Senate debates

Tuesday, 18 November 2014

Bills

Social Services and Other Legislation Amendment (Seniors Supplement Cessation) Bill 2014; Second Reading

5:13 pm

Photo of Claire MooreClaire Moore (Queensland, Australian Labor Party, Shadow Minister for Women) Share this | | Hansard source

Because of some confusion we have had in this place on previous occasions, I thought it was important that I put on record immediately what our position is: we are opposed to this legislation. Just so no-one gets any confusion, as we have seen in the past, we are opposed to this legislation. We have made it clear for several months now. In fact, we made it clear from when the budget came down that we were opposed to this piece of legislation. There are a number of reasons for that.

I think possibly the core reason for why we oppose it is because we do not think it is fair at this time to make this decision because of a whole range of reasons. Central to that—I am sure you have heard it and you will continue to hear it—is that this is a cut that was not known to the community, the community that had been led to believe that there would be protection and that there would be no cuts of anything to do with pensions. They were told that in public places. They were told that in leaflets. And we know that that is not true. In the case of this particular payment, it is one that our government brought in in 2009-10. It was a part of a range of changes to legislation around the age pension in this country of which we were very proud.

That came after many, many years of lobbying from people across the community who were talking about inequities in the way that pensioners were looked after in our community. They were saying that there should have been a government response to what they felt—and could produce evidence for us, very personal evidence. I think everybody in this chamber probably had visits from and meetings with pensioners and people on DVA pensions. They were coming to see us and they actually had a very successful campaign, which was looking at us and saying they expected more from their government.

And we delivered. In 2009-10 we introduced a range of increases to the aged pension. We also ensured that there were variations on the options for the way the aged pension could be assessed for their increases. Amidst that, we introduced this particular supplement. It was a supplement that was rolling in payments that had previously been made, that were already in the system, and actually addressed a particular claim that was brought to us by people who are ageing—particularly for those people on limited incomes, particularly people on superannuation pensions and DVA pensions, the Commonwealth healthcare card holders, people who were eligible for the Commonwealth healthcare card, which is something that I know is held very dear by very many people in the system—that their income or assets or their particular situations meant that they were not eligible for the aged pension because of the tests that were in place, but they were still on quite limited payments. In fact, now it is on people who have incomes of less than $50,000 a year and who are eligible for this Commonwealth healthcare card.

The Commonwealth healthcare card then gave you eligibility, if you chose to take it up, for this particular supplement. The supplement now is worth almost $900 to an individual pensioner, and for married or partnered pensioner couples, if they have income or earnings under $80,000, they are able to get a payment in this process. We are not talking wealthy people. In fact, one of the things that has come out consistently in our work, and we do acknowledge this, is that there are some people who are very well-off in the community who are still able to access the social welfare system. We do not support that. We believe that our social welfare system should be transparent, it should be focused and it should be looking at the people in the community who have particular needs.

We believe that this supplement fits those guidelines. We believe absolutely that this money, which is paid quarterly in a lump sum, meets a need that has been identified by the community and accepted by the government and the Department of Human Services. So the process is that people get their lump sum quarterly. They like receiving the lump sum arrangement because that actually meets when they need to go through a particular process of paying a bill: they get an account; they are able to have a lump sum on which they can draw. That is the background to the payment.

What this government has done is—it came in on a promise that there would be no effect to the pension. It believed that the community would accept this budget, despite the fact that it broke that promise. And the way it went about talking to the community—and I think this is the thing that was most frustrating for me during this process—was like it felt that if it told pensioners or people who were able in this case to receive the supplement, who were not pensioners but were able to receive the supplement, over and over again that they were not getting a cut, then they would believe it. We saw that with the process around the change in the indexation rates for pensions, which has caused an enormous response from people in the community and organisations who represent people who are ageing in the community. These people feel that not only have they been betrayed, not only have they lost entitlements, but they also feel as though they have been treated without respect and almost as though they are not intelligent because they have been told consistently that there is no cut to the pension.

In fact, we receive that information regularly. We certainly received it in Senate estimates, where we had extended questions put forward by government senators to point out that in fact there will be a pension paid and that that pension will be increased. And no-one argues with that. What they do not accept—and they try to put forward the argument that we are too unintelligent to understand—is that at the moment the way the indexation rates operate for pensions mean that there is an option in the way pension rates are calculated and it gives people, determined by the government, an option at what rate the pension will increase.

The government have removed that. It is in their budget; it is written in their budget. No-one can be confused by it. It says in the budget that in the future it will be CPI. So that is taking away a provision that we brought in and maintained in 2009-10 where people can see and understand what their pension would increase by as they looked into the future. They could make plans around that; they could put together their propositions for how they would live—their expenses and how they would make plans for their futures based on an expectation that, should they continue to meet the eligibility rates for the pension by the assets and income tests that are there, should they meet those eligibility rates, they would expect their pension increase to rise to at least the CPI, but at a higher rate if it meant that there were the propositions for how the model would work for doing that.

The government have taken that away as a budget saving, and have actually said—and this is the other thing: the government have made no attempt to hide that this is a savings measure. And even with my lack of economic skills, I understand that if you are going to have a savings measure, that means money is taken away and brought back to the government, not to the community. So as a savings measure, they know that this change is going to reap savings, but they have consistently said to pensioners: 'No, your entitlements will not change. They will not change at all.' And yet the clear modelling is there, it is public; seniors organisations have done it. There is an expectation that pensioners will lose up to $80 a week over a 10-year period—and they understand that. They have not been confused. They have not been misled by the government consistently saying that there has been no change to their entitlement. They know that they will have less in their pockets than they would have if the change had not gone through. Complementary to that is the legislation we have before us today.

They were told—people on pensions, people who are ageing, people who are receiving DVA gold cards—that they would not receive any reduction in their entitlements, should there be a change of government; they were told that. They actually believed it and then, in the very first budget, along with a range of other proposals that were brought forward, the government looked at reducing entitlements to a whole bunch of people in the community, not just the ageing. This budget is renowned for its ability to attack everybody in the community who had been expecting some form of social welfare support.

We have families. We have young people who are without work. We have older people who are seeking work and, in this case, we have people on limited incomes with an expectation that they would receive the supplement they had been receiving for several years and which they had built into their budget. They had made plans according to the way they expected the system would operate. Without warning, in very quick time, it has been taken away.

At the same time, the federal government decided that they were no longer going to invest money in the Commonwealth concession program, which is a complementary program engaging both the state and federal governments for very much the same group of people—people who are on Commonwealth health care cards, people receiving gold cards, people receiving the pension. At the state government levels, across the states and also at local government levels, this gave them some concessions at the local level. This was not fully funded by the Commonwealth—we know that—but a Commonwealth allocation went into the bucket that was topped up by the states that allowed them to afford those concessions.

Again, not only were there people in the ageing community unaware that this was going to change but the state governments were also unaware. There are continuing discussions, I know, between the state governments and the federal government about how this will operate. Some state governments have said absolutely they cannot continue the concession arrangement if they do not have federal government support; others are looking at short-term maintenance, because they have recognised that people have been deeply traumatised by the impact of this change. The relatively small but nonetheless important contributions to a pensioner's income and personal wealth of concessions on things like motor vehicle insurance, energy and communication costs are of such import to these people but it appears that the government has just not understood.

Certainly what the government has not done is listen because, by talking to the people who have come to me and I know other people in this place, there has been a very concerted effort—from older people across the community, through campaigns and organisations that represent their voices—mounted to encourage people to contact their local parliamentarians of all flavours in both houses to point out the impact of this range of reductions in their fortnightly, monthly and annual income; and that they are already balancing quite difficult economic circumstances while trying to maintain their cost of living, their lifestyle, and how fragile that can be. That fragility has been exposed by these reductions, and these series of proposals put forward by the government in their budget will have an impact.

This one, the abolition of the supplement, happens immediately. This is not like the change to the indexation rates for the age pension or the proposal to increase the age pension age qualification to 70, which has been planned for the future and has been put in the budget with an implementation date into the future. Some of the people I know are thinking they may not reach that stage. If they are looking at their futures now, they may not reach that eligibility where the line passes into the future.

Those proposals and implementation dates are into the future; this one is not. If this passes the Senate and goes back to the House, the next payment of the supplement is due in December 2014—just before Christmas, an important time—and people have already looked at how they will use that money. They know to a cent how much this is worth to them. They also know when the date of payment is and certainly some of the people I have been talking to have already earmarked what that money is to be spent on—whether it is on Christmas or paying off something they have already put in place. They know where that money was going to go. They now know that the government does not want them to have it. The government does not want to have this allowance and it is not offering an alternative. This payment will not be there.

The particular group of people who are impacted by this payment have spoken and are involved in the wider community. They have contacted me and talked about what this will mean to them. They say that they have a restricted income. They have a form of income which is often through superannuation payments or a DVA arrangement. They are working through that process and they have a non-flexible income. It is higher than the pension—there is no doubt about that—but this is about the only form of government support that they get and they treasure it. They see this particular supplement, small as it is in some people's minds—about $900 a year for the 280,000 people across the country who are currently eligible for this supplement and the 50,000 in my state of Queensland alone—as an important amount of money for them.

