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Friday, 1 June 1984
Page: 2358

Senator HAINES(11.50) —Having listened to Senator Messner for the last 25 minutes I can only assume that the Opposition is relying on Senator Chaney to come forward with some intelligent contribution to the debate and some sort of rational, relevant, competent analysis of not only the Gruen report of the Panel of Review of Proposed Income and Assets Test but also of the Government's proposal. Senator Messner concentrated on calling the proposal outrageous and he described the comments as unctuous and oily. He concentrated, too, on pointing out what was likely to happen to the Australian Labor Party, the present Government, after the next election, which probably says a great deal about Senator Messner's and probably the Opposition's priorities since they are far more concerned in stirring up problems in the community in order that they can get re-elected than in making sure that money goes to the needy.

I can say to Senator Messner, Senator Walters and anybody else in here who wants to carry on that they might just as well go out into the community and attack us as well, as I am sure they intend to anyway, because we are intending to support this move which is at least an attempt to get over the anomalies of the current system, just as we would have supported Senator Chaney's attempt a year or two ago when he was proposing ways of getting around the anomalies in the current system. Senator Chaney, at least, of all the Liberals, had some courage, as a Sydney Morning Herald editorial pointed out, in at least focusing on the fact that there were problems in the current system. I think we made it perfectly clear at the time that had he come up with some sort of system that confronted those problems, that insisted that the wealthy-the Liberal's natural constituency-did not get hold of money that should be going to the needy, we would have assisted him.

We made it quite clear that we saw a lot of problems-we still see a lot of problems-in the present system rather than one which is incomes-only based under which people who receive very large lump sum superannuation payments can make excursions into double-dipping and know that people in the Liberal Party will sit back and let them continue in that way. That, of course, is what the Liberals are more concerned about, not in making sure that those people are stopped so that the money can be spent on people who are in need, who have never had any opportunity to acquire vast assets, liquid or non-liquid.

Through the whole of Senator Messner's speech, through the whole 25-minute tirade, we heard no suggestions at all about what--

Senator Button —Senator Messner is full of liquid assets.

Senator HAINES —No, the bar is closed, Senator Button. We heard no comments, proposals or suggestions at all about what the Liberal Party was going to do if it gets re-elected at some time in the future.

Senator Messner —We are not trying to help them do their job.

Senator HAINES —Well, Senator Messner says they are not going to do the Government's job for it. I would have suggested that one of the responsible roles of an opposition party in this place is to make sure that every amount of talent, although there is a limited amount of that in the Liberal Party, that can be brought to bear to improve legislation is, indeed, brought to bear. Members of the Opposition should not sit back unctuously and sanctimoniously and say: 'We will allow this sort of thing to go on until we get into power, if we ever get into power, and then repeal it'.

Senator Messner —What is your policy?

Senator HAINES —I am coming to that.

Senator Messner —Do you have a policy?

Senator HAINES —Calm down, calm down.

Senator Button —What did they say about shadow Minister Hodgman-'crawl up a sewer to get a vote'?

Senator Walters —I ask that that interjection be withdrawn.

Senator Button —I was not casting any personal aspersions on anybody in the Opposition. I said that the Sydney Morning Herald said that Mr Hodgman would crawl up a sewer to get a vote. That is merely reporting what was in the Sydney Morning Herald. I think that would be allowable in this Parliament.

Senator Chaney —I take a point of order. Senator Button is a lawyer-I do not know of what level of ability-and I am sure he knows that it is no defence to plead that somebody else said it when one uses unparliamentary or defamatory terms. That is a legalistic but invalid defence. I suggest that the point of order should be upheld and that he should be asked to withdraw.

The ACTING DEPUTY PRESIDENT (Senator Sibraa) —Senator Button, the words are unparliamentary even if they are quoted from a newspaper. I suggest, therefore, that you withdraw.

Senator Button —I withdraw. Mr Hodgman would not crawl up a sewer to get a vote.

Senator Chaney —That, again, is the oldest story in the book. I again take a point of order. The withdrawal should be unconditional and not be a repetition of the insult in a slightly different form.

Senator Button —I withdraw.

Senator HAINES —Senator Messner asked what the Australian Democrats would do. In an ideal situation I would suggest that we would do what Senator Messner would do and what the Government would do, and that is make available the pension to everybody at a certain age regardless of need, make it taxable and so on. In an ideal world that is what we would do. Unfortunately, we are stuck with something that is not an ideal world, largely, I suspect, due to the fact that, in the seven years of the previous Government's existence, although Senator Chaney bothered to come to terms with it, the issue apparently got stuck somewhere, probably in the Party room. The Liberals seem to have this wonderful idea that those people who have it should keep it and those people who do not have it do not deserve it in the first place.

Senator Dame Margaret Guilfoyle —It was Senator Chipp who wrote the policy.

