Wednesday, 22 March 2017
Social Services Legislation Amendment Bill 2017; In Committee
Labor opposes schedules 1, 3 and 4 in the following terms:
(4) Schedule 1, page 3 (lines 1 to 21), to be opposed.
(5) Schedule 3, page 6 (line 1) to page 16 (line 35), to be opposed.
(6) Schedule 4, page 17 (lines 1 to 9), to be opposed.
I have heard all of the debate tonight, and I think the debate has been very good, especially from Senator Lambie and Senator Gallagher, who have actually experienced relying on social security to help them and their families. Not too many in this place would have had to rely on that position, and that is why Labor sees social security as absolutely essential to have a decent society in this country. That is why we are opposed to this bill, because this is not the end of the cuts that this government is proposing. I am not sure if, in the negotiations that took place between One Nation, Senator Xenophon and Senator Hinch, the government indicated that this was only the first tranche of cuts to social security in this country. I listened to Senator Cormann when we were discussing the bill today, and this is what he said:
'These measures have been around for so long—why are you persisting with them?' But the government is persisting with them. The government is continuing to seek to legislate, and it is true that we have worked with crossbench senators because Labor and the Greens in relation to these measures were not prepared to pursue further budget repair, even though it was necessary, given the mess Labor left behind.
I do not know what you would call the fiscal and economic position that you are in at the moment, but what we are not prepared to do is simply deal with budget repair at arm's length from the implications it has for ordinary families in this country. Senator Cormann said:
Today is the next instalment. Building on the progress that we made in the initial omnibus savings bill, we will be able to secure more savings today. There will be more work to do after today, but this is as far as we believe the Senate will be prepared to go on this occasion, and that is what we are putting forward.
So what this government has clearly said is that this not the end. No doubt what it really wants to do is go back to the 2014-15 budget and actually implement all of the so-called budget repairs, at the expense of the social security system in this country.
It was not only Senator Cormann who raised this position today. It was also the Treasurer, Mr Morrison. He was asked on Sky News by Peter van Onselen: 'There are a whole series of saving measures that were in the old omnibus bill that are not in the new one. What is the status of those?' Morrison said, 'Well, these are measures that continue to stand as government policy.' So we have got both Senator Cormann and Treasurer Morrison saying they want to pursue those zombie measures. Let us just remind ourselves what those measures are: cuts to paid parental leave, where 70,000 mums will be worse off; scrapping the energy supplement; a billion dollar cut to pensioners, people with disability, carers and Newstart recipients; a five-week wait for Newstart, forcing young people to live off nothing for five weeks before they can access income support; cuts to young people between the ages of 22 and 24 by pushing them off Newstart onto the lower youth allowance—a cut of around $48 a week, or almost $2,500 a year; scrapping the pensioner education supplement and education entry payment; and cutting the pension to migrant pensioners who spend more than six weeks overseas. That is the government's next tranche. They are not giving up on that.
I take the view that they have not given up what they wanted to do in the 2014-15 budget. They thought the 2014-15 budget was so good that they cracked out the Havana cigars and the red wine. They thought it was brilliant. Senator Cormann and the then Treasurer, Joe Hockey, clapped each other on the back about what a great job they had done. But what this does is it freezes payments. For ordinary families that freeze is the difference between keeping their car on the road, getting a new battery for the car or fixing up a couple of bald tyres and registering their kids in community sport. It is the difference between paying fees for a bit of soccer—keeping the kids in the game with everyone else—or paying for a school camp or buying small gifts at Christmas and birthdays. It means living in hope that the washing machine does not clap out and that the fridge keeps running, but maybe having a few dollars there to help.
But that is not the only thing this government is doing. We have to see this in the context of what they want to do. They want to go back to the 2014-15 budget, and, in my view, they also want to go back to a position where penalty rates are cut across all awards in this country. If penalty rates disappear in this country, we will end up like the United States of America: we will have no decent underpinning to pay rates in the country; we will have no penalty rates on the weekend; people will depend on tips; and, when they need social security, social security will not be there for them. That is where we are with this government.
I say to Senator Hinch, I say to One Nation and I say to Senator Xenophon: if you agree to this tonight, it is only the start. I am not sure if you were told it is only the start, but it is. That is where we are: where the working poor, the unemployed, the sick and the needy in this country are pushed to the side for an American system. That is why we say: 'Enough is enough. We are not prepared to support this bill.'
