Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard   

Previous Fragment    Next Fragment
Friday, 22 February 1985
Page: 89

Senator HAINES(3.22) —Senator Messner has proposed for debate today what he alleges is 'the growing alarm amongst all pensioners, particularly those in rural areas, at the unfair and uneven impact of the assets test legislation'. While not for one minute believing that the assets test legislation, any more than any other legislation which is passed by this Parliament, is anomaly free, I have to say that I find this statement by Senator Messner to be extraordinary. It is extraordinary for a number of reasons. The first reason is that any growing alarm among pensioners was very largely induced by the rather unconscionable behaviour of some members of the Opposition parties prior to and during the election campaign, when they did everything they could-presumably in the hope of gaining office as a consequence-to frighten the living daylights out of those people who were likely to be affected by the proposed assets test. They directed their attention predominantly towards elderly people, who are the most easily frightened.

Senator Teague —Do you have some examples of that?

Senator HAINES —Yes, I do have some examples. The sorts of things that were thrown at those people in radio programs, Press releases and so on were allegations, amongst others, that the gold in their teeth was likely to be taken into account for assets test purposes, and the 'knock, knock' situation that the Leader of the Opposition, Mr Peacock, managed to get himself into every time he was on a platform. He regularly made a comment implying that there would be some sort of Hitlerian behaviour by Department of Social Security officers, who would ransack pensioners' homes looking for goodness only knows what under beds, in drawers and in cupboards. It is hardly any wonder, therefore, that certainly prior to Christmas there was growing alarm among pensioners about what the assets test was likely to bring. From the diminution in the number of letters that have come into my office since then, however, I would say that that alarm is declining.

The second extraordinary statement Senator Messner made in this debate was his reference to the assets test being unfair and having an uneven impact on people. I cannot imagine a more unfair, inequitable and unevenly impacting system than the previous system under which pensioners and beneficiaries existed. I refer to a system in which only income was tested, and that system was introduced by the previous Liberal Government. I presume that Senator Messner and his colleagues, in bringing forward this criticism of an assets test, would like to see a return to the days in which income only is tested so that those people with the nous, with the access to smart lawyers, cunning accountants and so on, could arrange their affairs in such a way that their income was minimised. Such people could go on the pension and at the same time have enough capital to live on in relative luxury.

A classic example is that pertaining to two workers, one of whom was entitled to take out lump sum superannuation and the other of whom was not. It was always possible for a person who could take a lump sum to hand it over to relatives to look after so that it apparently was not in that person's care, or to put it in a non-interest bearing account and still be able to draw on the capital. Those sorts of benefits did not accrue to someone who was not able to take a lump sum but had to take, as do so many people on small superannuation payments, a regular fortnightly or monthly cheque. Such people were means tested because they had income coming in regularly. That sort of anomaly is much greater than any of the anomalies which exist under the present system. It is not fair. It has an uneven impact. It is highly inequitable and most anomalous. I cannot believe that some of the simple minds of honourable senators who sit on the Liberal Party and National Party benches in this place could believe that it is fair, even, equitable or anomaly free. The facts are that a means test which includes certain assets-it does not include all assets because the principal place of residence, the family home, is specifically excluded-as well as including income is far more equitable and far more even in its impact than one which is based on income alone.

I said a few moments ago that I did not believe that this current system was perfect or that it was totally anomaly free; no legislation ever really is. But most of the problems that have been raised, including those affecting people in rural areas, seem to stem not from the principles of the Act, nor even necessarily from sections in the Act, but from discretionary guidelines emanating from sections of the Act, and there is a difference. Those discretionary guidelines are being determined by the Department of Social Security.

Senator Messner mentioned a matter which I raised during Question Time today relating to residents of aged persons homes. In this case the Department, rather than the Act, has decided: At law

whose law I am not quite sure and which law I am not quite sure--

. . . all persons who pay, lend or donate money to secure accommodation in an aged persons' home, by virtue of that payment, obtain a right to accommodation and accordingly become homeowners in the same way as any other person with a life interest in a home.

That definition was included in a letter from the Department of Social Security to a constituent and, I think, was signed by the Acting Assistant Secretary, Benefits, Administration and Entitlements. That definition is not enshrined in the Act. It is up to the Department's discretion to make decisions. I feel this is a foolish one. The Minister for Community Services (Senator Grimes), in answering my question, acknowledged that it was an anomaly. It makes no differentiation between people who pay $35,000 or $40,000 on loan to get accommodation in an aged home, and have that money then returned at a later date, and the people who pay a small $8,000 to $10,000 donation and lose it entirely. It pays no attention to the fact that these people have no title to any property. They pay rent and many are, in effect, in a similar situation to those who pay bond money to landlords. I hope that the Minister will do what he indicated in Question Time and pursue this matter in line with the Prime Minister's assurance that the Government will keep an eye on any anomalies that arise. This anomaly has already arisen and ought to be attended to, preferably before 1 March.