For us, I would think $800 is less than the travel allowance we receive to be in Canberra a week of sittings; but for the people who receive this supplement—allocated in their budget, an important element of the budget often linked to the Centrelink or the DVA agencies and the gold card—this will be the end of their entitlement. It is causing pain. As I have said, it is also causing anger and frustration.

When this measure was first introduced we said that it was one of the issues that we would not support. This bill was part of the very large omnibus bills that came originally to this place for consideration. We did not support a second reading of those bills, because we had said we would not vote for anything that cut pensioners' entitlement. We made that commitment to them. The commitment made by our leader and by our shadow minister was that we would not support the omnibus bills, so there was no second reading of those bills. The government has come back and reintroduced the No. 6 bill, which we passed earlier this week. No-one pretends that that was an easy bill to pass. It was very difficult and it caused great angst in our caucus as we worked out what things we would support as effective savings. We understand that there are budget issues and that we need to consider every element of the government's budget proposals, and we did that. We said we would support certain issues but would not support others that, I believe, will be the subject of future legislation. This is the first one that has come back. It is very clear that the government is testing us out on this one. They know that we will not support the bill. We have listened to the people in the community who have said that this will hurt them and that it is something they do not want.

In the inquiry by the Senate Community Affairs Legislation Committee into the omnibus bills one of the things that were said to us on several occasions was that there was a need to look at issues related to ageing in our community. We were told that there was a willingness in the community to have a 'mature'—I like that comment, when we are talking about ageing—discussion about the cost of ageing and how various parts of the system work together, to see what we can do to plan effectively for what we know is going to be a challenge for the Australian community and the Australian economy. Should there be proposals to change the way the welfare system interacts with the community and the economy, that is the place for those discussions to be had.

I truly believe that there was a lot of very strong engagement during that inquiry to see that we need to look effectively at what is happening in the community as we all age and at the impact that ageing will have on wages, on superannuation, on various entitlements into the future, including very important aspects such as housing. Any change to a supplement which is currently part of the system should be looked at through the lens of such an inquiry. It is not enough just to make a budget proposal, saying, 'This supplement is not necessary.' In fact, I have even heard it said that it is for wealthy people. It is not for wealthy people. We have all heard the comments about lifters and leaners. It has almost become a T-shirt. In fact, I think I have seen a T-shirt where people could tick a box to say that they are lifter or a leaner. I am never quite sure that we know which one should go there. To imply that people in our society who are ageing are not worthy of support and should be labelled as leaners does not fix any kind of effective planning into future for what should occur. This is not good legislation. It will not help our community.

5:33 pm

Photo of Rachel SiewertRachel Siewert (WA, Australian Greens) Share this | | Hansard source

I rise to make a contribution to the debate on the Social Services and Other Legislation Amendment (Seniors Supplement Cessation) Bill 2014. Under this bill, as Senator Moore has just pointed out, the seniors supplement will be abolished for holders of a Commonwealth seniors health card and the Veterans' Affairs gold card. The Greens will not be supporting this bill. I will say that again, just in case anybody is in any doubt. The Greens will not be supporting this bill.

We need to remember the context in which this measure has been brought into this place. That is the government's harsh and cruel budget that means that the most vulnerable members of our community will be the most significantly hit by the cuts that are being made. We have discussed the cuts on numerous occasions in this place as part of the aborted debate on the social services bills Nos 1 and 2 and in other discussions. The measure in this bill was originally part of the government's social services bills Nos 1 and 2, which it was not able to get through this place. It is now part of that tranche of bills Nos 4, 5 and 6 that the government subsequently brought in.

Those bills contain some of the most significant changes to Australia's system of income support since the system was first introduced in a consolidated social security act in the 1940s. These are radical changes, bearing in mind that one of the measures in the other bills is to kick young people under the age of 30 off Newstart and income support for six months. They will hit most significantly the most disadvantaged members of our community. The government knows that because the government modelled that. It was using virtually the same model that NATSEM used to model the changes, and NATSEM's modelling clearly shows the impact of those measures.

The government may be prepared to start picking apart our social security system in an ad hoc manner, but we are not prepared to do that. This measure must be assessed in the broader context of the budget cuts to the social security system, of other measures in the budget that are not specifically related to the income support system and of other changes that have been flagged into the future. All of them have the potential to affect older Australians. Older Australians currently face many challenges. Policy changes in this area can have a significant effect if not done carefully, particularly if done on an ad hoc basis and not considered in the context of other changes.

The proposed budget measures contained in the various proposals that have either been before this chamber or are coming before this chamber have interactions with each other and have the potential to impact on older Australians. Some of the challenges facing older Australians include changes to the age pension, affecting age pensioners, retirees and people in their 50s and 60s who unfortunately have not been able to regain work after having to leave paid work or being forced out due to redundancies, restructuring of industries et cetera. The federal budget makes it tougher to survive if you are in difficult circumstances. The government plans to save money through this cut, through abolishing this concession for older Australians. We could suggest a number of ways that government could save money rather than by cutting a concession that is important to many older Australians.

We need to look at these cuts in the face of some of the other changes the government is planning to make either immediately through the budget or into the future. For example, the government wants to raise the retirement age of Australians from 67 to 70. The government promised it would not do anything with the pension, but in fact it is doing so. You need to look at the context in which that change is being made—that is, we have a large number of older Australians who are not able to find work after they have fallen out of work. Older Australians are people over 45—when all of a sudden, when it comes to employment, you are old. On the other hand, you are young when you are 30. Under the government's proposals you will be dumped from income support when you are young, at 30; but, in the employment sense, you are old at 45.

The statistics clearly show that it is becoming much harder for older Australians to regain work. While there has been some success—it was in the paper today—with the Restart program, with I think 485 people managing to find work through that process, you have to remember that that is in the context of over 200,000 people over the age of 45 not being able to find work. That is the size of the situation we are dealing with. We do not yet have adequate provisions in place to help those people who will potentially be stuck on Newstart or in untenable situations before they reach the retirement age of 70. In other words, we still do not have that policy process right.

The government also wants to change indexation of the pension. That will significantly impact on older Australians. The government is also freezing the indexation of the age pension income and assets test, which makes it harder to qualify for the pension. Those are all proposals that have either passed or are being considered by this government. Again, this is in the context of the people who need this sort of support if they do not get the age pension and only just miss out.

Then there are the reviews that are occurring under this government, including the McClure report, which contains substantive proposals to change our income support system. We have not yet seen the McClure report proposals. We are being asked to consider this particular change without seeing what McClure proposes in terms of changing the income support system. We also have the National Commission of Audit proposals, which made significant comments around the age pension and retirement income. For example, they talk about what should be in and what should the out of the assets test. Certainly there will be significant changes there. They also talk about changes to means testing and to the retirement age. All of those proposals impact on what may or may not be happening with regard to how we look after and support older Australians.

A further budget proposal is for co-payments, and there has been a lot of concern expressed to my office around those changes. Another change—to be fair, it was not this government that introduced it—is the reform to the aged-care system. I am not saying that we supported that; in fact we negotiated a number of changes. When the government were in opposition they were involved in a lot of discussions over those changes. The government is now implementing the Living Longer Living Better proposals. Those reforms to aged-care are just starting to be implemented, with the first tranche having started in July and the next tranche starting in July next year. All of these changes have significant implications for older Australians. The government is in the process of planning those changes now. There are changes to both residential care and out-of-home care, some of which involve a cost, and that was acknowledged in this place. That is another change that older Australians are planning for and coming to terms with. So there is a lot of change already going on, and the government wants to make some more.

Given that this government is very clearly looking at further changes to our system of income support, it is not surprising that older Australians are extremely concerned about their financial future. In that context, you also need to remember that we have an increased cost of living and that there are changes being made at a state level. So prices are going up and concessions are changing across states, and that is putting further pressure on older Australians.

For these reasons, we will not be supporting this measure. But we do support the Council on the Ageing's recommendation to the Senate committee inquiry into the social services bills Nos 1 and 2. The Community Affairs Legislation Committee looked at the changes in those bills and in the wider series of bills, some of which have gone through this place and some of which are still to come into this place. COTA's recommendation to the inquiry still holds. They very strongly recommend that there be a review into retirement income. They said:

We believe Age Pension change should not be dealt with in isolation. There needs to be a systematic review of all aspects of retirement incomes that involves all key stakeholders and takes into account any changes that emerge from the Government’s reviews of the financial system and taxation. Retirement income changes have a long term impact on individuals, the Government’s budget and the broader community and this would be an opportunity to get it right.

…   …   …

We believe that the CSHC should be included in the proposed retirement income review and that there should be a discussion about its purpose and place within the retirement income sphere. Current eligibility and benefits for the card should remain as they are until that review has been completed. This would mean continuing CSHC entitlement to the Seniors Supplement.

This is the peak body for older Australians and they are saying that we need to have a retirement review. We agree: there does need to be a retirement income review because there have been a lot of changes. Mr Ian Yates from COTA has also talked about this. He pointed out the financial changes that are occurring. Of course, he is right: they also need to be included. COTA believe that there needs to be a broad ranging retirement income review and, as I said, the process should involve consultation with key stakeholders. The review should be done in a timely matter and, if it were completed by late 2015, COTA say it could feed into the 2016 budget.

They went on to say:

COTA believes it would be useful to set up a structured process of roundtable discussions involving key stakeholders to look at varied policy options and their social and economic impacts. Such a process would need to be well informed and evidence based.

