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Tuesday, 13 September 1983
Page: 666


Mr ROBERT BROWN(4.00) —I doubt whether in the recent past a matter of public importance has been raised by the Opposition which is as cheap, as tawdry and as cynical as the matter it has raised today. The matter of public importance refers to the insecurity caused to Australian families by the Government's lack of an appropriate policy on retirement incomes. The question whether insecurity is a reality for retired people is a question of the extent to which their material security is adequately provided for. I should like to remind members of the Opposition that during the period they were in government, pensions in Australia, as a percentage of average weekly earnings, fell from 24. 4 per cent in December 1975, when they first came to government, to 22.2 per cent in March of this year when, finally, they were ejected from government. In December 1975 that represented a figure which had been achieved by the previous Labor Government as a result of a deliberate and continuing policy to achieve a pension rate of 25 per cent of average weekly earnings. As we can see from that figure, the aim was very nearly achieved; it was 24.4 per cent when we lost government at the end of 1975.

It is cynical for the Opposition-the former Government now in opposition-to claim that in some way, after a relatively short period in government, the policies of the present labor Government are bringing about any degree of insecurity for pensioners. It is not just the financial resources that are available to people over the age of 65 which determine the extent to which they feel secure or insecure. There have been occasions in the past, during the period of the former Government's term of office, when there were reasons for pensioners to feel a considerable degree of insecurity. In particular I refer to the occasion when the former Government-the Fraser Government-made a determination to reduce the indexation of pensions from twice yearly to once a year. That decision to take money out of the pockets of the pensioners in Australia was designed to save the former Government $50m a year. Yet we have records which show that, on average, each year during the term of the previous Government the tax avoiders and the tax evaders-those people for whom the previous Government showed so much concern and so much reluctance to pursue with any degree of determination-cost about $7,000m every year.

The former Government intended to take out of pensioners' pockets a miserable $ 50m a year. It willingly and with enthusiasm left in the pockets of its affluent Liberal Party members, Liberal Party benefactors and Liberal Party supporters, all of those tax evaders and tax avoiders who have been identified, not the $50m that it wanted to swipe out of the pockets of the pensioner but $7,000m every year. What would have happened? What could the Opposition have done in government if it had been really serious and attacked the industry of tax avoidance and tax evasion, if it had recouped that $7,000m every year? Instead of coming before the parliament at this stage with nonsense of this kind it would have been able to cement itself in government for as long as it could see into the future. With that $7,000m it could have given an annual handout to every individual pensioner-the two million of them in Australia-of $3,500 a year . But no, the former Government did not give a handout of $3,500 a year to the pensioners; it tried to take $50m out of their pockets and left $7,000m for its affluent and powerful friends because of its reluctence to attack with any degree of determination the whole area of tax evasion and tax avoidance.

The Leader of the Opposition (Mr Peacock) said that if at any time in the future Opposition members were returned to this side of the House-a most unlikely circumstance-they would repeal the assets test. I was interested to note that the Leader of the Opposition made no reference to any possible repeal of the proposed taxation arrangements on superannuation benefits taken in a lump sum. I was surprised that no undertaking was given by the Leader of the Opposition in connection with the reintroduction of an income test for those people over 70. There was no reference at all to those matters. Of course, he did make a reference to repealing the assets test. What does that mean? Let us put the matter into perspective, because all those people on the Opposition side have been rostering themselves to hawk around this country addressing pensioners , with the deliberate intention of adding to the confusion, the misrepresentations, the misunderstandings, so that they, by their very actions, could bring about an increased feeling of insecurity.


Mr Simmons —Hypocritical.


Mr ROBERT BROWN —Exactly. Of course it is hypocritical when Opposition members come before this House today and talk of the insecurity and confusion caused to retired Australians. It is nothing short of cynicism and absolute hypocrisy. Why do Opposition members not apply their efforts and any talents that may be available to them to going around the country and helping to allay the fear of the pensioners, to explain the reality of the proposed tax on lump sum superannuation, or to explain the realities of the proposed assets test? No, they will remove the assets test. What does that mean? Let me put it into perspective. It will affect a pensioner without his own home, who is paying rent and has a part time job in order to supplement the pension he is getting. He does not have a weekender or a car or a yacht or a caravan. Here is a single pensioner attempting to supplement his income. As soon as his income rises above $30 per week he will lose 50c in every dollar. As soon as his income-this money he is earning in order to supplement his pension-moves up above the tax free threshold, for every additional $2 he earns he will lose $1 from the pension and another 30c in tax. Out of the $2 he will lose $1.30, which represents for that pensioner a marginal tax of 65c in the dollar. Even the highest income earners in Australia do not pay 65c in the dollar; they pay 60c.

When the Leader of the Opposition tells us that when his Party gets back in government it will abandon that assets test, the Opposition parties will make sure that pensioners in the circumstances I have described will pay the highest marginal rate of taxation in Australia. Who are the people who will benefit as a result of the elimination of the assets test? Let me tell honourable members. In contrast to the poor pensioner who was taking a part time job in order to supplement his income, aged persons will benefit from the Leader of the Opposition's undertaking to abandon the assets test. For example, a pensioner with a home valued at $150,000 or more will benefit. He may have a Mercedes car, and his wife may have a Mercedes as well-one for each of them. They have their caravan, their yacht, their holiday home and their property trust investments, which appreciate in terms of their capital value. Those are the people who, as a result of the elimination of the assets test, will get the full pension. If members of the Opposition continue to hawk themselves around this country confusing and worrying pensioners, they had better go before them with some explanation for the position which they themselves have declared.


Mr DEPUTY SPEAKER (Hon. Les Johnson) —Order! The honourable member's time has expired.