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Wednesday, 16 June 2010
Page: 5678


Mr GRIFFIN (Minister for Veterans’ Affairs and Minister for Defence Personnel) (6:34 PM) —There are three main areas that have been raised and I will try and go through them in some detail. I will try to do them in the order they were received.

First off, on the issue of the F111 deseal-reseal, this was a government response to an inquiry that the opposition, when in government, refused to do. The day I made the commitment the then minister, the member for Dunkley, refused to make a commitment. He said that as far as he was concerned the position with respect to compensation and support for the deseal-reseal people was over, finished, kaput—that was it. So what we have here is a package of some $55 million, and every single dollar of that is in excess of what the previous government was prepared to do. That they have an interest in it now I think is laudable but late.

On the question about consultation, this was a response to a parliamentary inquiry that involved both sides of the parliament, that involved submissions from interested parties, that involved a series of hearings. As a result of that process, which was loaded up with consultation, a series of recommendations was made. In fact, there was then quite a deal of comment publicly about those particular recommendations. The government then considered those recommendations and that report and responded to them. The key reason there was not consultation in the final stages in the consideration of the response to the parliamentary inquiry report was that there were budgetary issues involved; it was part of a budget process. But in fact it was the consideration of a set of recommendations which had come out of a process which had involved extensive consultation.

Having said that, there was no doubt—and there was no doubt from the government’s point of view—that there would need to be discussions about the implementation of the system, because once we introduced what we were planning to do we would need to talk to parties with respect to the detail of implementation. And that is what we have been doing. The secretary of the department, I and others met with representatives of the deseal-reseal group in Brisbane a week or two after the budget to go through some of those concerns. Frankly, the reason we did it then was to give them some time to consider the question of what was there and for them to develop up their questions so that we could actually have a real discussion about how we go forward on this. The government is committed to working through those concerns and the intention, as the deseal-reseal group representatives know, is to have regular meetings with them to go through any of the particular questions that they might have in order to endeavour to resolve them.

As I said in the House at the summing up on this, one of the representatives there, Kathleen Henry, who had had a long involvement on this issue, said to me on that day that she thought we had got ‘90 per cent of this right’. That was subsequent to the discussion we had at the DVA office in Brisbane. Does that mean all the concerns have been addressed with respect to those who have concerns in this area? No. Frankly, they never will be, because of the nature of some of those concerns and the circumstances around them.

The shadow minister asked the question about when the implementation unit is going to be up and running. The answer is that it is. We are currently advertising the position for the key person who will be in charge of the unit, but the unit itself was established just before the budget in order to be available to take concerns and considerations from that time on. The commitment from this government’s point of view and from my point of view as minister is that we will work with those groups to resolve those concerns, to ensure that we have a system which gives those people who have developed conditions with respect to their exposures a fair shake, a fair go and compensation where it is appropriate as it is outlined under the legislation.

There are concerns about the operation of the administration in this area, and those concerns go back some time. This government is committed to working those concerns through. Again I stress that it is admirable that there is now concern on the other side of the House about how we might deal with the estimated $55 million additional support that will go to these people. But when all they were asked to do was to commit to hold an inquiry they would not even do that.

The next issue I will go to is the one raised by my good friend the member for Lyne, who has done his best today to test that friendship across a couple of issues—but that is okay. (Extension of time granted) Military superannuation is an issue of enormous concern within the wider ex-service community. There is no question about that. I think members are aware of that. But I think we also have to remember that it has not been a concern just now; it has been a concern for a long time. It has been a concern for a long time and it is an issue on which the previous government refused to take action. They refused to take action over more than a decade when it was a concern and when, frankly, the budgetary position of the government was such that they had a good deal more flexibility than we currently face as a result of the global financial crisis.

This government made a couple of commitments, and the issue of commitments was something that was raised by the shadow minister, and I will pick up on that in this process. Several commitments were made around the question of military superannuation. In the context of this particular issue, there was a commitment to have a review into the indexation method. That became the Matthews report, which came down with a set of recommendations that the government accepted. It is quite clear that the recommendations Mr Matthews came down with are at odds with what the ex-service community would have liked, wanted to hear and believed was appropriate. I understand that concern. I could go into justifying that in the context of the difference between a superannuation payment versus an income support payment versus a disability compensation payment. I have done that on other occasions but, given the shortage of time, I do not know if that is appropriate at this stage.

The issue that the member for Lyne was particularly interested in was where we are going from here. As I have said on the public record, the overall position of the government with respect to military superannuation is an issue which has been vexed for some time. We had the Podger review from the previous government, and when we released it and consulted with the broader ex-service and defence communities it became clear that they did not want it. That has been an issue for government to consider. We have to consider that and we will be making announcements with respect to how we go forward on this issue in the weeks ahead. I am fully aware and understand that there will need to be a firm decision from the government prior to the election, and I undertake to ensure that there will be.

On the indexation issue, though, I am not going to stand here and say that I believe that that is necessarily in any way going to deal with those concerns. Frankly, post-Matthews, the government faced a choice: can we suggest this issue is live at this time, or is it frankly fairer and more reasonable to make the point that in this environment and at this time it is not? We took the latter view, and we have been panned for it. I understand those concerns. Frankly, this is an issue which has been under consideration for quite some time by both governments, and it has not been acted upon. That point needs to be made. I know that ex-service organisations are going to continue to push with regard to these issues. I certainly am going to be engaging with them about these matters in the weeks and months ahead. But I am not going to lay out false hope that I think we are likely to resolve those concerns quickly or easily.