They suggest the review could look at the current indexation arrangements, proposed cuts to the aged-care system, employment of older people, deeming thresholds—that is another point that I have not touched on before, and those changes are very important—income and asset levels used for means testing, as to whether they are an unfair and inadequate response to age-pension income, and also other asset test issues. They will also look at the objectives and benefits of the CSHC. Those are all very valid points and it is clearly time, given all those things that I have just mentioned, that we have that review. This sort of cut—an ad hoc cut—should not be considered, we believe, until a review has been done and we have a clear picture of what is going on.

Older Australians are under increasing pressure. We have a narrative at the moment that we will have a burden with the growing number of older Australians. That helps to facilitate some of the discrimination that older Australians are currently facing, trying to find work and trying to ensure that they have adequate income. Older Australians are facing many cost pressures. As Senator Moore pointed out, it is being carefully planned into people's budget in the run-up to Christmas and into the future, and we do not believe the cuts are appropriate.

The government want to look at how they can make some money. How about looking at some of the reforms that could be made—for example, around superannuation tax sessions? The cost of superannuation tax concessions in 2014-15 is projected to rise to $39.6 billion and over $50 billion in the following year. If we are going to do reform, let's look at where some of that investment is incurring and whether it is focused in the right way. Are we getting value for money for that form of investment? Do not look at the low end of where the concessions are; look at where some of the big bucks are and question whether that is being invested wisely. Look at those issues. That is something that definitely needs to be looked at in the retirement income review.

OECD figures show that poverty amongst Australians aged over 65 is currently already 35 per cent, and there are concerns that this will increase in the face of changes to indexation, the retirement age and other budget measures. We should be looking at how we support older Australians as they age, as they reach retirement age and as they pass retirement age. We strongly support the call for a retirement income review and urge the government to relook at this issue and put in place a review that involves all stakeholders and takes a systematic approach to how we support older Australians.

5:50 pm

Photo of Anne UrquhartAnne Urquhart (Tasmania, Australian Labor Party) Share this | | Hansard source

Today I rise to speak on the Social Services and Other Legislation Amendment (Seniors Supplement Cessation) Bill 2014. Labor opposes this bill, just as we oppose so many of this government's cruel attacks and broken promises. At every turn and around every corner, it seems that there has been another attack on older Australians by the Abbott government. We should not forget that these are the people who have helped build the social and economic wealth of this country. They deserve our respect and they deserve our support. But what are they getting from this government? Disregard and broken promises—that is what they are getting. The Abbott government has set out on a concerted campaign to keep people working longer and ensuring their quality of life is lower when they do retire.

The bill before us today seeks to abolish the seniors supplement, which is paid to 290,000 self-funded retirees in Australia. This billion-dollar cash grab will take away nearly $900 from Commonwealth seniors health cardholders each year. Perhaps those opposite do not understand what $900 could mean to someone on a relatively low income. Back in the real world, this is going to hurt. With rapidly rising rates for utilities and accommodation, self-funded retirees will find it harder and harder to make ends meet. These are people who have worked their whole life to build a nest egg to support them through retirement. These are people who did not have compulsory superannuation for much of their working life. These are people who saw their savings devastated by the global financial crisis. Despite all this, they have managed their money in order to secure a more independent future for themselves, and now the government just wants to hit them again. For years, Tony Abbott and the Liberal Party pretended they were the best friends of Australian seniors, and yet, as soon as they got into office, all they did is punish older Australians. We did not hear a whisper from the Liberals about this brazen cash grab before the election, nor was anything said about their plans to cut the deeming thresholds.

Older Australians, who have amongst the greatest healthcare needs in our community, were never warned about the government's small minded plans to jack up the cost of going to the doctor. While $900 might be a drop in the ocean for those opposite, most older Australians have to be very frugal to ensure that the money will be able to support a decent standard of living for the rest of their lives. The reality is that most self-funded retirees who are eligible for the seniors supplement are living on an income of less than $50,000 a year. On this sort of income a $900 cut is a big hit to the household budget. For this government to make such changes without giving any warning to allow older Australians to make plans is just unfair.

The truth is that older Australians have every right to feel betrayed by the Abbott government. Those who are forced to rely on the pension are particularly hard done by, in direct contradiction to what the government promised before the election. Not too long ago our Prime Minister had the audacity to suggest that Australians were somehow at fault for not understanding his pre-election promises on Gonski. On this issue he told Andrew Bolt:

We are going to keep the promise that we actually made, not the promise that some people thought that we made, or the promise that some people might have liked us to make.

In case I am accused of not listening to or understanding the Prime Minister I thought I would put on the record just a few of his many quotes, before the election, about pensions—as many others have done. On 28 August last year, Mr Abbott promised the people of Western Sydney that there would be 'no cuts or changes to pensions'. He said that at the people's forum in Rooty Hill. On September, in an interview with Sabra Lane, he said:

… I can assure your listeners that there will be no cuts to health, no cuts to education, no cuts to pensions, no change to the GST ...

He continued the theme on the night before the 2013 election, when he told the SBS that there would be 'no cuts to education, no cuts to health, no change to pensions, no change to the GST and no cuts to the ABC or SBS'. So we can see this was not a slip of the tongue in the heat of the moment. This was solid, focus-group-tested Liberal Party election mantra.

After the election, the government changed their tune. After the election, they revealed their true plans to make changes to the indexation arrangements, which will see Australian pensioners $80 a week worse off within 10 years. They also set in place moves to increase the pension eligibility age to 70, which would make the Australian pension age the highest in the world.

It is not surprising that a recent analysis by the Australian Financial Review found that those opposite have broken more promises than they have kept. This government is not only breaking promises but is eroding the trust of the Australian people in the processes and principles that underpin our democracy.

And pensioners are not the only ones in the crosshairs. This is a government that has waged a concerted attack on the most vulnerable people in our communities. Let's not forget that the poorest 20 per cent of families, with earnings of less than $35,000 a year, will lose $2.9 billion over four years as a result of the Abbott government's cruel budget. But those who have a family income of $88,000 or more after tax will only lose $1.78 billion—a full 40 per cent less than low-income families.

It is also interesting to note that the government has been very careful not to place the burden of their budget cuts on communities in their own electorates. In fact, recent analysis undertaken by Australia's premier modelling outfit, NATSEM, laid bare the rampant self-interest at play in this government's cruel budget. In this study, NATSEM found 15 of the 16 electorates hardest hit by this cruel budget are held by Labor. In contrast, four of the five electorates that will be least impacted by Tony Abbott's budget are held by the Prime Minister himself and senior government ministers. What a surprise!

In Mr Turnbull's electorate of Wentworth, residents will see a decline in income of $69.50—or 0.1 per cent of disposable income—as a result of this government's budget of twisted priorities. But in the Jason Clare's Western Sydney electorate of Blaxland, residents will see an average $990 hit to annual incomes by 2017-18. For families with children this will more than double.

Clearly, this is a government that consistently attempts to put their own jobs ahead of compassion and treating Australians with dignity. They are barefacedly ripping funds away from the poor and the vulnerable, while leaving those on high incomes barely scathed. However, what the government did not count on is that the majority of Australians do not share this brazen self-interest. We do not want a nation that is unfair. We like the fact that equality is a key principle of Australian society, and we support a strong safety net for those who encounter times of need.

We celebrate the fact that the ideas of compassion and a fair go are deeply embedded in our national identity. We believe that government has a clear role in helping to open the door to opportunity for all Australians, regardless of income or the challenges that come from circumstance. And we will not support these fundamental features of our nation being ripped apart.

If there has been any good to come out this sorry budget, it has been the widespread support for the existing Australian social contract and the clear rejection of the government's attempts to tear it up. But, clearly, this government is not listening. Instead, they are belligerently ploughing on with their cruel cuts to the poor, elderly, sick and unemployed, while at the same time squirrelling away billions for their pet projects.

The absolutely nonsense of this government's argument comes into sharp focus when they use one breath to say that we cannot possibly afford proper health, education or a strong safety net, and in the next breath promise $50,000 cheques for wealthy women to have babies. Both of these things cannot be true, Mr Abbott. If we do not have the money to pay for programs that support Australians to be the best that they can be, then we certainly cannot afford the wasteful spending programs the government has been embarking on in other areas. Australians are not stupid. They see this, and they recognise the rank hypocrisy at play. They see through a government that is fearmongering over the so-called budget emergency while axing viable and lucrative sources of revenue. They recognise that the government is only concerned about saving money or increasing revenue, when it is the poor and the vulnerable who are going to foot the bill.

The legislation before us today is another example of the disregard that this government has shown for older Australians. It is nothing more than a blatant cash grab. We on this side of the chamber understand that Australian seniors have worked hard all their lives and have saved for their retirement. Older Australians do not deserve to have their pockets raided by Tony Abbott in their retirement. Labor will continue to stand up for Australian seniors and pensioners by opposing this bill and the rest of the Abbott government's savage budget cuts.

