500, to be paid quarterly to singles and couples combined. This measure alone is set to benefit over 1.7 million aged income support recipients, 250,000 Commonwealth seniors card holders, 700,000 disability support pensioners and 120,000 carer payment recipients. I am sure that this increase, to be paid quarterly, will come as a welcome relief to many of those Australians already eligible to receive the utilities allowance. The Rudd Labor government understands the practicalities of keeping up with incoming bills, which is reflected in the decision to make the payment quarterly rather than biannually in a bid to assist in budgeting for such expenses.

In addition to this increase for those Australians already eligible for the allowance, this bill also extends the qualification criteria for the utilities allowance to cover people under pension or qualifying age and receiving a carer payment, a disability support pension, an invalidity service pension, a partner support pension, an income support supplement, a bereavement allowance, a widow B pension or a wife pension. This extension will ensure that even more Australians in a position of need receive extra moneys to cover their quarterly expenses. The bill also operates to significantly increase the rate of the seniors concession allowance, which is paid to self-funded retirees, from $218 to a total annual payment of $500 for each eligible individual. This will also be paid on a quarterly basis on the same days as the utilities allowance.

Finally, the bill also delivers on another of the government’s election commitments by providing a higher rate of telephone allowance to older Australians, carers and people with a disability if they receive income support and have an internet connection. The rate will be lifted from $88 a year to $132 a year for those that have an internet connection. The higher rate will also be provided to veterans and their dependants that have an internet connection at home.

The government recognises the importance of communication for older Australians and those with a disability to be able to stay in touch with family and friends. Contrary to suggestions by the opposition in the past week, these are not the actions of a government that does not care about older Australians and those most in need. I would suggest quite the opposite: the bill and its contents are the actions of a government that recognises the financial burden on many older Australians and people with disabilities and that is committed to assisting them to make ends meet.

The measures contained in this bill come on top of the Prime Minister’s commitment to guarantee the retention of the one-off bonuses paid to carers and seniors in this year’s budget and future budgets by placing them in the forward estimates, putting an end to unnecessary speculation and uncertainty in this area. This is the action of a government which is committed to establishing long-term financial security and support for the most vulnerable in our community to assist them with the ever-increasing family budget.

Our carers and seniors deserve to be treated with respect, and by making this announcement that is what the Prime Minister has done. The former government never provided certainty and never provided for carers and seniors into the future. The stark fact is that the former government did not have a long-term plan for our carers beyond the budget cycle. The fact that the carers and seniors bonuses were dependent on the economic circumstances of the time and the former government deliberately chose not to include them in the forward estimates is evidence of this.

The Rudd Labor government is committed to bringing to an end the lack of surety and genuine commitment shown toward older Australians, carers and those people with a disability by the opposition while it was in government. By guaranteeing the continuation of this payment as well as the introduction of the contents of this bill, the Rudd Labor government has shown genuine commitment to provide seniors and carers within our community with certainty for the future. It proves that the Rudd Labor government is committed to establishing financial certainty and spending habits to build for a sustainable future.

There are 2.5 million carers in Australia who look after family members or friends with a disability or other chronic condition. The contribution that carers make to our community is not denied by anyone in this chamber. It is estimated that carers save the Australian economy approximately $20 billion annually through unpaid work. We on this side appreciate, as I am sure those on the other side do, the work that seniors and carers do and the invaluable role that they play in our community. What the Rudd Labor government have done to show that we understand the stress and the work that they do is to provide certainty and security where the former government did not. They used the one-off bonuses as some sort of carrot for carers and seniors to beg for each year. This bill, and our commitment to retaining the bonus payment, proves the Rudd Labor government are 100 per cent committed to looking at ways in which to provide our carers and pensioners with greater financial certainty and security into the long term. This bill will see over three million Australians better off, and I commend it to the Senate.

10:08 am

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

in reply—I wish to thank the speakers who have participated in the debate on this bill. I note that there was a very positive contribution by all and I appreciate that. I particularly think that Senator Bartlett’s comments in this current debate were well made. There does need to be a sense of context and perspective about all this, and we need much more longer term certainty for pensioners and carers because they play such a vital role in our community. They need to be able to plan. It is hard enough to plan when you are on a good income but, when you are on a very low income, it must be extraordinarily difficult to plan for meeting everyday expenses. I know from my experiences in dealing with carers that they have enormous stress in their lives as it is, and they could certainly do without the sort of financial stress they are under. Certainly, part of that is to improve their conditions. I think the other part is to ensure that they have a bit more certainty about their income, as many of them live in very trying circumstances. In any event, I thank senators for their contribution to the debate.

Question agreed to.

Bill read a second time.