All the words that you hear from Senator Cormann are about how it does not really affect anyone and how no-one will lose any money—but they will lose money. This is only the first attack. The attacks will continue from this government. It is outrageous that Senator Hinch, Senator Xenophon and his team, and One Nation—well, what do you say about One Nation? They will just do whatever this government does. They used all the Liberal talking points. Senator Hanson used all the Liberal talking points very badly, I must say, in her contribution. But she is the same as any other Liberal member. As I said tonight, she really should close the circle and she should apply to rejoin the LNP Queensland, because that is where she belongs; that is where One Nation belong. If there are any working class people who think One Nation will help them, well, have a look at Senator Roberts, who comes in here attacking the only institution outside the progressive party, the Labor Party, that looks after working people; continually attacking the trade union movement. If the guy had any sense, which we know he doesn't, if he had any comprehension, which we know he doesn't, if he had any feelings for ordinary working people, which we know he doesn't, he would not be coming in here making the speeches he makes—absolutely obnoxious speeches, outrageous speeches. He has no grasp of what it means to be a welfare recipient—someone who is poor and someone who is needy. He absolutely deals in fairytales off the internet. He runs all that rubbish in here and says they are going to be a party of the future. Well, if that is the party of the future, this country is doomed.
These amendments will maintain one aspect of the bill: they will get rid of that first tranche—that is what it is, the first tranche—of attacks on social security in this system. We know what the second tranche will be: the zombie features from that last omnibus bill. Then you will see us going back to the original 2014-15 budget, and if you add on top of that cuts to penalty rates, then the living standards of the poor people in this country will be decimated. I ask that amendments (4), (5) and (6) on sheet 8104 standing in my name be dealt with now.
I propose to speak briefly on behalf of the government in relation to all of the amendments that Labor have circulated on this bill. The government does not support the amendments moved by Senator Cameron on behalf of the opposition. The effect of the amendments he has circulated would reduce the savings generated from this bill from about $1.7 billion over the current forward estimates to just $30 million over the current forward estimates period. Agreement to these amendments would put at risk the savings the government has identified to facilitate the important childcare reforms to be delivered. The opposition are opposing savings measures that are fair and reasonable. Indeed, they are opposing savings measures that they themselves in the past have pursued. Opposing indexation in schedules 1 and 4 is a lever, indeed, that has been used by successive governments, including Labor in government, to realise budget savings by slowing the growth in social security expenditure. Again, I confirm that nobody will end up receiving less in dollar terms. They just will not receive the same level of indexation.
For the benefit of Senator Pratt, I remind her again that the government that she was a part of opposed the indexation of all family tax benefit A and family tax benefit B supplement payments for a total of six years. If you want to check it out, that was in the Labor 2011-12 and 2013-14 budgets, and that was on top of reducing indexation for all family tax benefit A payments in Labor's 2009-10 budget, which was saving you back in 2009-10 about a billion dollars over the then forward estimates period. When Labor pursue these sorts of savings in government, we would say it is a sensible way to do it. When Labor pursue these sorts of savings in government, Labor describe them as sensible fiscal management. When we pursue these sorts of savings in government in order to reinvest the money in a very important reform, Labor come out with all their rhetoric on how we are cold-hearted and how this is nasty and terrible, and how we are ripping money off families. We are not ripping money off families.
We are reforming the family tax benefit arrangements and childcare arrangements in order to provide better support to families which need access to affordable and flexible childcare arrangements. We are rebalancing government support towards lower- and middle-income families in particular, and we are paying for it by making a sensible adjustment—in particular, in terms of the most significant savings in this bill—to the indexation of family tax benefit payments.
For these reasons, the government will not be supporting any of these amendments.
Minister, you have raised some issues there. I just want to ask you some questions before we go to the vote on the amendment. One of the propositions that you have put forward that we are prepared to consider is the automation of the income stream review process. We do that on the basis that if that automated review process comes in, it can actually be managed effectively and properly by the government.
As you are aware, we would not have a lot of confidence in that, given what has happened with the DHS system. There has been much criticism of the government's capacity to actually handle IT. The former head—the chief digital officer—Paul Shetler said that it was difficult for him to watch successive IT failures, which he described as 'cataclysmic', and, 'Not a crisis of IT but a crisis of government'.
If there is support for this automation, what have you done to make sure that this automation can be done effectively and efficiently, and will not be a cataclysmic failure nor another crisis of government?