6:00 pm

Photo of Sue LinesSue Lines (WA, Australian Labor Party) Share this | | Hansard source

I too rise to speak in opposition to the Social Services and Other Legislation Amendment (Seniors Supplement Cessation) Bill 2014. I begin by saying it has been a tough week in the Senate so far, as the government has tried to get its harsh, cruel budget through the Senate. I wonder, as we head to the end of 2014, if indeed we will be here in 2015 defending our great Australian psyche—part of our culture of a fair go. When will the Abbott government get the message that there is not a voter in this country who is on a low income, has a family or is a single person aged under 30 who supports this harsh, cruel budget? Today we have had to defend against the paltry pay offer to the Australian defence forces in this place. I brought to the Abbott government's attention its disgraceful lack of bargaining in good faith with the CPSU, who now have in the Department of Human Services, the biggest government agency, a 95 per cent vote for industrial action, and somehow the government labels them as being irresponsible.

What we have seen over and over again from the Abbott government is this blame-shifting going on. They try and blame Labor or they try and blame the unions, or they try and blame anybody but themselves. The Abbott government have now been in power for more than 12 months. It is time they stood up to their own decisions and were honest about the sorts of policies and the type of Australia that they want to create—and it is one of dog-eat-dog; it is, 'You are on your own; your family looks after you or you look after yourself, because it is not the federal government's responsibility.' I note the number of times that Labor senators have heard government senators and government MPs say, 'We do not run hospitals; we do not run schools,' therefore somehow trying to abrogate their responsibility towards schools, health and education. But quite clearly the government have responsibility when it comes to senior Australians. Yesterday in this place we had a bill before us—most were sensible moves that the Labor Party had indicated months and months ago that we would support. But no: the Abbott government indicated they wanted to wrap them up with other harsh, cruel measures which Labor have been very clear from day one that we would not support.

Despite us saying 'no' over and over again, the government obviously tried through its new approach—its backdoor deals—to get the bills approved. But it has failed in that, and so now what we are seeing is this mishmash of bills coming through with the little bits that are agreed and the other bits—the harsh, cruel pieces—still there. It is still the intention, as we understand it, of the Prime Minister and the Treasurer, Mr Hockey, to try to ram those bills—those harsh, cruel measures—through our parliament at some time in the future. Whether it is the next sitting period or next year, apparently it is still their decision to do this, despite what must be an overwhelmingly negative response. The government seems to think the best way forward is to just plough on with its harsh, cruel measures.

Yesterday in this place I informed the Senate that I had held a very successful meeting of seniors in the electorate of Swan, the electorate that I live in in Western Australia. More than 100 people came along, and they were very, very alarmed. Some of them were self-funded retirees who were very concerned about the loss of the seniors supplement that the Abbott government has stolen from them—we could not really even call that one a broken promise, because it completely came out of the blue. Australia's seniors, whether they are dependent upon the pension or are self-funded retirees, must be wondering how much more the Abbott government can take from them. Seriously, they are one of the groups the Abbott government has absolutely gone after in our community.

These are senior Australians who have paid their debt to society, who have raised families, who have taken on responsible jobs, who have taken out mortgages when they have bought their homes or who have been in rental accommodation. These are upright citizens who continue well after retirement to add value in our communities through the volunteering that they do, through looking after grandchildren if they have them and through all of the services they provide, whether it is the Red Cross in our hospitals or whether it is the local Meals on Wheels. Nobody in this place would dispute the role that seniors play in our society—except the Abbott government, which shows them no respect at all. It shows them no regard—just complete disrespect, by making their lives as tough as it can. After all, it was the Prime Minister who, before the election, promised Australian pensioners that there would be no cuts to pensions, and on the issue of the seniors supplement he was completely silent. Yet the Abbott government has not only cut pensions; the Abbott government intends to cut, with this bill, the Seniors Supplement.

The Seniors Supplement was introduced by Labor in 2009. We had got the message from seniors. Many seniors had protested throughout the country, and we had actually listened to what seniors were saying, unlike the Abbott government, who get emails from seniors protesting, and who no doubt in electorates get confronted by seniors telling them how difficult these cuts are going to be for their lives but, no—no consultation, no discussion; just a secret cut. We introduced that supplement in 2009 as a support for senior Australians, because we recognised that from time to time seniors need help to pay regular bills such as power, gas and phone, and to buy petrol and pay for car registration. We have all heard those horrible stories of seniors living in our community not turning their lights on or going without turning their heaters on in winter. Those are not things that those of us who are responsible participants in our community want to foist onto seniors, and that is part of why Labor introduced that supplement—to give some comfort to seniors.

Cutting the Seniors Supplement will hit 300,000 Australian households, and they will be $886 a year worse off. That is not a big figure for the Abbott government, but it is a big figure for someone on a fixed income. It is a big figure. It is money they now have to find. And of course what the Abbott government has not thought about, in its usual slash-and-burn approach with this harsh, cruel budget, is that taking that money not only forces seniors to find that additional money—almost $1,000 a year—but also hits local economies. It hits the local deli and the local shop. It hits the local greengrocer. It hits the cafe where once a week perhaps seniors like to meet with their friends and have a cup of coffee, because seniors will now have to make up, from their fixed budgets, that missing amount of $886 a year, which means, in small communities, rural communities, that seniors will spend less in local shops, and that will make a difference.

In the Western Australian electorates that I have responsibility for, this is quite a hit. In the south-west, in the electorate of Forrest, seniors will be hit. Along with the loss of the Seniors Supplement, if the GP tax goes through they will be hit with that. If they need specialist services—and we know that our seniors do have a greater use of our health system, and that health system should be available for them to make use of—there will be additional hits on specialist services. There will be increased costs for pharmaceuticals. After the secret deal that the Abbott government did last week, from 10 November they have been hit with an additional fuel tax—a hike in the cost of fuel which, of course, in the south-west communities of Forrest, where seniors need to drive sometimes 100 kilometres or 80 kilometres to the bigger towns, that will be a hit on their budgets as they are now having to pay a higher rate for fuel. We already know that, in our remote and regional communities, fuel is often more expensive. And I know that Senator Peris can tell us horror stories of the cost of fuel in the Northern Territory.

So, along with all of the cuts that I have outlined, there have been other harsh cuts to the budgets of these seniors imposed by the Prime Minister. Many small rural towns in the electorate of Forrest—towns like Collie, Augusta, Nannup and Donnybrook—will be hard hit as seniors have less money to spend in their local economies, in those small towns where the local deli and the local greengrocer rely on seniors coming in to buy their bits and pieces. They will be hit in the electorate of Forrest. This cut to seniors in the Forrest electorate is almost $2 million: $1.95 million has just been taken out of that electorate, without a care from the Abbott government. People in one of my other electorates, Canning, for which Don Randall is the member, will be hit to the tune of $1.69 million. That will be taken out of that electorate of Canning. In the electorate that I live in, the electorate of Swan, the hit on senior Australians will be $1.5 million—$1.5 million. And what have the Liberal members in these seats said about the loss of this supplement to seniors? Absolutely nothing! I have not seen it in any of the pamphlets that Mr Irons puts around. Nothing—complete silence. And why would they spout it? It is hardly something to be proud of. There is nothing they can say. It is just another mean attack by their Prime Minister and their government.

Of course these cuts are just the beginning for seniors. For seniors getting the supplement, many of whom do hold a Health Care Card, there is a double whammy, as the federal government has also cut the funding it provided to states for concessions. The federal budget cut $107 million over four years from Western Australia's seniors concessions, with WA set to lose $25 million this financial year. That supported pensioners' and seniors' discounts on local government rates, vehicle registrations and water charges—now all under threat.

Premier Barnett has said that he was very surprised about the decision. I thought mates—Liberals being Liberals—kind of kept each other in touch, but obviously that is not the case, because he was surprised by that decision. But he has insisted that the state government will not step in to make up the shortfall. And why would Mr Barnett step in, when he has made such a mess of the state government finances in Western Australia? He lost the AAA credit rating. He has not been able to open our premier hospital; it has been 18 months overdue and has cost the state millions and millions of dollars. He has shown himself to be absolutely incapable of managing anything—probably even a household budget. So of course he is not going to make up the shortfall.

And, of course, Premier Barnett abolished the private vehicle rebates for motor vehicle licences on 10 July—no phase-out, just bang, gone. Seniors and pensioners were hit hardest by the removal of that benefit, with increases of up to 212 per cent, but Premier Barnett does not care—and nor does the Abbott government. The private vehicle rebate last year was worth $72. Again, that is not a big-ticket item for state governments but it is a huge amount to a senior's or pensioner's budget. These Australians have worked hard all their lives to save for their retirement, to be responsible, to be self-funded. They have, no doubt, made sacrifices along the way to ensure their retirement is a comfortable one. They do not deserve this punishment from the Abbott government for all their hard work over a lifetime.

And who are these folk? It is certainly not rich seniors who are receiving this supplement. Single seniors need to have an annual income of less than $51,500. Day after day in this place we hear from the Abbott government about not incurring debt and not passing debt onto children and grandchildren. You would think the one group in our society the Abbott government would seek to look after are the self-funded retirees. So why on earth would they take away the seniors supplement if it enables those self-funded retirees to continue to fund their own retirement? I would think that would be a win-win all round. But, again, the ideology of the Abbott government always gets in the way; their Tea Party right-wing ideology stops them from seeing the sense in keeping such things as the seniors supplement.

