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Wednesday, 8 December 2004
Page: 80

Senator DENMAN (3:25 PM) —I also wish to take note of the answers given by Senator Patterson in question time today in relation to Centrelink compensation. I had great hopes that the minister would do what she said she would do when she took over this portfolio of family and community services in 2003, and fix the problem which is creating so much grief and heartache for families all over Australia. I have great difficulty in supporting a system which with one hand purports to give but which takes away with the other. Like the rebate culture, which applies with so many other programs of this government, the principal solution offered to Australian families is to overstate their income so that they do not end up with a debt at the end of the year.

It seems to me that this government develops its philosophies for Australian families, and particularly for those in need, based on the circumstances of those who are much better off. Whether it is the Medicare safety net, child-care benefits or many other benefits, this government adopts the same approach—completely without consideration of the circumstances of those who need the support most.

The minister seems happy to provide the bandaid advice of overestimating income to avoid an unwanted debt later. There are two fundamental flaws with this approach. First of all, it defeats the very purpose of the family payment for those in real need, which is to provide them with the financial support when they need it—to put food on the table, to clothe and to provide health care and recreation for their children. For those families who have a cash flow it is not such a problem, but for those who need every cent they receive to pay for their daily outlays, the solution suggested by the minister offers no comfort at all. Secondly, it has a disastrous flow-on effect on other costs and benefits. As I am sure the minister is aware, child-care costs are assessed based on the estimated income levels currently registered with Centrelink by the client. If a client overestimates their income to avoid a family debt later, she or he will receive a smaller reduction in their child-care bill. In other words, the client gets less in family tax benefit whilst at the same incurring a higher cost for child care.

I have a constituent in exactly this situation. She is able to estimate her own income fairly accurately as she is on a set wage, but her partner works as a casual and they find it difficult to estimate his income from week to week with any certainty. They do not want a debt at the end of the year, so they overestimate their income to Centrelink and, as a result, suffer increased child-care costs on a weekly basis. It is hard enough for them—a family where one partner is earning a fixed and guaranteed income—but it is even harder for those who have no consistency at all in their regular income. But all this government is prepared to offer as a solution is to resort, once again, to the same old rebate culture that pervades so many of its programs.

It is not only child-care payments which are affected. For many families the effect of overestimating their income to Centrelink to avoid an unwanted debt at the end of the year will be to lose other entitlements, such as low-income health care cards and the consequent benefits and concessions that flow from having such cards. As with the so-called Medicare safety net and the government's proposed expansion of child-care support, the mentality is all based on a rebate culture—a culture designed for families who can actually receive a rebate.

I want to address an issue that Senator Guy Barnett referred to, and that is the way the $600 was spent. I know from experience that many families did not spend that $600 wisely. They chose to spend it the way they wanted to—and that is their right. A number of families got into debt by gambling the $600 and so the children did not benefit. Some of them did spend the money wisely but, in my experience, a number did not. They incurred debts, and so created difficulties for their children— (Time expired)

Question agreed to.