The government is very confident that the compliance measures that Senator Cameron is referring to are being implemented competently by the very hardworking officials at the Department of Human Services. We are very confident that the automation of income stream reviews will deliver appropriate efficiencies, which will be delivered in a competent way. You would expect me to say that.
The current regular superannuation and income stream review process will be automated by requiring income stream providers to provide recipient data on income streams directly to the Department of Human Services. This change will apply to all income streams, including account-based income streams, term annuities and defined benefit income streams. The outcomes of this policy will be reduced red tape and regulatory costs for income support recipients. So it seems better for income stream recipients and income stream providers through reducing double-handling and the need for income stream providers to provide information to recipients, which they in turn have to provide to DHS. This is a measure that really makes the system more user-friendly, both for the DHS clients and for the relevant providers.
Thanks, Minister. I hope you are confident that this can be implemented.
Is it correct that this will impact on 1½ million families? And is it correct that around 588,000 of these families are on the maximum rate of family tax benefit A, meaning that their household income is less than $52,000? What is the impact of this measure on families?
The question that you were asking me about automation does not impact on 1.5 million families; in the first calendar year it is expected to impact on around 5,255 recipients, who will have an average debt value of $2,138. Essentially, this will reduce future customer debts through the provision of more accurate data. In the first calendar year it is expected that around 5,700 recipients will have their payment reduced by an average of $49 a fortnight, based on what they are actually meant to be receiving and based on more accurate information.
I assume that Senator Cameron is asking me about the impact of the family tax benefit indexation pause. The first point I would make is that the number of families that are impacted by this measure is the same number of families who were impacted by similar measures pursued by the Labor government, including a freeze in indexation over a six-year period on all family tax benefit A and B supplements. It is the same number of families who were impacted by the freeze of the reduction of the indexation arrangements over an extended period for all family tax benefit A payments in the 2009-10 budget. I can confirm that the number of families impacted in 2017-18 from this measure is expected to be 1.4 million families.
By our calculations, families on the maximum rate of family tax benefit A will lose around $170 per child under 13 over the two years and around $220 per teenager. Is this correct?
You cannot actually make blanket statements like that, because it really does depend on the individual circumstances of individual families. Family tax benefit payments depend on the various factors, including the age of the child. It obviously depends on your income levels. You are referring to people on the maximum rate of pay.
What I can tell you in relation to this is that this measure will contribute to ensuring the ongoing sustainability of the family payment system. The measure does apply to the maximum standard base rate and approved care organisation rate of family tax benefit part A and the maximum rate of family tax benefit part B. The lower income free area would continue to be indexed. That is an important point which means, depending on your level of income, you will actually continue to receive increases in payments, just not because of indexation in payment rates but because you move past certain eligibility thresholds. Other family tax benefit rate components—namely rent assistance, the newborn supplement and the multiple birth allowance—will also continue to be indexed.
All 1.4 million family tax benefit families will be affected by this measure, but that is actually the advantage because it means that the impact to achieve the $1.3 billion saving is minimised and that is precisely why Labor has pursued similar measures in the past. The family tax benefit rates—this is important to say—are not being reduced. Families will continue to receive assistance at current rates for another two years at least. Some families will receive more depending on their personal circumstances. In 2017-18, families receiving family tax benefit part A will forego increases of up to around $73 per child under 13 or around $91 per child aged 13 and above. It is important to also recognise that this proposal would not disproportionately affect regional Australians.
I will ask you some further questions in that area. In the very short second reading speech, the minister made the point—and you have just made it there—that some families will still have increases. Can you tell us how many? As I understand it, what will happen is that those who are at the bottom of the threshold will then come into the lower threshold. How many are you projecting are in that space that otherwise would not be affected?
The question that Senator Siewert is asking cannot actually be answered because it depends, in all sincerity, on a range of factors that we do not know about, including what happens to a family's take home pay over that period. What I can say is that no family will receive less as a result of this saving than they are currently receiving. Every family will at least get the same amount they are currently receiving for the next two years, all other things being equal. If they end up earning more money, the means test obviously will kick in. If they earn less money they might qualify for a higher rate of payment. If their kids grow older, as kids do, then obviously progressively they are entitled to a higher payment. So there are various factors that come into play, and I am not able to assist Senator Siewert with the specific question she is asking.