These people are not Australia's ageing millionaires. They are everyday Australians. They are my neighbours and your neighbours. They go on contributing to our communities in their retirement. Many of the services in our communities simply would not work without the volunteering that seniors do—contributing to their small local communities with their hard earned retirement savings. My neighbours in Swan will lose the money that pays their power bills. They will share this pain with almost 2,000 seniors in the electorate Swan.

The Prime Minister promised there would be no cuts to pensions, education, health, the ABC and the SBS. The Prime Minister cannot be trusted on his word. It is a year and a couple of months since he took office, and this is his legacy. With the sad passing of Gough Whitlam, many of us on this side of the House spoke about the proud legacy that Gough Whitlam has left. Well, Prime Minister Abbott will leave a legacy of broken promises and further cuts such as the seniors supplement. This cut was not mentioned anywhere—it was a secret attack—but obviously it was already costed and hidden away in the secret portfolio entitled 'The Real Liberal-National Coalition Plan'. As senior Australians can testify, Mr Abbott never mentioned this hit on their household budgets before the election. He never mentioned that the seniors supplement was under threat. The Prime Minister has described these payments for seniors as a cash splash. Again, Mr Abbott shows just how out of touch he is.

We have now heard almost a book full of these sorts of clangers from the government. Mr Hockey made the ridiculous statement that poor people do not have cars or do not drive very far. They are absolutely out of touch. To say to a single, self-funded retiree on $51,500 that the seniors supplement is just a cash splash is an insult. The cash splash comment by the Prime Minister is an insult to someone who has saved for their own retirement income, someone who has said, 'As a citizen, I'm taking responsibility for my own retirement.' Seniors have a right to feel betrayed by the Prime Minister and the whole of the Abbott government because there was no mention of this before the election. I give a guarantee to Australian seniors and pensioners that, every day until the next election, Labor will fight this harsh, cruel budget. Neither we nor the Australian voters will let Mr Abbott get away with the deception of these broken promises.

6:20 pm

Photo of Deborah O'NeillDeborah O'Neill (NSW, Australian Labor Party) Share this | | Hansard source

I am a little lost for words after listening to the contributions of my colleagues in the chamber. In particular, Senator Lines has just spoken about the language the Prime Minister used for his audacious and heartless ripping away of support for pensioners across this nation, which he called a cash splash. To deceive the Australian public and pretend that there would be no cuts or changes to pensions before the election is just appalling. But to be in the position of Prime Minister and to be so disrespectful as to describe as a 'cash splash' money which the seniors of this country count on, money which they budget down to the last cent to balance their books, reveals the breathtaking arrogance of the man who used those words. The insult of taking money away is one thing, but to treat our pensioners as fools and to be so disrespectful is another. It is something for which the ageing people of Australia will not forgive this Prime Minister.

There is nothing to sugar-coat the life of an age pensioner. Perhaps their engagement with their grandchildren, their family and their friends goes a long way to making their hard-won retirement a great thing. But the facts are that, for many Australians, they have worked hard all their lives, paid their taxes, raised a family most likely and contributed to the national economy, and then they retire. Retirement in Australia for more than 2.3 million Australians does not mean a world cruise, time to spend at the country club or living it up in the lap of luxury. It means a life on a pension and the careful financial management that is part of that life. It actually means getting by on $421.10 a week for singles and $635.30 combined for couples. That is not an easy task, but our pensioners do it and they manage it. They count on the Seniors Supplement that this government has introduced legislation into this place to remove. For too many pensions already it means scrimping on every dollar. It means watching every cent at the supermarket. It means cutting back on heating during cold winters and cutting back on the cooling during the hot summers just to keep the electricity bill manageable. This piece of legislation is set to take away money from millions of seniors in this country, to exacerbate any challenges they face. It is a deliberate and wilful attack on the ageing people of this nation.

Living on a pension for many means a very, very challenging life. If you are an age pensioner it is likely that your nest egg is pretty modest, built from hard work and savings that for many of you, indeed most of you, predate compulsory employer contributions to superannuation. This process has changed things for those who are now going to be its beneficiaries. This Labor visionary process has established the opportunity for those who are beginning their work life to see their retirement in a different way. For many of our seniors, while their family is supportive and their dignity defines them, they do not want to ask for charity. They are quite happy to manage, and they are managing with the Seniors Supplement that this government is attempting to take way from them—determined to take way from them—in this legislation.

A legitimate means tested payment like the Seniors Supplement is available only if you hold a Seniors Health Card. It is not charity. It is a hand-up which many of our seniors absolutely rely on. It helps our seniors to maintain their dignity and independence. It is a small thing that helps them meet the ongoing costs of running a household. Tony Abbott's budget has no respect for the dignity of the seniors of this nation. The budget of this government has no regard for what it is like to struggle to make ends meet. This piece of legislation is seeking to undermine pensioners' living standards by what the Treasury has predicted will be $80 a week in 10 years time. That is an awful lot of money for somebody living on a relatively low, fixed income.

The Combined Pensioners and Superannuates Association of New South Wales say that pensioners will be $100 worse off in 10 years time—and I guess it is their business to know. They are passionate and powerful advocates for the sector, and I know that they are counting on Labor to push back against this terrible piece of legislation coming from those opposite. From 1 September 2017, under Tony Abbott's discriminatory budget, the age pension will be tacked solely to the consumer price index. As we know, the index most often taken as a benchmark, out of the three indices available under the present system, is Male Total Average Weekly Earnings, calculated at 27.7 per cent of male average earnings. This index, the one which Labor agreed with, has consistently returned the highest result for the calculation of a pension increase, because wage growth has generally exceeded CPI. The decision to use the Male Total Average Weekly Earnings index is about making sure that the quality of life of those on a pension moves in sync with the wages of the people who are living in the community around them. It seems fair to me. Labor agrees with it, because we believe in fairness. This legislation, however, reveals that the other side do not believe in fairness but rather believe in taking the most from those who have the least.

Tony Abbott's plan to rely only on the CPI will have a significant effect on pensioners across Australia. For example, had the Prime Minister's new system been in place for the past four years, the single pension, which today is $854 a fortnight, would only be $762. Now that is a very big difference and would have a material impact on the life of a pensioner. It is a whopping $92 or 11 per cent difference—money that pensioners can ill afford to lose. On top of this huge cut, he is trying to remove the Seniors Supplement. Quite simply, Labor will not stand for it. The people who voted for Labor in the last election knew that when the time came we would fight for fairness, and that is what is happening in this chamber this evening. It is a fight about fairness—Labor on the right side of history, looking after ordinary, average, hardworking Australians; and those on the other side determined to heap disadvantage on those who have the least capacity to pay.

Nearly five months ago, Labor announced it would support sensible savings in this year's budget, but because of the Prime Minister's determination to cut the pension and determination to savage family tax benefit, to leave young people without income support for six months, we have refused to support such outrageous efforts by the government. And now we have the modelling done by the Combined Pensioners and Superannuants Association using just the CPI to predict that the pension is going to lose the value of $100 a week within 10 years.

The increases in the cost of PBS medications, the GP co-payment and the massive cut to the national partnership agreement on concessions which means that pensioners stand to lose their state-based concessions on bills such as council rates, gas, electricity, water, transport and car rego, are real and material impacts on people's lives. They will change how pensioners are able to live and for some it will be the straw that breaks the camel's back. It will just push them over the edge. They are concessions that pensioners rely on every day. They are relying on the hope that state governments will find money in their budgets to pick up the slack left by the Abbott government's abandonment of its responsibility to the Australian people. Day after day, certainly in this week, we have seen this government attack every sector of the community that is vulnerable. Today, the retirement security of our Australian pensioners is right at the fore.

One of the things that is most infuriating for the seniors whom this legislation is designed to affect is that Mr Abbott stated that a letter claiming the government is cutting pensions 'is not true; there are no cuts to pensions'. This is clearly a significant cut to pensions and to pensioners. The impact of this is absolutely devastating for many people right across this country.

I want to go to the numbers of those who will be affected in the seats which, as a duty senator for New South Wales, I represent. I live on the Central Coast of New South Wales, as the Acting Deputy President would be aware. It is a beautiful place which draws to it many retirees who have worked and now seek a sea change. It is a very welcoming community. The retirees contribute an enormous amount, particularly in volunteerism and they bring wisdom to our community. In the seat of Dobell, 1,577 people will lose if Tony Abbott wins today. In the seat of Robertson, just south of Dobell, 2,202 hard-working Australians who are relying on this concession payment will lose if Tony Abbott wins today. In the seat of Paterson, a little further north, 2,220 families—

Photo of Carol BrownCarol Brown (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Families and Payments) Share this | | Hansard source

Name them.

Photo of Deborah O'NeillDeborah O'Neill (NSW, Australian Labor Party) Share this | | Hansard source

I can name a few on the Central Coast. A lot of them live in my street. And in the seat of Mackellar, 4,000 people are going to lose their concessions. In the seat of Macarthur, 890, and in the seat of Warringah, where they really should have known better because that is where they could have got the truth from the fellow himself, there are 3,877 people who have been lied to by this government. In the Prime Minister's own electorate, there are 3,877 people who he is trying to convince he is not dudding. There are thousands and thousands of seniors right across this country who believed that little blue book. It was a pretty slick production; you have to give that to them.

