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Thursday, 30 June 1994
Page: 2402


Senator HARRADINE (10.51 a.m.) —We are talking about a proposition to exempt farm families—the farm itself—from the family payments assets test. There are very strong arguments for that, as indicated by Senator Woodley, whose latter point was that there are now heaps of farmers who on paper are asset rich but income poor. But that is not the only point, nor is it the major point.

  We are talking about the basic family payment. Let us get it into our thick heads that that is not a social welfare matter. It has always been a tax transfer matter. That was acknowledged when the tax rebate was abolished, cashed up and paid into the hands of the mother or the carer, who in most cases was the mother. It was acknowledged by the then Minister for Social Security, Don Grimes. It was also acknowledged and fought for tooth and nail by the opposition. Let us get it clear: we are not talking about welfare, we are talking about a tax transfer. We are talking about tax recognition. In this particular case, taking two farm families, one with six children and the other with two, the one with six children is paying more tax in the process of raising those children than the one with two—or, particularly, one with no children. So we are talking about a tax transfer measure.

  Let us talk about the farms. When the farmer comes to the end of the year—it is 30 June today—what does he do? He writes off depreciation on his header. He can get a tax exemption and tax concessions for the implements he utilises for developing his industry, which produces food for the nation and so on. The wife, the mother, is doing a very important job raising the children, the future taxpayers; but does she get any recognition for that? No. There is a grudging family payment, grudgingly given on the false impression that it is a welfare payment. It is not a welfare payment.

  Here we have a proposition to exempt the actual farm from the assets test. Why should that not be so? Let the opposition and the government say why that should be taken into consideration. If this is a tax transfer measure, as it is a tax transfer measure, why is there an assets test? Why is there an income test? If there were not, we would not have the problem where we have, theoretically, asset rich farmers who are income poor. I say theoretically because it is only on paper. In the bush people might try to sell their farms but not get any bidders. So while on paper a farmer might be asset rich, he will not be asset rich in practice.

  I ask Senator Patterson, and Senator O'Chee representing the National Party of Australia, to think about what they are doing if they fall for the trap the government is setting on these issues. The trap the government is setting is to deny what its government spokesperson, Don Grimes, said at the time of the abolition of the tax rebate system: `We must always remember that family allowances are not a social welfare matter, they are a tax transfer matter which recognises that families with children pay more tax and do not have the same capability of paying tax as do families without children.'

  If the government is going along the line we are talking about, why does it not then say to the asset rich farmer, `No, you can't have a tax concession for that header. No, you can't write off that header, we won't recognise that'? The government does not do it for their tractors but it does do it for their kids. That is what the government is up to, and let us think about that. I hope Senator Patterson and Senator O'Chee ultimately realise that. I thought that is what their parties were interested in—taxation justice.