The point I would make again is that in terms of achieving savings in this space there is a reason Labor did this in government before. Senator Wong quite unfairly criticised Senator Hanson for her contribution. Senator Hanson was quite right. Labor in government froze the indexation of family tax benefit A and family tax benefit B supplement payments not for two years but for six years, and saved about $1 billion on that. In 2009-10 Labor delinked the indexation of all family tax benefit A payments from the pension indexation arrangement, saving, in 2009-10 dollars over the then forward estimates, about $1 billion. Of course, $1 billion in 2009-10 is significantly more now.
That is what Labor decided to do at a time when we were, quite frankly, compared to now, in a higher inflation environment. We are in a low-inflation environment. To pause indexation in the current circumstances, we believe, is a fair and reasonable way to release the necessary savings in order to be able to invest in the very high-priority childcare reforms, which are of course geared to provide better, more targeted support and more flexible and affordable access to child care for working families.
The claim is made in the second reading speech that 'many families will still see some increase in their payments'. So the same mob that is saying this is not a cut when they are taking $5.5 billion worth of funding out of the family tax benefit—they do not call it a cut—are now saying: 'Trust us, some families will see an increase, but we can't tell you how many. Just believe us.' Not being able to find some detail earlier, I actually did ask the library to look at this and see what they thought of it. They thought that a small number of people will go from the reduced maximum rate to the maximum rate, and a very small number of people will in fact benefit. That is their take on this. That was after this was tabled. I was thinking that you may have more detail about this, Minister.
I will just talk you through three quick cameos. That will give you a flavour as to why this is not entirely straightforward.
First, we have a family of two parents, with one working full time on $83,000 per annum and the other working part time on $20,000 per annum—so a household income of $103,000 per annum—with two kids aged 10 and 15. Under current arrangements they would obviously receive family tax benefit payments at the lower level of $28.80 in 2016-17, which would increase to $40.31, $59.28 and then $79.78 under current arrangements. Under the revised arrangements with the pause in place, these payments would still increase per fortnight, from $28.80 to $34.42, $42.28 to $61.39. The reason for that is the rate of family tax benefit A continues to increase despite indexation pauses to payment, although by less. This is because the threshold for the income test, which reduces the maximum rate of family tax benefit A, still gets indexed and continues to increase year on year, therefore reducing the amount that is lost to the taper rate.
I will give you a second cameo, this one at the lower end. There are two parents, with one working full time on $41,000 per annum and the other working part time on $9,000 per annum, so the household income is $50,000 per annum. There is an assumption that income does not increase, with the $50,000 household income being below the level at which maximum rates of family payments are reduced under the taper rate. There are two kids, aged 10 and 15 years old. Again, I will run you through the numbers: at present, under current arrangements that family would get $503.68 this financial year, $511.68 the next financial year, $523.47 the following year and $535.55 in 2019-20. Once the pause is in place, the payments will still increase, though by less—from $503.68 to $504.24 to $505.36 to $517.16. This is because, as this family is receiving the maximum rate of family tax benefit A, their family tax benefit A remains fixed at the same nominal level, but the rate of family tax benefit B continues to increase as the threshold for the income test on the lower income, which reduces the maximum rate of family tax benefit B, continues to be indexed, therefore reducing the amount that is lost to the taper rate. You can see this on page 5 of A guide to Australian government payments, which I am sure you are familiar with.
Finally, there is a third cameo. It involves two parents, one working full time on $56,000 per annum and the other working part time on $9,000 per annum. The story is pretty similar. Household income is $65,000. There is an assumption that income does not increase, which, of course, would have other implications. They have two kids who are 10 and 15 years old. Under the current arrangements the payments would be $402.93 this year, followed by $416.55 next year, $436.20 the following year and $456.70 in 2019-20. That is under the current indexation arrangements. With the pause, these payments will still increase—from $402.93 to $409.11 to $418 09 to $438.31.
These are typical cameos, but there are many moving parts in these things. Every family is different, every family has its individual circumstances, so every family will be impacted in a slightly different way. But what I can say to you is that no single family will be receiving less in family tax benefit payments as a result of this pause in indexation than they are receiving this year. No family will be receiving less as a result of this legislation. We are only pausing the indexation of payment rates. That is something that Labor has done in the past for various payments over much longer periods, and for higher savings in today's dollars.
Let's try this another way. You have made calculations about the savings that you are going to make. For this group of people that you say will actually get an increase, you had to have factored into your calculations how much you think you are going to save and how much you are going to spend. What did you put into those calculations for that number of people? How many people did you put into your calculations for the savings you are going to make?