In terms of the question of submissions and where they might have gone, there has been a range of work done on this because we know it is an issue of concern. The question of that information is something we are still considering within government. As the member would understand, in those circumstances I really cannot discuss those details. But I do want to assure him I understand the significance of the issue.

I will move on to some of the other points made by the shadow minister. He made a couple of points. One suggested that this government had taken credit for certain initiatives taken by the previous government around the question of, for example, indexation around disability pensions. Guilty as charged. I do take responsibility for it. I take responsibility for it based on the fact that the key decisions that were taken mirrored, to a large extent, policy announcements that were made by me, as shadow minister, just before the 2007 budget. I accept that; I am guilty as charged. Ex-service organisations told me at the time and subsequently that there would not have been a change if we had not moved. I do that again on the basis that essentially the government of the day made a change in the 2007 budget but clearly had no intention of moving on this issue and did not move on this issue until September at the RSL Congress in the lead-up to the election because they felt they had to move because we had led the way.

I would also add that the policy document that the shadow minister refers to actually says that these were initiatives implemented in legislation under the previous government with mutual support. That particular document has some 42 commitments in it, and of those 42 commitments, as I score them, something like 32 have been implemented and nine are in the process of implementation. Some of those are things like the Vietnam veterans family study: the funding is there; it is just taking time for it to be done. (Extension of time granted) There is only one action that has not been taken up, and that was blocked in the Senate. So, in fact, action has been taken on the Commonwealth Dental Health Program, but it has been blocked in the Senate. I am sorry, I have not been able to get a commitment up, and the reason I have not is that the opposition opposed it.

On the issue of disability pension rates and the issue there around the MBR factor: the key commitment made before the last election—and it was mirrored in the debate for the legislation—was about the link to male total average weekly earnings. That was what the previous government promised; that was what we supported; that was what we did. The MBR and the formula associated with that is a mechanism that was utilised to achieve that outcome. The Harmer review of pensions, of income support payments, actually led to a change in the base rates. But the real point there was maintaining the intention of the formulas, which was to link the disability compensation payments to MTAWE or CPI, whichever is the greater.

The Treasurer’s comment in relation to the consideration of disability compensation payments in the context of the Harmer review has been taken out of context, because it was about considering the overall situation of what people were facing in terms of their income circumstances—the point being that those who were on compensation payments invariably have access to income support payments in addition to their compensation payments, as they should. The point with respect to that is that those Harmer increases went to those disability pensioners who were in the lower financial situation because they were accessing support payments and they therefore got those increases. But the key point in relation to the disability compensation payments was maintaining the link to MTAWE, and that was done. The formula alteration was to ensure that that was done into the future. It was necessary because of the nature of the mathematical formula employed to ensure that an outcome was achieved.

If you go to the debate—if you go to what the previous minister said when that legislation was being passed in the first place to increase the disability compensation payments prior to the last election—you will see myriad references by the previous minister to standards of living and male total average weekly earnings. The reason he referred to that was that that was what the debate was always about, that was what the link was always about, and that was what Labor’s commitment was always about. And that was clearly understood.

The debate subsequently has been to draw a link to the service pension. The service pension is an income support payment. The link was never about that when it came to the question of disability compensation payments; the link was always about maintaining their value within the broader community. It has been suggested that disability pensioners in the veterans affairs area have gone backwards. They have not gone backwards. The value of their compensation payments has been maintained to MTAWE, which was what they had always asked for in the past. And those disability pensioners who were on lower levels of income were in a situation where they also gained the increases from Harmer for their income support payments.

I am very happy to provide details to the opposition with respect to what that impact has meant for individuals according to their financial circumstances. The government’s commitment through Harmer, and the government’s commitment through what it supported at the last election in relation to disability compensation payments, has been maintained and has been honoured. In the process, some people have misinterpreted it, and some have attempted to make out that our commitments were something different from what they were at the time. That is unfortunate but it does not get away from the key point, which is that the government did what the government said it would do, and the government maintained the value of those disability compensation payments according to male total average weekly earnings, which was always what the argument was about.

The final point I will make is this. The shadow minister wanted some figures around the question of the actual cost with respect to what it would take to re-establish that percentage nexus, as outlined in her speech, with respect to increasing disability pensions to take those points into account. I do not have those details with me but I could give you a couple of basic points. What you can say is, in very rough terms: 29,000 TPI pensioners or thereabouts and that is in excess of some—I will get a figure on total disability pensioners yelled to me in a second. But the point in relation to that is that the figures that have been on the net around this have suggested that it would involve an increase of in excess of $110 per fortnight with respect to the TPI payment. So, as a starting point: take $110 per fortnight; multiply that by the number of fortnights; multiply that by the number of TPI pensioners—that will be one of your core components. Then, when you go to the question of the general rate disability pensioners, it will be according to what rate they have got and a similar adjustment according to the value of that payment on a percentage basis, which I think has been named as being in excess of 10 per cent. (Extension of time granted) On the issue of other disability pensioners beyond the special rate, figures from around March 2010 indicate that there are some 93,000 pensioners beyond the special rate, bringing it up to a total of about 123,722 as of March. That is the basic core of it. But I am happy to provide additional information to the shadow minister, outlining the detail of what that means in terms of the payments.

Proposed expenditure agreed to.

Attorney-General’s Portfolio

Proposed expenditure, $3,992,303,000