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Wednesday, 12 May 2010
Page: 3405


Mr BALDWIN (4:00 PM) —I rise today to speak on the Veterans’ Entitlements Amendment (Income Support Measures) Bill 2010. This bill is yet another in a series of bills that affect veterans and future veterans alike. This government seems to believe that tinkering on the edges of policy development and introducing administration bill after administration bill on veterans affairs issues are wholesale substitutes for policy reform. It is disappointing that I again stand here and debate yet another bill that fails to deal with the No. 1 issue that affects our veteran community, an issue that the Rudd Labor Party said prior to the 2007 election it would fix. I refer, of course, to the Rudd Labor government’s promise to fix the indexation of military superannuation pensions.

The Minister for Veterans’ Affairs, the Hon. Alan Griffin, is now also the Minister for Defence Personnel. There can no longer be any buck-passing between ministerial portfolios in veterans affairs or defence as to who has responsibility for defence superannuation. The matter now rests entirely in the hands of Minister Griffin. It was Minister Griffin who, prior to the last election, demanded that action be taken on military superannuation. It was Minister Griffin who said he would fix the problem. I will come to more on that later.

This bill sets out to amend certain sections of the Veterans’ Entitlements Act so that its provisions are more closely aligned to provisions found in the Social Security Act. Overall the changes are non-controversial and in general, on the advice provided by the government, will not leave any veterans worse off.

The first amendment in this bill will remove all references to benevolent homes. Benevolent homes are institutions where persons may stay for extended periods of time, such as places for the mentally ill. Traditionally a person would receive a reduced pension if they were living at a benevolent home, with the deducted portion of their pension being paid directly to the benevolent home. The Social Security Legislation Amendment (Carer Pension and Other Measures) Act 1995 effectively removed the vast majority of provisions that referred to benevolent homes; however, similar changes were not made to the Veterans’ Entitlements Act because at the time there were still pensioners receiving a reduced pension on the grounds that they were residents of benevolent homes. As benevolent homes no longer exist and as there are no longer any veterans who are affected by these provisions, this bill will simply repeal from the Veterans’ Entitlements Act all references to benevolent homes.

This bill also seeks to simplify arrangements pertaining to veterans participating in labour market programs that are administered by the Department of Education, Employment and Workplace Relations that are designed to assist those looking to enter or re-enter the workforce. Assistance can include training for unemployed people, support services and formal vocational training, all of which are delivered by the national employment services system, Job Services Australia.

Currently veterans do not need to include any payments they receive under a labour market program in the income test if those payments cover expenses such as uniforms. However, payments they may receive for part-time work experience under a labour market program are subject to the income test. This acts as a disincentive for veterans to undertake part-time training, as the small amounts of money they would potentially receive may negatively affect their pension payments. The amendments contained within this bill will align the treatment of payments for expenses and part-time training with those contained in the Social Security Act. Simply put, this means that veterans receiving payments for undertaking part-time training as a part of a labour market program will no longer have to worry about those payments potentially affecting their pension payments.

The next amendment contained within this bill will require a veteran’s partner to claim any foreign pension to which they are entitled. This provision is based on the underlying rationale that a person who has the means to support themselves financially should utilise his or her own means or resources before receiving financial support from the public purse. This amendment will again align provisions found in the Veterans’ Entitlements Act with the Social Security Act, and will compel the partner of a veteran in receipt of a service pension or income support supplement to claim and receive any foreign pension they are entitled to receive. Although the majority of those veterans affected by this change will be better off, I echo the sentiments of my colleague the member for Greenway in stating that the coalition would like to hear from any veterans or their families who find themselves worse off under these changes.

Following on from the previous amendment regarding entitlements to foreign pensions, this bill will also amend the manner in which a lump sum foreign pension payment is treated in regard to an income test. It is important to note that foreign pensions are sometimes paid as a lump sum, particularly at the commencement of receipt of that pension, due to the time taken for the overseas agency to determine the entitlement and then process the claim. Often these lump sum payments pay an amount in arrears over a number of months or indeed years. By way of example, under current legislation, if a veteran were to receive a lump sum pension payment from a foreign source, that payment would be treated as income over one financial year even though that lump sum may have included payments in arrears for a period of two or three years or even longer. The situation would most often result in a reduction to the veteran’s pension, as a lump sum is considered a part of that person’s income under the income test. This amendment will simply ensure that any foreign pension lump sum payment is treated as income over the years for which it has been accrued and paid rather than treating it as income received during one financial year only. Whilst this amendment will likely benefit most veterans, some may incur a debt as a result of this legislative change, particularly those who receive large lump sums for a period covering more than 12 months. I would urge the government to ensure that the veterans who find themselves in this situation are given ample time to pay off this debt, as it would be totally unacceptable that any veteran should be left with a debt through no fault of their own and forced to repay it at an unreasonable rate just because of the government’s short-sightedness or lack of attention to detail.