The calculation is relatively simple. There is an assumption that there will be a 1.5 per cent CPI next year and a 1.5 per cent CPI the following year. If you pause indexation, then, obviously, the number in aggregate is not going to increase by that 1.5 per cent indexation factor, and, fundamentally, that is what will help you identify the saving.
In other words, you have made this claim and you cannot actually tell us. You just want people out there to believe that some people are still going to receive an increase. In the second reading speech you also talked about $5.5 billion being saved from the family tax benefit changes over the medium term. I presume that is factoring in the fact that family payments will not increase as much as they would have done over that period. What term do you mean by 'the medium term', and is the $5.5 billion correct?
The $5.5 billion is correct, and the medium term is budget year plus 10, so it is till 2026-27 from the 2016-17 financial year. There was one thing that I particularly wanted to answer. If we are pausing indexation for two years, indexation will then start again from 1 July 2019 onwards. But it will be starting from the new base which has not been indexed for two years. There will be indexation moving forwards, but we do not catch up on the indexation that has not happened for the two years during which the indexation has been paused, so indexation from 2019 onwards will be from a lower base than it otherwise would have been, which is why there is a follow-on effect that comes to $5.5 billion over an 11-year period.
I think it is time to come clean, because you owe this to the Australian people. More importantly, you owe it to every poor Australian. You are taking money from them. I do not give a stuff which way you look at it. The freeze is taking money off them. They are not getting any increases. While everybody else is getting pay rises each year you are putting it on hold. While milk and bread go up you are freezing their payments. That is what is going on. That is the truth so please do not spin it. Shame on you!
So, since you have done such a shocking deed, I bet you are bloody proud of yourself, I can tell you. It is time you come clean. What dirty deals have you done with the NXT to get their vote? What dirty deals have you done with One Nation? I will give One Nation some advice very quickly. You know why Clive Palmer and PUP did not survive? I will tell you why they did not survive. It was because Clive did dirty deals with the Libs. He stopped doing what he had said he would do for the battler. He was full of it just like One Nation is. You are lying to the constituency that voted for you, but you know what, I do not mind.
The CHAIR: Senator Lambie, just take your seat for a moment. Please address your remarks to the chair, and lying is unparliamentary, so you need to withdraw that.
Madam Chair, I withdraw that. I will use 'misleading' then. Anyway, the Australian people are waking up to them so I do not really need to do much else in that department. If you do not mind, could you stand up and be honest to all those poor people out there and tell them what deals these people sold them out for, because you owe it to them.
The government obviously do not have a majority in the Senate so it is incumbent on us, in seeking to achieve a consensus through this chamber, to work with non-government senators, and that is what we have done on this occasion. On previous occasions we have been able to reach a consensus with Labor and that is a matter of public record. On previous occasions we have been able to reach a consensus with the Greens, and on this occasion we are very grateful that we have been able to reach a consensus on good public policy with One Nation, the Nick Xenophon Team, Senator Hinch, Senator Leyonhelm and Senator Bernardi.
We consider it to be our job to engage with all non-government senators to explain what the government are trying to do and why. We believe that in all of the circumstances the savings that are in front of the Senate are reasonable and fair, and we believe that the government's childcare reform package is an important package which will help working families. They will get better access to more affordable and more flexible child care, in particular, geared towards providing better support to low- and middle-income families. We are, of course, substantially responding to the recommendations of the Productivity Commission in terms of how that should best be done to ensure that there is downward pressure on the increases in costs of provider-driven child care, and the reforms are there for everyone to see.
We have engaged with Senator Hanson and we are very grateful for Senator Hanson's support. We have engaged with Senator Hinch and we are very grateful for his support. We have engaged with a whole range of other senators and we are pleased that we were able to reach a consensus.
I just need to make some comments here. One Nation has not done any deals with the government in relation to this bill. We have looked at the bill in relation to what is good for the Australian people. Until we actually start to realise that we are—
Senator Lambie interjecting—
I let you have your say.
The CHAIR: Order!