Problems affecting people in rural communities seem also to stem, although perhaps not entirely, from the manner in which the Department of Social Security officers are valuing land under the hardship provisions. If my correspondence is any guide, the largely unsympathetic method that is used by the Department affects farmers quite severely when they are hit by a bad year and suffer low yields. It also affects people who live on properties in areas where State or local government regulations prevent sale of part of the property. There seems to be a fairly inflexible system applied by the Department, again, one which is not laid down in the Act but which is emanating from the discretionary provisions in some sections. So the anomalies and inequities which Senator Messner implies are in the Act have a tendency not to be an integral part of the system but to be administrative problems and, therefore, one would hope, solvable by administrative means.

Senator Messner —Wrong.

Senator HAINES —It may well be that I am wrong. At the moment the problems raised with me seem to stem from administrative decisions made by the Department and are therefore solvable at that point. Senator Messner is the Opposition spokesperson on community services. Since I presume the Liberal Party chooses its spokespeople for their acumen, intelligence and knowledge of the subject, surely he could have come to the Senate today with a matter of public importance focusing on the real plight of a large number of people-mainly women and children in the social welfare sector, people caught by anomalies, inequities and unequal distributions of money, people who are caught in poverty traps under this Government as they were under the previous Liberal Government. Their plight is an ongoing matter of public importance, or it ought to be, and not something that is manufactured by the scaremongering tactics of certain politicians for some ephemeral political gain.

I would have thought that it would have been more useful if today the Senate had discussed the fact that the Hawke Labor Government has an abysmal record in its actions towards the welfare sector. In its first two years in office the Hawke Labor Government has paid less attention to the welfare sector than have most previous Liberal Governments-and I say that with all due respect to the current Minister and indeed to the immediately preceding Liberal Minister. Both those senators did what they could, I believe, to mitigate an increasingly awful welfare problem. Unfortunately, they ran into the brick walls of their respective Prime Ministers and certain Cabinet members. As a consequence, we still have three-quarters of a million children living below the poverty line; we still have an increasing number of homeless young people. We still have a situation where legislation aimed at helping low income families-for example first home owners-does not help sole supporting parents and their families because they do not reach the minimum income level. The unemployed and others on pensions still have no incentive to earn extra money or to seek limited part time work to help them survive because of the income levels placed on them before their pensions are affected. Job creation schemes are still short term solutions to a growing problem of youth unemployment and the mature aged unemployed are barely catered for. I submit that all these are greater and more serious examples of an unfair and inequitable social welfare system than anything contained in the assets test legislation.

Finally, I refer to one or two comments made by Senator Messner with regard to capital gains taxes, death duties and lump sum superannuation. I remind him, if he needs reminding, and the Senate that in fact that capital gains tax on lump sum superannuation that he criticised at the beginning of his speech passed this place in the form in which it passed this place because every Liberal and National Party senator voted with the Government on it.

Senator Teague —We opposed the legislation.

Senator HAINES —They opposed a Democrats amendment which would have exempted large numbers of lump sum superannuation recipients on the grounds that it was trivial.

Senator Messner —Would you have voted against the legislation?

Senator HAINES —Yes, we would have, had we had the opportunity. In the same way it was Liberal and National Party senators who voted in favour of a sales tax on wine. They supported every increase in primary industry levies, with the possibly exception of Senator Boswell, who chose to abstain on one levy Bill vote. If they proceed in that manner in the next three years it will be useless their complaining about the Government introducing death duties which, I point out to Senator Messner so that he can take it back to his shadow Cabinet, we are opposing. Just so that Senator Messner gets it right, we are opposed to death duties. If they maintain in this place the voting habits they have had in the last two years, they will vote with the Labor Government to pass them. So they should not complain about anything that the Labor Party has done as far as tax legislation is concerned when they were at least silent partners. No, that is not true; they were mostly noisy partners but when it came to the crunch they supported it. Senator Messner said something about anomalies being removed from the assets test legislation. I hope that he will talk his colleagues into supporting our anomalies Bill, which is aimed at helping people who are unfairly, unintentionally and inequitably hit by some administrative decisions emanating from discretionary clauses.