I did a lot of doorknocking before the last election, which should not surprise the Acting Deputy President sitting in the chair. I can remember seeing these blue books, these lovely glossy books saying how wonderful the world would be, that all we had to do was to vote in the Abbott government and the world would be set right. But what we set in train was a litany of lies. Today we see the legislation that proves it. 'No changes to the pension.' You have to be joking. This is a disgraceful change. This is a devastating change which will materially impact the lives, the health and the wellbeing of seniors right across this nation.

I can only think that the Prime Minister must have a very low opinion of the intelligence of pensioners if he thinks that they cannot work out what he is doing. But it is not just the Prime Minister. He has a few friends in this place, more in number than us, sadly. Otherwise, this would not be happening. I have to report that the Assistant Minister for Social Services, Senator Mitch Fifield, visited the Central Coast last week to peddle some form of misinformation about the good news the government has for seniors. Of course, the seniors are a wakeup to this mob. The minister was met by concerned locals, who were waving placards demanding a fair go for pensioners—a fair go, the signature of Labor and clearly something that is hated by those opposite. Otherwise they would not be inflicting these social service budget changes and they certainly would not be going after retirees, self-funded retirees and pensioners with this piece of legislation.

The arrogance of the assistant minister thinking he could go up there and pull the wool over the eyes of my local community was astounding. The elderly are not just angry; they are worried sick. They are certainly a lot smarter than this PM is giving them credit for and I think their voice is going to become stronger and stronger. This is the voice of a Central Coast resident who summed up her dire circumstances in correspondence to me:

As a person who has been very careful to make ends meet on the pension, I am not sure how I would manage if my income was reduced in any way.

I understand that the proposed changes to the way the pension is index, for example, would mean a cut of $80 a week over 10 years to the single pension, which seems like a huge amount when it is already a stretch for me to pay my bills, buy my groceries and get to important appointments.

And the most devastating part of her letter was the final sentence, where she signed off:

I just don't have any way to make up that difference.

Let us have a look at what is happening. The gap between what we do in this place and how it impacts people's lives is sometimes an interminable distance. People do not get the sense that these things are connected. But today we have to be really, really clear. There was a promise made by an incoming government that there would be no cuts or changes to the pension. That promise has been absolutely and totally broken.

Pensioners will feel the hit if the government is successful in getting this legislation through and they will feel it very, very quickly. They know that they cannot tighten their belts any further because, as this woman wrote to me, they just do not have any way to make up the difference. Can you imagine what it would be like to be an age pensioner who is trying to pay their rates and do the right thing, who has budgeted in anticipation that the seniors supplement would be part of their budget for this year, who finds come Christmas that they cannot make that budget work anymore? They will care. They will be anxious. Their families will be anxious for them. They have been deceived and they are being materially impacted by the meanness, the slipperiness and the disgraceful intent of this piece of legislation.

That was just one voice of the millions of pensioners who have suddenly found out about this terrible broken promise. It is a contrast to Labor's historic pension increase, where we delivered a $33 increase to the single age pension, the disability support pension and the carer payment. We brought in the biggest increase since the Whitlam government that raised pensions by 10 per cent. He did that in 1972. If Tony Abbott's CPI pegging was in place from 2009, that significant increase to pensions would well and truly have been wiped out now. Australian pensioners have every right to feel completely betrayed by that little glossy, blue book and all the nonsense that they have read in the papers that were the promises of this government prior to coming to power.

I know that Australian pensioners and seniors have worked hard all their lives. They deserve the dignity of a secure retirement. That is why with my colleagues on the side of the chamber, I will fight as a Labor woman for Australian pensioners and seniors, and fight for their rights to a dignified retirement, free of stress and anger at broken promises that are flowing through every single day in the areas of health, education and financial support. It is writ large in Mr Abbott's cuts to pensions, to welfare, to our universal healthcare system, to education and to refugees that he is a prime ministry of arrogance. When it comes to the less fortunate in society, they are beyond his gaze. (Time expired)

6:41 pm

Photo of Kate LundyKate Lundy (ACT, Australian Labor Party) Share this | | Hansard source

I rise to speak on the Social Services and other Legislation Amendment (Seniors Supplement Cessation) Bill 2014 and I am glad to be able to speak against cuts put forward in it as they will greatly negatively impact senior citizens in Australia. Cutting the seniors supplement is only one of a number of measures outlined in the Abbott government's budget that targets senior citizens in our country. We know that older Australians are being saddled with a disproportionate burden in the Abbott government's unfair budget.

The axing of the seniors supplement was part of legislation containing the harshest of the social services budget measures recently abandoned by the Abbott government. It was abandoned because the Labor Party and others in the Senate understand the terrible impact these harsh measures will have on all Australians. We understand the impact on older Australians, who have spent their lives contributing to Australia's economic and social wellbeing. We understand that Australians are distressed by the government's attack on vulnerable people, an attack which equals an attack on Australian values—the value of equality, opportunity and a fair go. Like my colleague Senator O'Neill, I am proud to stand with Labor and the Australian community against these cruel cuts—cuts and changes that pile burden after burden on those most vulnerable.

Unfortunately, the government in this bill are now reintroducing some of their most savage measures. They continue to dismiss and ignore the community discontent regarding their cruel legislative agenda. They continue to show that they do not value equality and fairness. They believe they can reintroduce these unfair bills to the Senate and miraculously get a different result. Well, my Labor colleagues and I will not back down. We will continue to fight hard to ensure that low- and middle-income Australians do not bear the brunt of this government's immoral cuts.

The seniors supplement supports self-funded retirees whose income is less than $50,000 a year. It was designed to support Australians who have worked hard throughout their lifetimes and managed to save some money for retirement but who still experience financial pressures on a day-to-day basis. The supplement was designed to help them pay bills such as rates and land tax, so they can continue to afford to live in their family home. It was designed to support them to pay motor vehicle registration so they can continue to drive. It was designed to help provide this hardworking group of people with some income security to get them through their retirement.

Axing the seniors supplement will impact a huge number of older Australians. It will leave some 300,000 Australian seniors almost $900 a year worse off. In my electorate in the ACT, more than 12 per cent of those over the age of 65 rely on this supplement to help them meet the cost of living. I cannot support cuts that will hurt so many people. These Australians have worked hard all of their lives to save for their retirement and proudly so as self-funded retirees. We have had many a debate in this place where self-funded retirees have had a vocal and omnipresent place in the debates. They are highly respected for the work that they have done in saving for their own retirement.

But all of this did not stop the Prime Minister describing payments for Australian seniors as a 'cash splash'. I wonder if the Prime Minister and Mr Hockey consider these hardworking Australians to be 'leaners', not worthy of this targeted support that helps them get by. The issue of 'leaners' is an interesting one, because this government seek to characterise those in need in our community, those who are in receipt of this kind of supplement, as somehow leaning on the rest of us. I do not think anybody could describe self-funded retirees as leaners in any way. But the government have taken the same approach to cutting this supplement as they have to other welfare cuts—to others that they have called leaners. So it is a reasonable extrapolation on my part to assume that this government think this group is a bunch of leaners as well.

I do not like the term; it is pejorative in the extreme. It characterises the way in which this government approaches the task of implementing a series of draconian cuts. Why not cause a bit of fear? Why not cause a bit of concern or a bit of angst in the community? Why not imply that some in our community are less deserving than others? And why not use that as the political device to underpin the government's justification, which will no doubt come, for this ridiculous and unfair bill? Let's see what those opposite have got to say. I am interested to know whether the government thinks self-funded retirees are leaners—in their parlance—and are somehow therefore deserving of this cut. Let's see what they have to say.

I would put it to the chamber that these Australians, who have worked hard all their lives, are not leaners. They deserve the support they get. The support that they get helps to ensure they maintain a decent quality of life in their retirement years and can continue to contribute in an enormous way to our social and economic wellbeing. Mostly, I have to say, this is through volunteering. Here in Canberra we are in a month where volunteering is being celebrated and acknowledged through 25 days of volunteering, which I had the pleasure of participating in last week when I worked for a short time—I am very humble about this—at the Villaggio Sant' Antonio in Page. It is a wonderful aged-care facility, where I met a whole group of employees and volunteers who spend their days making sure that the residents of that facility are happy and healthy. I am sure many of the volunteers that I met would have been self-funded retirees and I suspect—although I do not know—that some of them may well be standing to lose this $900 a year as their supplement is cut.

Axing the seniors supplement is just one of a number of cuts in this budget that will impact older Australians. This government has already cut $1 3 billion in funding from the National Partnership Agreement on Certain Concessions for Pensioners and Seniors Card Holders. The concessions funded by this initiative helped to reduce the cost of public transport, the cost of power bills and the cost of water bills. For many seniors, these concessions are the difference between being able to pay bills or face disconnection of critical services. I applaud the ACT government—under the inspired leadership of Katy Gallagher—who recognise the importance of these concessions to seniors in our community and who have made it a priority to absorb the loss of this funding in their budget. However, the enormous cuts to states and territories in education and health make it very difficult for states and territories to continue to protect their citizens from the federal government's cruellest cuts.

It is important that we examine holistically the impact this budget will have on older Australians. Not only is this government seeking to axe the seniors supplement and not only have they removed $1.3 billion from the National Partnership Agreement on Certain Concessions for Pensioners and Seniors Card Holders but they also seek to introduce a $7 GP tax and increase the co-payment for prescription medication by $5 per script. Older Australians, who are—I think it is reasonable to say—likely to face age-related illnesses, will bear the brunt of these costs.