The fact is that the federal debt is $547 billion. The Labor Party are responsible for $400 billion, so the whole fact is that, until we start to pull this back and realise that, if we do not have the money there to fund future development in this country as well as pensions and people who are in need, nothing will progress in this country. No deals have been done. I have always looked at policy based on what is right for the Australian people, so I do not bargain with people. The whole fact is that I wish those on the other side would get rid of their political—
Senator Hanson-Young interjecting—
Thank you very much. They do not understand the position or possibly the intelligence of One Nation. We are a party that stands alone to look at the benefits of the policy, the legislation, that is put before this parliament and what is right for the Australian people. If the Labor Party put up good opposition legislation, I would vote for it, no problems, if I thought it was right for the Australian people. As we have done on occasions, One Nation—
Senator Hanson-Young interjecting—
If good policy were put up in this parliament I would support it, regardless of whether it was the government or the opposition. On occasions, One Nation has voted for the opposition. You will only get good government if you have got good opposition. I do not see it in this parliament, whatsoever. I see hypocrites in this place who are now objecting to legislation that they themselves imposed in the past. So the whole fact is that you need to look at the debt that we have here. It is not about—
Senator Hanson-Young interjecting—
I would like to say through you, chair, it is a blessing that the Greens do not control this country, because we would have nothing left here, whatsoever. They would destroy this country for what they want to do. With all the handouts that are happening, what will be left? Nothing. We need a balance. We need to look after those who are truly in need, and I totally agree with that. There are those battlers. Let's talk about the battlers.
Honourable senators interjecting—
A point of order, Madam Deputy President. On numerous occasions you have called other senators to order, but standing orders make it very clear that senators have the right to be heard in silence. There are some repeat offenders. I do not need to name them, but Senator Hanson does have the right to be heard in silence.
Thank you very much, Madam Chair. As I was saying, look at the legislation—and I am pleading with all sides here: the government, the opposition, plus the crossbenchers. We are in such debt in this country. The Labor Party—you cannot deny it—had $400 billion debt. The debt is now $547 billion. Look at the facts.
I hear a comment from the crossbenchers. What I have actually said in the past is that we should pull in the multinationals to make them pay their fair share of tax in Australia. I am trying to get a balance here. We can start to rein in the debt. If we do not start to rein in the debt we will not be able to look after the pensioners, the aged, the sick and the needy. You cannot keep giving and giving and giving. It does not work that way. We need to start being balanced in our views in this house. We are the leaders of this nation. Start working together. That is what the people of this nation want. Stop being so negative in what you are doing here. The people are listening and watching. And, as I have said, do not criticise me. I remember that it was just a couple of days ago, or maybe it was even yesterday, when I said that there should be a freezing of politicians' wages until we bring this budget back into surplus. Where were you? Where was Labor? Where were you on the other side of the chamber? You worry about your own pay packets. You do not care about the battlers or the people of this nation. You are a bunch of hypocrites—absolute hypocrites! That is what I say to you. Start looking at yourselves in the mirror, because you are bringing this country down. Start realising that we are the leaders of this nation. Show by example and start reining back in. Stop saying that people, putting a blanket over everyone, are the battlers of this nation. Look at who are the battlers. People are ripping off this system here. Don't you understand that there are people in this country who are truly battlers? We need to look after them. There are people who are ripping off the system. They are not—
Honourable senators interjecting—
The CHAIR: Order! Senator Hanson has the right to be heard in silence. Please respect that right.
There are battlers in this country who are doing it tough with escalating prices, trying to put a roof over their heads and food on their table and pay their escalating costs. It is extremely hard for them to hold a job in this country. I am sick and tired of hearing the Labor Party go on about jobs, when they do not protect the workers in Australia. We need to look at this bill in the right perspective. I think it needs to be reined in. We are not in a vote. I have listened to the minister tonight in his delivery. Those families on tax benefits A and B are not going to be affected. Nothing is going to happen. They are not going to lose their benefits for the next two years. They are not losing their benefits. Nothing is going to change.
Honourable senators interjecting—
I will ask that of the—I am asking that. They are not losing their benefits whatsoever—that is the bottom line. Those on the opposite side, you did not want to lose anything from your—
Senator Dastyari interjecting—
The CHAIR: Senator Dastyari, please allow Senator Hanson to continue her remarks in silence. That goes for other senators as well. Senator Hanson, have you finished your remarks?
Yes, I have.
Just very quickly, to confirm what Senator Hanson has just said, for the next two years every family will continue to receive the same payment they are currently receiving, all other things being equal. The payment will not be indexed—
Honourable senators interjecting—
As long as their other income does not increase. Payment rates will not reduce. Every family that gets benefits now will continue to get benefits. Nobody will get a lower benefit that what they are currently getting over the next two years, as a result of this pause.
