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Thursday, 9 May 1985
Page: 1648

Senator HAINES —My question is directed to the Minister representing the Minister for Social Security. I refer the Minister to a recent successful appeal by Madame Artwinska with regard to the classification of her German reparation pension as income under the assets test. Can the Minister say how many people in Australia are in receipt of a German pension under the West German Federal Restitution Act? I remind the Senate that such pensions are paid only to survivors of concentration camps. What is the estimated cost of not including these reparation pensions in the income test for the Australian pension? Further, can the Minister say whether the Government intends to appeal to the Federal Court of Australia against the decision of the Administrative Appeals Tribunal in the Artwinska case? If it does intend to do so, when is it likely to lodge the appeal and on what grounds will it lodge it?

Senator GRIMES —I am well aware of the Artwinska case and was well aware of similar cases when I was Minister for Social Security. The number of people in Australia who are in receipt of Federal Republic of Germany pensions under the Restitution Act is not known precisely. It is my understanding that the number is less than 2,000; therefore it is pretty small. Senator Haines asked the cost of not including these pensions in the income test applying to the Australian pension. The cost, for reasons of uncertainty, obviously cannot be estimated but it is also likely to be very small. The implication of excluding these pensions has been considered in the past by previous governments in the context of a possible flow-on effect embracing compensation-type payments to people who have suffered through war in all sorts of situations, be it persecution or other aspects of war, and the costs of that would be very considerable indeed. The Secretary to the Department of Social Security has instructed the Australian Government solicitor to lodge an appeal. An appeal has been lodged but that does not mean that Mrs Artwinska will not be paid the pension; in fact it is my understanding that she will continue to be paid.

I will state roughly the grounds for the appeal. The Administrative Appeals Tribunal held that German restitution payments are not income for pension purposes under the Social Security Act because neither of the two definitions of income under that Act applies to the payments; that is, they are not moneys, as described in the Act, earned, derived or received, and nor are they a periodical payment by way of an allowance. The Administrative Appeals Tribunal then said that even if such payments are income within those concepts, they are accepted pursuant to the exception for compensation made for reasons of the loss of, or damage to, a building, plant or personal effects.

The grounds of appeal to the Federal Court challenge all those holdings. They suggest that the Administrative Appeals Tribunal's interpretation of the word 'money' was too restrictive, that the pension-like character of the money received indicates that it is income and, finally, that the characterisation of the money as compensation for loss of property, et cetera, is questioned, given the very substantial element of compensation for persecution and personal suffering represented in these payments.

One thing that will result out of these appeals is that the matter will be settled, one way or another. However, the basic reason why previous Ministers, including myself, have accepted the departmental advice in this area is the very considerable flow-on effects which would result.