Finally, this bill seeks to amend the provisions in the Veterans’ Entitlements Act for the disregarding of an asset. This provision will empower the Minister for Veterans’ Affairs to make a determination with regard to the exclusion of an asset from the asset test where that asset has lost its value or that asset cannot be assessed. For example, if the asset is sold without an adequate return or value, the Minister for Veterans’ Affairs may disregard the asset under the assets test. Furthermore, if the asset is unable to be assessed by the person, which may occur in the event of frozen superannuation assets or bankruptcy of that asset, the Minister for Veterans’ Affairs may also disregard the asset under the assets test. This amendment to the Veterans’ Entitlements Act will align it with similar provisions under the Social Security Act.

On the information provided by the government to the opposition that no veteran will be worse off under this bill, the coalition support the measures contained in the bill. We believe they will help ease the administrative burden placed on veterans through aligning the aforementioned amendments with those provisions contained in the Social Security Act. However, yet again we see that the Minister for Veterans’ Affairs is simply tinkering around the edges with policy. Much as with the budget that was handed down last night, Minister Griffin continues to demonstrate that he is unwilling or unable to take the tough decisions. It is more talk and no action. The minister happily announced during his second reading speech on this bill that it:

This bill continues the government’s ongoing commitment to supporting Australia’s veteran community and their families and ensuring their wellbeing now and into the future.

That is the talk. As for the action, it has now been over two years since the release of the Podger review into military superannuation reform and not one word has been uttered by the Rudd Labor government. The Rudd Labor government also failed to respond to parts of the Clarke review, failed to review advocacy funding and delayed the introduction of the Governance of Australian Government Superannuation Schemes Bill 2010, a bill that many veterans are sweating on the outcome of.

Although I support this bill, it does nothing to address the core concerns of the veteran community. As the Defence Force Welfare Association pointed out in its response to last night’s federal budget, there is:

Nothing for long suffering military superannuants whose standard of living continues to deteriorate due to unfair indexation and taxation of MSBS and DFRDB superannuation pensions and the gouging of DFRDB superannuation benefits that service men and women paid for during their working lives.

In addition to that, in a situation where this government has announced that we will have a peak debt of $93.7 billion, at a time when it is spending an additional $1 billion just to bail out the Home Insulation Program, how much would the government have been able to do for our veteran community if it had managed our economy economically responsibly? How much would that $1 billion that is being spent to fix up a failed insulation program have been able to do for our veteran community?

The minister will argue that in the current economic circumstances there is nothing that they can do for the military superannuants under the MSBS or the DFRDB. I put to the government: your delay in responding to the report, which was tabled on 24 December 2007, your blatant disregard for the financial situation of those former members and current members of the military in relation to their superannuation payments and the fact that you are prepared to spend the taxes that they have paid in other means without due regard to their needs says that you have been negligent in the performance of your duty. I do not mean ‘you’ as the Deputy Speaker, of course, Mr Deputy Speaker; I mean the government, the Minister for Defence Personnel and the Minister for Veterans’ Affairs. Veterans deserve a government that is upfront and honest with regard to its policies and promises—something the current government has failed to be on both counts.

Further, the Defence Force Welfare Association pointed out in its response last night, in addition to what I said before, that there has been:

No decision on the reclassification of the service of certain counter terrorism special operations undertaken by SAS personnel.

No decision to remove the remaining level of erosion to the value of the Veterans’ Disability Pensions nor to adjust them in line with the increase in community living standards since 1997.

Again, that has been held back because of the amount of debt created by the government, by the sheer fact that they are going to be paying $6.5 billion in interest payments to fund that debt. Again, I put to you, Mr Deputy Speaker, a statement that I put to the government: if the government had run their economy as the economic conservatives they said they would be, there would have been money freed up that could have been spent on our veteran community.

The wholesale changes that the veteran community were expecting after the promises made by Labor at the last election have simply failed to materialise. This government is unable to make the tough decisions and unable to undertake serious reform. That point was made clear not only in this bill but also in last night’s big-taxing, big-spending Labor budget. This year’s budget deficit of $40.8 billion, the second biggest since World War II, when combined with the continued reckless spending by the Rudd Labor government, will result in only piecemeal policies for veterans and result in legislative changes such as those contained in this bill that only tinker at the very edges of the policy reform that is really needed. As I said, veterans deserve a government that is upfront and honest with regard to its policies and promises—something that this government has failed to be on both counts. At the very least, veterans deserve a government that respects them for their past service rather than paying lip-service.