I have some questions regarding the one-week ordinary waiting period. I note that the bill introduces a waiting period for new payment for different payment types. I am concerned that you are also playing with the definition of severe financial hardship versus experiencing a personal financial crisis. If you are introducing a waiting period, for example for parents who are experiencing a relationship breakdown, how do you differentiate between a financial crisis and financial hardship? For example, hardship might be a household with a mortgage, but a crisis might be someone who needs to break up a rental household and find a new rental. But it really does seem that you are putting in place a waiting period of one week with families at their most vulnerable time, while not having a clear definition of hardship versus financial crisis. I am very concerned that families will be left vulnerable.
This is actually directly addressed in the explanatory memorandum, under 'background':
A person will be taken to be experiencing a personal financial crisis if they have been subjected to domestic violence, incurred unavoidable or reasonable expenditure or in the circumstances prescribed by the Secretary in a legislative instrument.
There is obviously a level of discretion there that will enable the necessary flexibility to ensure appropriate personal or financial crisis circumstances and financial hardship are properly applied.
I do not really see the legislation differentiating between financial hardship and financial crisis. I can understand hardship might be over an ongoing period and a crisis might be unexpected expenditure, which might be related to needing to move house or the kinds of things that happen when families break up, but I am seeking reassurance that families who might be to move house—et cetera—will not be subject to this insidious, terrible one-week waiting period.
I really enjoyed your tap dancing! I loved it! Minister, it was so superb that I am surprised you are not in theatre! If you could just please answer my questions directly: what deals have been done and who have they been done with? I notice of the NXT is very quiet; they have not been up to speak and I have not seen them. They are probably hiding in shame. Minister, if you could please tell the truth to these poor people—you owe it to them. No tap dancing, straight down the line: what deals have been done?
On the Nick Xenophon Team, I am not wanting to speak for them but clearly they were keen to see the government's childcare reforms legislated. They understood that the government needed to identify savings in order to pay for it. We were able to reach an agreement on which savings they might be prepared to support. Obviously, there was a whole range of savings that they were not prepared to support. We reached agreements on those that they were prepared to support and that is reflected in this bill that we have introduced today.
I will rephrase the question: were there deals done to get the bill through? I can do this in 10 or 20 different ways. We can be here and I can keep this going; we could do it tomorrow morning. So please just answer the question and be honest—you owe it to the Australian people. You are trying to outsmart us all and it is actually not making you look very pretty. So, please, were there deals done?
As I have indicated before, it is the job of the government to seek to reach consensus across a majority of senators in order to get the government's agenda through. We do not have a majority in our own right. We were very grateful that we were able to reach an agreement with the Nick Xenophon Team, the One Nation team and other senators in support of the government's reasonable savings in order to pay for very important childcare reforms.
Is the minister going to respond?
Senator Lambie interjecting—
Minister, I noticed the financial impact statement has the phrase 'indicative financials'. I wonder if you can explain why? I wonder if you can provide us with the UCB impact over the forward estimates, disaggregated?
I am capable of reading that. We would like it for each of the financial years, as would otherwise appear. Is there some other table we can look at? It is done as an aggregate over the entirety of the forward estimates.
In relation to 2017-18 the pause in indexation is expected to save $230 million, in 2018-19 $560 million, 2019-20 also $560 million, and that comes to the number that is indicated in the explanatory memorandum. There are some small variations between cash and fiscal, but that is it, essentially, broadly.
I just want to go back to the question again for the poor people in South Australia, and trust me, there are a lot of poor people in South Australia. The only thing that South Australians and Tasmanians fight about is who has the biggest unemployment for the month, who is the poorest for the month. For the people of South Australia and the people of Tasmania we would like to know what deal you have done with the Nick Xenophon Team to take from the poor. I would remind you that that is why your Three Amigos are no longer in Tasmania. I would expect that, in the next federal election, if you continue this behaviour, which is a bad pattern of behaviour, you are going to lose more. If you could please answer the question so that those in South Australia and those in Tasmania know what sort of filthy, dirty deal you have done to push the poor further into the ground. You owe it to them. Grow a spine!
The CHAIR: The question is that schedules 1, 3 and 4 on sheet 8174 stand as printed.
The CHAIR: The question now is that the bill stand as printed.