Senator HAINES —It may well have been applicable back then. However, let us at least return to the Government's proposal and see what it does, and this is something to which Senator Messner did not pay a great deal of attention. The Government's current proposal is not only a distinct improvement on the present system since it obviates a number of the anomalies that exist under the present incomes-test only scheme, but also it is a vast improvement on the policy that it brought forward last year, the one which we, with the support of the Opposition, criticised trenchantly because of the loopholes it contained, because of the exemptions it included and, hence, because of the anomalies that were bound to occur. This side of the Senate succeeded in having that proposal delayed until the Prime Minister (Mr Hawke), with his nose on a good thing as usual, decided in February to send it off to the Gruen committee. The upshot of that was the proposals that were included by Professor Gruen and his committee in the report that was issued to the Prime Minister last week. The committee issued a report which contained three options. The committee objected entirely to the first option, which was the Government's previous proposal. The second was what they called the 'tall poppies' test and third was the modified test.

We acknowledge that the Government has chosen the soft option in going for the exclusion of the house. But in doing that it has at least made some attempt to grapple with a problem that would have existed had the earlier proposal come to fruition, and that is the problem of people who do not own a home, who do not have an appreciating capital asset, and those people who have to sell their home and go into a nursing home. The Government, through the Gruen report, has at least made some attempt to look at that and it is to be commended in that respect.

Senator Messner alleged that Professor Gruen is not happy with indexation, particularly indexation based on the consumer price index. I do not know how recently Senator Messner has spoken to Professor Gruen but I talked to him about this last Monday night because to us indexation is the major problem with any form of assets testing. Professor Gruen agreed on Monday night that in a political context the suggestion of a regular review, however appealing it might be to an economist, did not really mean very much, knowing politicians to be what they are. He therefore was quite happy to support either the use of the CPI as an indexation factor or the building index if the house was included in the threshold limits. The house has not been included. The CPI is being used to index pensions. It might just as well be used, for want of any other more relevant one, as an indexation factor for the threshold now that it will not include the house.

The Democrats would have preferred to see both the threshold and the pensions indexed twice-yearly. The pension will continue to be indexed twice-yearly. It is unfortunate that the Government has not seen fit to index the threshold also twice-yearly. The major problem left for the Democrats is fringe benefits. This problem has been with us for a number of years. I do not believe the Government has bitten the political bullet, so to speak, in any way at all in confronting this issue. So far it has hidden behind the fact that the States have to be consulted. Quite frankly, I think it is about time that the States formed their own criteria on which they would provide rate, electricity and other benefits to people who currently hold a pensioner health benefits card.

In the past many people have distorted their incomes considerably, often to their own financial detriment, because they have believed access to the pensioner health benefit card to be something of tremendous value to them, if not at that time then at least some time in the future. So many people on a pension or part pension saw the health benefit card as a sort of security blanket. As a consequence of re-arranging their incomes and assets, they were depriving the Government of a significant amount of money. Had the Government done what Professor Gruen intimated could well be done and extended the accessibility of fringe benefits to all people on pensions or part pensions, there would certainly have been an end to that practice. I suggest that the Federal Government, if not the State governments, would have picked up, very likely, as much on the swings as it lost on the roundabout and eased the emotional stress for a large number of people.

Of course there are those who would argue that fringe benefits should be made available to people of a certain age or on certain incomes. However, the Government could have looked at least at extending the benefits to those who are on pensions of some sort or another.

There have been complaints about the fact that the introduction of an assets test is likely to cause vast invasions of people's privacy, infringements of their civil liberties, and so on. I believe that the Government has made a pretty good effort to overcome this problem by inserting into the proposal a $10 ,000 limit; so that unless someone believes that his assets are worth more than $10,000, nobody will come wandering into his home counting sheets and pillowcases and checking whether there is a spare Van Gogh in the basement. This is certainly an improvement on the old size 10 thong and bed sniffing brigade that used to operate under the previous Government when it came to checking out peoples' eligibility for pensions of one sort and another.

The reasons therefore that we are prepared to accept the Government's proposal is that it is an improvement on the existing system and a vast improvement on its proposal last year-it is not an ideal answer to the problems because we are not living in an ideal world-and that the proposal does eliminate the double- dipping and income distortion problem that has existed. The proposal does have simplicity on its side and avoids complexities. Administratively, it should be easy to operate. It is certainly easy for those in the community to understand. It was one of the options, if not the absolute preferred option, of Professor Gruen and his Panel. I think we have to respect a group of people who are widely talented and from as wide a range of organisations in the community as those who served on that Panel.

The proposal confronts the problem that most concerned the Democrats, and that is the problem of indexation. Also, it will avoid any unnecessary invasion of people's privacy. It copes, or attempts to cope, with the problem of people who do not own their own home, who are renting or living with others, or who are, or one day will be, in a nursing home. The fact that the proposal does not front up to the problem of fringe benefits is something I would like looked at later in the Government's long term planning. It is certainly not of sufficient concern to make the Democrats oppose the legislation, particularly given the fact that in his 25-minute tirade Senator Messner, who, presumably, will be Minister for Social Security should the Liberals ever get back into power, did not offer one alternative suggestion. All he did was complain about this proposal and, by implication, say that the current income only system is working well, that it has no problems, that no one is being damaged, that money goes to those who need it, and that the system does not need changing in any way at all. Had he not believed that, it would have been incumbent on him to make those points. I can only assume that if the Liberal Party of Australia does have some alternative proposals, Senator Chaney, whom the Sydney Morning Herald labelled 'intelligent Senator Chaney', will no doubt put them forward in a moment.