Using the Australian Department of Health's Medicare annual statistics, we can determine that Australians aged 65 or older are almost three times more likely to require Medicare services such as GP services, specialist services, pathology services and diagnostic imaging. This is an indication of the disproportionate impact a GP tax will have on our older Australians. Even more concerning is the impact on older Australians of the increase in the co-payment for prescription medication. Department of Health data shows us that Australians aged 65 and older are approximately nine times more likely to require a script than other Australians. Clearly—and I think the evidence is there—older Australians are being targeted by the government's GP tax and increased co-payment for prescription medication.

Details have emerged that the government's plan to cut the rebate to radiologists and abolish the safety net for high-cost diagnostic imaging services will further impact on the cost of healthcare services. Australian Diagnostic Imaging Association has said that the cuts to rebates to radiologists will mean that it will be untenable to raise the cost of these services by only $7. Under Medicare rules, any patient charged these higher fees must pay the entire amount upfront. So Australians will be forced to pay hundreds or even thousands in upfront fees for some diagnostic services. For many people, these upfront costs will be a major barrier to accessing the tests they need. For older Australians who are facing huge increases in the cost of medication and GP visits this could prove an insurmountable barrier.

How will these cuts and taxes impact on older Australian citizens? How will they impact these hardworking Australians whose contributions over a lifetime have supported Australia to prosper both socially and economically? International evidence has shown that when forced to make a choice people often have to choose to go without medical care. They have to choose to stop taking certain medications. They have to opt out of preventive care and they have to opt out of follow-up care. The Chief Executive of the Councils on the Ageing in Australia says that out-of-pocket health expenses are already a barrier for older people to visit their doctor, with many telling their COTA representatives that they delay seeing a doctor or just do not go at all, because of the cost.

We are not talking about luxury expenses. Older Australians who forgo health care will be sicker and their quality of life will be further eroded. For me, knowing the impact the government's cuts will have on the quality of life of these valued members of our community is enough to know that they are a bad idea. Perhaps, however, this is not enough to convince the government. So, beyond the health issue, I urge the government to consider the economic impact of their proposed changes. If compassion and empathy for the health of older Australians is not enough, let's look at the economics. Forcing our older citizens to make choices that negatively impact their health will not result in savings. It will increase the cost to our healthcare system. People will become sicker and will need more expensive hospital care. Our hospitals will be under more pressure as they tend to a sicker population and they will find their emergency rooms filled with those who cannot afford to go to their GP.

Unfortunately, up to now the government do not seem to recognise the economic impact on our healthcare system. They want to combine a GP tax, an increase in the costs of prescription medication and an increase in the cost of diagnostic tests with the removal of $3 billion dollars from our public hospitals. So, as our citizens require more urgent hospital care and head to hospital emergency rooms because they cannot afford to go to their GP, our hospitals will have considerably less resources to support them. This leaves our healthcare system in a terrible place, but it is a terrible place that has been consciously constructed by an irresponsible government that is incapable of caring for those most in need. The combined effect of all of these measures is to erode the quality of life of older Australians and, most markedly, to erode the quality of life of low-income older Australians. It reflects the government's lack of concern for notions of equal opportunity and fairness, in particular as they apply to our older citizens.

Let us not forget that this is a government that is also determined to change the indexation of the age pension. I think this is absolutely worth mentioning in the context of this debate and the points I have been making. This will leave older Australians who rely on the age pension $80 a week worse off within 10 years. The Treasurer himself has accepted the Parliamentary Budget Office forecast that if this legislation is successful it will result in $23 billion less being spent on the age pension. That is $23 billion less going into the pockets of ordinary Australian pensioners.

Despite this acknowledgement by the Treasurer himself, recently in the ACT, Liberal Senator Zed Seselja sent out letters to seniors in Canberra deliberately misleading them about the impacts of his party's budget on pensioners and self-funded retirees. In the letter he tells seniors that the age pension will continue to rise twice a year. What he does not tell them is that the changes his government is trying to impose mean that the rise will be less than it otherwise would have been. He does not tell them that the value of the age pension will be eroded over time in relation to the cost of living, to the tune of $80 a week. He also makes absolutely no mention of his government's intention to get rid of the seniors supplement, removing almost $900 from the pockets of many Australian seniors.

The legislation before the Senate today is just one part of a range of changes the Abbott government is making that will hurt older Australians. All of these changes will make it difficult for seniors in our community to enjoy the pleasurable things in life. More ominously, they will require some seniors to make the choice to forgo preventive care, to forgo follow-up health care and perhaps, most disturbingly, to forgo health care at all. This government is trying to reduce the quality of life for older Australians who have put in a lifetime of hard work, and they ought to be condemned for it. Labor will not be supporting the legislation that seeks to facilitate this. We will fight against increasing the co-payment for prescription medicines, we will fight against the GP tax, we will certainly be fighting against axing the seniors supplement, and we will fight these together with the community as we seek to have fairness and what we all understand to be Australian values restored.

6:58 pm

Photo of Nova PerisNova Peris (NT, Australian Labor Party) Share this | | Hansard source

I too rise to speak on the Social Services and Other Legislation Amendment (Seniors Supplement Cessation) Bill 2014. My colleagues Senators Lundy, O'Neill and Lines quite beautifully articulated how upsetting this bill is and the effect it will have on our senior citizens in Australia. They also spoke about the many broken promises of this government and the pain that this legislation will cause across Australia. I rise to speak predominantly about my backyard, the Northern Territory.

Seniors in the Northern Territory already face the highest cost of living in Australia. Every price increase, every tax increase, every cut by the Abbott government hurts more in the Northern Territory. Every cut by the Abbott government to the assistance that people in need receive hurts more in the Northern Territory. The new fuel tax hurts more in the Northern Territory, where we already have the highest-cost fuel in Australia. Acting Deputy President Sterle, you would know how expensive it is for fuel in remote places. In some places, we pay between $2 to $3 a litre, which is absolutely outrageous for people in the community at large.

The new GP tax, as we have already heard, will hurt more in the Northern Territory because we have lower bulk-billing services than the rest of Australia. More people will be forced into our overcrowded emergency departments, which are the busiest in the nation. The cut to the Defence pay increase will hurt most in the Northern Territory, where we have the highest proportion of Defence personnel in the country. The cuts to hospital and school funding will hurt the most in the Northern Territory, where we have the lowest education and health outcomes in the country.

Seniors and our elderly in the Northern Territory are extremely concerned by the plans to sell the Territory Insurance Office—known as the TIO—which are backed by the Abbott government. Right now, seniors and all Territorians fear the inevitable: that the sell-off of the TIO will increase insurance premiums, given our history with floods and cyclones. Right now, Territorians are hurting. The Abbott government has made our future infrastructure funding dependent upon the TIO being sold. This legislation, right now, that ends the seniors supplement—which is money that our pensioners depend on and money that our pensioners account for—will hurt so much in the Northern Territory. These are our elders. We should be looking after our elders. Where is the love and where is the respect for our elders and for the senior citizens of this country?

That is why seniors right around the Northern Territory are leaving. The Northern Territory economy is booming—everyone says that we are open for business—but our population growth is amongst the lowest in the country. That is because our cost of living is so ridiculously high. When I meet with seniors in the Northern Territory, as I do regularly, they tell me time and time again that their friends are packing up and leaving due to the cost of living. According the latest population statistics, the number of people who are leaving the Northern Territory for down south has jumped dramatically. In fact, our net interstate migration is up 150 per cent in the last year, despite our booming economy—so more people are leaving the Territory than are coming. Our seniors are leaving in droves and this bill will make it worse.

This bill attempts to end the seniors supplement. This is a cut of the $999.4 million that supports 300,000 older Australians. Again, where is the respect and the love for our elderly? These are people who currently get the seniors supplement that is available to Commonwealth seniors health card and Veterans' Affairs gold card holders. It is paid annually, as we have already heard today, and is currently at a rate of $886.60 for singles and $668.20 for each member of a couple. The latest data shows that there is modest 767 senior Territorians who are recipients of this seniors supplement. This might sound dramatic, but this could be the breaking point for these 767 seniors in the Northern Territory. This will be the thing that pushes them over the edge.

Acting Deputy President Sterle, I am sure you have heard me talk in this chamber many times about the power bills in the Northern Territory, which have gone up 30 per cent in the last 12 months. Many seniors now have to live without air-conditioning as we move into the hottest time of the year. They are already struggling and this will tip them over the edge, as I have already said. Without this assistance, they will not be able to pay the bills for the very basics in life. This is what this supplement is supposed to do. It is currently paid to older Australians, our elders, to help them pay regular bills, such as power, rates, phone and car registration. These four things are the things that are going up in the Northern Territory and this is hurting the senior citizens of the Northern Territory.

The previous Labor government brought in this supplement to assist our eligible seniors with the cost of general living expenses. What the coalition government has done is to increase costs and it is now cutting this assistance. The member for Solomon promised to make life easier for our elderly Territorians and our seniors, yet she has voted to increase these costs for our seniors. She simply has voted to take this assistance away from our seniors who simply cannot afford it. She has promised our seniors no nasty surprises and then she has hit them with one of the nastiest surprises of all.

