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Thursday, 14 June 2007
Page: 57

Senator MARK BISHOP (1:15 PM) —The Veterans’ Affairs Legislation Amendment (2007 Measures No. 1) Bill 2007 is a relatively simple housekeeping bill that does not require a lot of description or debate. It makes amendments to a number of acts involving veterans benefits. Its aim is to correct anomalies contained in those acts. This is necessary to avoid unforseen matters cropping up. It only takes a few people to be affected unfairly for such amendments to become necessary. As such this bill is unobjectionable and is worthy of support.

It is worth reflecting, however, on this maze of legislation and the seeming inability to streamline it. This is particularly the case with veterans benefits. Such benefits originated far earlier than most of those in all other social security legislation. Veterans benefits were derived from the ravages on diggers, and their dependents, of World War I. They have always been distinct from social welfare payments. Inevitably, however, similarities between the two have been drawn. The separate origins of these benefits were forgotten by many. Indeed, some have wrongly suggested that the payment and the care of veterans should be transferred to what is now known as Centrelink. That will never happen, and nor should it. We have long preserved the veterans jurisdiction as a separate entity within government because of its unique status.

The history of veterans care and the public’s commitment to it is very important. The gradual move within and into the Defence portfolio, however, is a far more positive one. As care shifts from World War II veterans to the general population of ex-service personnel, that move becomes even more sensible. Even now the separateness of veterans affairs and Defence may not be as logical as it once was. The artificial division in the provision of services often leads to inefficiencies. The quality of services delivered by two agencies to separate populations—dependent only on eligibility for war service benefits—is hard to justify now. We recognise the special status of those who served to defend us in the past, but the nature of modern service is quite different, as are the needs for support. The dual operation of disability compensation schemes has become a nightmare, and it is often unfair. The new act will remedy that in time. But it is something that should have been done 15 or 20 years ago.

The situation is likewise with income support benefits. Differences between the service pension and the age pension are recognised, but over the years they have been brought into line. However, as this bill shows, there are still differences which trip up legislative drafters. It is difficult to keep in synch different legislation that affects the same population. In policy terms, there is only one substantial difference between the age pension and the service pension, and that is that eligibility for the latter commences five years earlier. But this is also historic and there must be doubt now about the relevance of that distinction—except for it being a mark of status between the two categories: the aged pensioner at large and the aged veteran.

The origin of that five-year eligibility demarcation reflects the shortened life span of many ex-World War I diggers, who spent many years overseas suffering interminable bombardment. It was likewise for many in World War II, although it is not necessary to get into a debate as to who suffered more. The point is that the issue of longevity, as affected by war service today, is increasingly becoming a dubious proposition. If, in policy terms, it is a mark of respect or of service, then let us say so. But, if it is a reaction to reduced life expectation, as a general proposition it is now doubtful. The fit soldier syndrome is equally as relevant.

So the question becomes: why doesn’t the government get serious and avoid this legislative process every year? Why doesn’t it provide one age service pension through the act? Preserve the age differential by all means; but apart from that the differences are minimal. If we can do it for disability compensation between two very large agencies, why not between two others? The answer is that the social welfare bureaucracy would never agree. That is because of the longstanding ‘warfare’ between agencies. The traditional values and cultures clash regardless of the greater good. That is why we now have such a strong focus on whole-of-government endeavours.

Government is quite rightly trying to bring some of these things together. There are two telling illustrations of this serious dysfunction in policy between the bureaucratic behemoths. The first is the Defence Force Income Support Allowance, which was legislated two years ago now. The policy conflict there was that the veterans lobby wanted to exempt veterans disability pensions from the means test for the age pension and other Centrelink payments for which it was counted as income. The government agreed to that proposal. It could have been done by adding a single word to the Social Security Act. But the social security mindset could not accept veterans compensation payments being treated in this manner. Nor would they administer the exemption through their payment system. So the Department of Veterans’ Affairs had to build its own new system to pay a refund of the equivalent amount, which social security had refused to deduct. This is mind-bogglingly stupid, but it is all on the pubic record and it all happened.

Again in the recent budget, a decision was made to pay a catch-up amount to T&PI veterans. Essentially, the government had agreed to the proposition that the value of the pension in isolation had declined over the years. Yet, having agreed to that, they chose to do nothing about the cause, which was a failure to index the whole pension—not just part of it—in line with other pensions. I bet this involved a social security objection to the indexation of a disability pension by a wage based index—that is, they stuck rigidly to a definitional difference in pension types between those which are economic and those which are non-economic. If I am not even close, perhaps the minister will advise me in his response. In policy terms, it makes little difference. As the government have clearly demonstrated, there is little policy consistency in this bill. Unfortunately, the government do not appear to care. So, instead of a better policy rationale between portfolios and legislation, we will have this legislative bandaid approach.

The same inane legislative fixes are produced budget after budget in the same area. These same amendment bills will keep coming before us, wasting the precious time of the parliament. Having said that, I will finish here and waste no more time. We support the bill but not the ridiculous process it represents. I ask the minister to respond to the issues that I have raised.