I condemn this legislation. I feel sorry for the 767 seniors in the Northern Territory who simply cannot afford this legislation.

7:05 pm

Photo of Nick XenophonNick Xenophon (SA, Independent) Share this | | Hansard source

At the outset, I indicate that I will not be supporting this bill. The government talks a lot about the need to repair the budget and end the age of entitlement. In theory, I have no problems with either of those aims, but I cannot understand why the government has chosen again and again to try to squeeze those savings from social services, health and education, which are arguably the least entitled sectors of our society.

Why would we seek to limit access to social services payments even further when we have companies receiving huge corporate tax breaks? I am not saying those tax breaks are inappropriate; I saying that it is a question of balance. If you are going to cut from one sector, you should cut fairly, equally and proportionately in respect of those cuts. For instance, when mining companies receive billion-dollar profits and are still receiving a diesel fuel rebate, that needs to be taken into account. I am not saying that we should get rid of the diesel fuel rebate; I am saying that they are not getting a cut to that, but you have pensioners getting a cut with this seniors supplement cut that is being proposed—and when companies like Apple and Google can funnel their profits offshore and avoid paying tax in Australia.

The government needs to understand that these measures are hurting their own constituents and, in many cases, their own voters. Anyone and everyone who has spoken to me about these budget measures has heard the story of my Aunt Effie. A big cheerio if she is listening. I am going to tell the story again for the record. My Aunt Effie is a self-funded retiree. She has been in this country for over 50 years, along with my Uncle Nick. They migrated here from Cyprus. They have both worked incredibly hard. They have raised two daughters and have five wonderful grandchildren. She and her husband have worked their whole lives to support themselves and their children and they now live, like most retirees, in comfortable but modest circumstances. Effie is one of the kindest and most gentle people I know, and I think it is fair to assume that, at the last election, she probably voted for the coalition. But, when I spoke to her after the budget, for the first time in my life she was fuming and she was upset. The seniors supplement she receives allows her the rare opportunity to buy treats for her grandchildren. It is her chance to spoil them a little and it means a lot to her. Effie knows that she is better off than a lot of others, but she has to worry about power and utility bills like everyone else. She is not rolling in it; she has worked very hard to have modest but comfortable circumstances. She is angry and upset because the government that I think she voted for are going against their promises, and it is impacting on her and her friends. This is just one small story. And, as I said, Effie is in the fortunate position of being able to survive better than others without the supplement. But it is not an entitlement; it is something on which I think that, in her modest circumstances and as someone who has paid her taxes over the years and who has worked very hard doing double shifts, just like my uncle, she feels that they are being unfairly targeted.

There are many others, however, who will struggle if this payment is removed. During the Senate committee inquiry into the original social services bills, concerns were raised about the effectiveness of the supplement as a form of support. If these concerns remain, surely it would be better to examine the supplement and determine whether it should be amended rather than to withdraw it completely. My concern is that a small percentage of the population who are, for one reason or another, on small incomes are bearing the burden of the government's proposed budget savings.

Earlier this year, research from the National Centre for Social and Economic Modelling, NATSEM, into the budget measures found that they would have a significant impact on those who are struggling most. According to the NATSEM report, the poorest 20 per cent of Australian families will contribute $1.1 billion more than the richest households towards the budget repair. Most of this is due to family benefits, pensions and other social security payments. By contrast, the wealthiest 20 per cent of households will, in some cases, pay 40 per cent less than the poorest 20 per cent of households. I am not arguing that these savings should not be made, but I am saying that the government is going about collecting them in a way that is manifestly unfair. I am more than willing to support measures that target needless expenditure, but this is not one of them.

7:10 pm

Photo of Jacqui LambieJacqui Lambie (Tasmania, Palmer United Party) Share this | | Hansard source

I rise to speak to the Social Services and Other Legislation Amendment (Seniors Supplement Cessation) Bill 2014. This bill is to amend social services and veterans legislation from 20 September 2014 to cease payment of the senior supplement for holders of the Commonwealth Seniors Health Card or the Veterans' Affairs gold card. The government are making it easy for me to vote 'no' to their legislation and to continue my campaign to force Mr Abbott and Mr Hockey to make a fair pay offer to the men and women of our Australian Defence Force. This legislation will take money away from Tasmanian seniors and veterans in the name of budget repair. So I would have opposed this legislation even if I did not make the denial of a fair pay for our Defence families a matter of conscience.

I was warned about this bill, along with three other bills, described by the president of the Vietnam Veterans Peacekeepers & Peacemakers Association as 'the four nasty government bills'. I will read from an email my office received from the national president, Mr Tim McCombe:

There are four nasty government bills before Parliament which, if passed, will, over time, drag Veterans Affairs pensions further and further behind community income standards.

You may not notice it at first because the half yearly indexation catch-ups will continue. It's just that those indexation catch-ups will be reduced.

And as those small reductions feed on each other, the falling behind accelerates.

President Mr Tim McCombe writes:

To achieve its desired degrading of Veterans Affairs pensions, the government has introduced four pieces of legislation into Parliament.

With the Coalition government having a majority in the House of Representatives, all four bills are expected to pass despites some opposition from Labor, the Greens and the Palmer United Party.

They must then go to the Senate where the government does not have a majority.

Three have already reached the Senate and the fourth is expected to arrive soon.

The odious bills are:

Social Services and Other Legislation Amendment (2014 Budget Measures No. 5) Bill 2014

        Social Services and Other Legislation Amendment (Seniors Supplement Cessation) Bill 2014

          Social Services and Other Legislation Amendment (2014 Budget Measures No. 4) Bill 2014

            Social Services and Other Legislation Amendment (2014 Budget Measures No. 6) Bill 2014

                  President Tim McCombe further writes:

                  Just which Senators will vote in favour of degrading Veterans Affairs pensions and which will vote against this degrading is yet to be seen—

                  although we have seen one today—

                  But we believe the Greens and the Palmer United Party are likely to vote against all the measures degrading Veterans Affairs pensions. We believe, disappointingly, that while Labor will vote against most of these proposed downgradings but may vote in favour of some of them.

                  We shall be watching and reporting.

                  I have to congratulate all the ex-service organisations in Australian and, in particular, Mr Tim McCombe, President of the Vietnam Veterans Federation of Australia for their initial service to the country. They put themselves in harm's way for our freedom, and now, in their golden years when they should be enjoying their grandchildren, they once again are watching their mates' backs. They are carefully studying legislation put before this place and holding us to account, and I greatly appreciate their advice and wise council. It is my honour to give voice to these great Australian patriots' feelings and concerns in this Senate. It is what I was elected to do, and now that I have declared that I will not be bound by party discipline on these matters of conscience I will never fail them.

                  After those general comments, I turn to particular provisions of the Social Services and Other Legislation Amendment (Seniors Supplement Cessation) Bill 2014. Seniors supplement is a quarterly payment targeted at self-funded retirees—persons of retired age not receiving an income support payment—and to older veterans over 60 years of age who hold a gold card for a medical condition. The payment is designed to help these older Australians to pay for the increasing costs of living, including bills like power, rates, phone and motor vehicle registration. The next payment of seniors supplement to eligible people is due in December 2014.

                  The seniors supplement is currently $876.20 for singles and $1,320.80 for couples, combined, per annum. Men and woman who fought for this country rely on this payment, often just to make ends meet. The government claims it will achieve savings of $1.1 billion over five years from 2013-14 by ceasing the seniors supplement.

                  The government savings, in reality, is Liberal spin doctor speak for: 'We're going to steal $1.1 billion of your money from our elderly, seniors and veterans.' I will not be party to this political crime. I will not, like the Nationals, become an accomplice to this Liberal crime, not when Australian politicians have awarded themselves over the last decade an average pay rise which is more than double that of the members of the Australian Defence Force.

                  The parliamentary library background research I commissioned for my private member's bill shows that in one year alone—2012—Australian politicians were awarded a 34.3 per cent pay rise which took their base rate salary from $140,910 to $190,550. This was an increase in one year of almost $50,000, or $49,640, for an Australian politician while an Australian soldier—a pay band 9 corporal, now on $76,000 per annum—received a 2.5 per cent pay rise, or approximately an extra $1,900 per year. Sadly, the parliamentary library research reveals for the first time that the average yearly rise in Defence pays over the last ten years is approximately 3 per cent. This stands in stark contrast with the average yearly rise in politicians' pay, which, since 2004, is almost 7 per cent. The politicians' pay rise included in the total the 2012 pay rise of 34.3 per cent.

                  In closing, I once again condemn the Abbot Liberal government for bringing this cruel legislation before the parliament and, on behalf of the people of Tasmania, register my strong opposition to this legislation.

                  7:19 pm

                  Photo of Carol BrownCarol Brown (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Families and Payments) Share this | | Hansard source

                  I too rise to speak on the Social Services and Other Legislation Amendment (Seniors Supplement Cessation) Bill 2014. It has been more than four months since this government handed down the worst budget in living memory. In October, the Labor Party forced the government to abandon legislation that was before the Senate. We won the fight on that day, but the battle is not over. In an extraordinarily arrogant move, the government also reintroduced their savage budget cuts into parliament in a number of separate bills. Let us make no mistake: Mr Abbott still wants to cut the pension; Mr Abbott still wants to slash support for struggling families.

                  Debate interrupted.