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Thursday, 8 July 1920


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) . - I was to have spoken at a previous sitting on this question, but it will be remembered that the honorable member for Hume (Mr. Parker Moloney) took up the whole of the available time. I propose to give the House a few figures which may be interesting, if not to-day, on some other occasIon,. This is a matter which, as is well known, falls within my purview just now as a matter of administration. I have had several deputations and representations made to me lately with regard to increasing the old-age and invalid pensions, and it would be the easiest and most pleasant thing to me to be able to say at once, ' ' Yes, the pensioners shall have £1 a week " ; but it is quite another matter -when we come to consider ways and means- of providing even for so worthy an object. Only six months ago we decided to increase these pensions by 2s. 6d. a week, making a 50 per cent, increase altogether since the Act was originally passed. It was estimated that this additional 2s. 6d. a week for the number of pensioners then on the roll would mean an additional expenditure of £800,000 a year. For the six months since that decision was arrived at, and the Act was amended, that increase alone has cost us, as I said todav, nearly £700,000, and it is quite certain that before the year is over it will have cost us £1,500,000. From some figures I have here I find that for the financial year ending 30th June, 1915- when the maximum rate of pension was 10s. a week, the amount paid was £2,704,309.


Mr TuDOR - That is for both invalid and oM-age pensions?


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - For both; and the amount paid must have been a great deal less in the year the Act was originally passed. In- 1916 the payments amounted to £2,859,766. In that year- and this is the point I wish to make - the limit of income and pension was raised to £58 10s. per annum, and the maximum pension to 12s. 6d. per week. Although the increased rate was in operation for only nine months of the period, the payments for the year ending June, 1917, rose to £3,518,987. The full effect of the increase was shown in the year ending June, 1918, the payments for that year being £3,753,977 - an increase of £894 211 over the expenditure of two years before, when the maximum pension was 10s. For the year ending June, 1919, the amount paid in pensions was £3,880,865. On the 1st January, 1920, the limit of income and pension was raised to £65 per annum, and the maximum pension to 15s. per week. Although the increased rate was paid for only about half the period, the payments for the year ending 30th June, 1920, were £4,574,000; and it is estimated that at least £5,300,000 will be required for the year ending; June, 1921, assuming that no further increase is made in the meantime. Tt will be pe?n therefore, that the payments for 1920-21 will be almost double those for 1914-15.


Mr Riley - On account of the increased number of applicants.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - That is what I was about to point out. It is now suggested by the honorable member for EdenMonaro (Mr. Austin Chapman), and other honorable members, and was also suggested to me the other day by a deputation, that the pensions should be increased by another 5s. Every one knows the great interest that the honorable member for Eden-Monaro has taken in these old people; indeed, in some respects he may be said to be the father of the old-age pensions scheme, and he naturally feels strongly regarding it. I am very sorry to have to damp his ardour, and sorry that I cannot do everything that he would like to have done, even for so worthy a cause. Another 5s. a week, as suggested, would give us a pensions bill of between £7,000,000 and £8,000,000 a year, and we must remember that we have to provide war pensions amounting to £7,000,000 per annum.


Mr Tudor - The war pensions will increase for many years to come.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - I would not say that.


Mr Tudor - Our returned soldiers are getting married, and will have children.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) --But, unfortunately, soldiers die like other people, and I do not see that there can be a very much larger increase in the war pensions. I think that we are pretty well at the apex now.


Mr Bayley - The American experience was contrary to that.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - I know; but the American experience is not ours, nor is ours American administration. However, that is as it may be, and it remains to be seen whether the war pensions will increase, decrease, or remain stationary. I rather think, as I say, that we are getting towards the apex of expenditure.


Mr Jowett - You are a very sanguine man !


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - If the war pensions increase beyond £7,000,000, it means that our pensions expenditure, taken altogether, will be a . tremendous liability on the country. At any rate, to give the old-age. and invalid pensioners another 5s. a week would mean a yearly bill of close on £8,000,000, in addition to the £7,000,000 or £8 000,000 for war pensions.


Mr Austin Chapman - What is the alternative?


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - There is a limit to the capacity of the country to contribute even to desirable objects. The honorable member ' for Eden-Monaro (Mr. Austin Chapman) has told us that there are sources of wealth that could be tapped, and has spoken of " moneybags " from which revenue could be derived. But the "money-bags" are being tapped to-day.


Mr Austin Chapman - Some of them. The Government have not had a " bob " towards the loans from a lot of rich people who ought to be made to pay.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - I remind the honorable member that there is not only the question of loans, but the question of taxation, and some of the " moneybags " are being taxed up to 8s. and 9s. in the £1 for Federal purposes alone, in addition to the taxation paid to the States. The "money-bags" are "paying up " and it is no use girding at them unnecessarily; nor must we let sentiment run away with us when dealing with these poor old pensioners. They are an obligation, and I am one who believes thoroughly in the old-age pension system. I think the State owes something to these people, though I do not pretend to agree with the statement made this afternoon that there are no obligations remaining with members of the pensioners' families. I do not lay down that doctrine, and I do not think that an unfortunate member of a family should be altogether a direct charge upon the State when there are other members of the same family who should discharge their family obligations if they are able to do so. However, this motion is really not an old-age pensions proposition, but one to create a destitute and benevolent department, which is to be associated with the Old-age Pensions office, and statutory authority for the establishment of which is to be incorporated with the Old-age Pensions Act. So far as I read it, it simply means that any old-age pensioner who cares to make a statutory declaration that he does not possess sufficient means to enable him to make ends meet, shall be at once granted an additional 15s. per week.


Mr Considine - It does not say that. It provides that " any person " making a statutory declaration shall be granted that additional amount. . It applies, therefore, to any inhabitant of Australia.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - And, therefore, to any old-age pensioner.


Mr Considine - It goes much farther than the Minister suggests.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - I know that. I am merely dealing with one aspect of it. It means that an' additional 15s. per week shall be granted to every old-age pensioner who cares to go before a schoolmaster, a postmaster, a Customs officer, ai union secretary, a magistrate, or " other appointed individual," and make a statutory declaration that he is insufficiently fed, clothed, or sheltered. Such a provision would double the cost of our old-age pension scheme at once. At present, our old-age pensions amount to £5,300,000 per annum, and the effect of adopting this proposal would be to immediately increase them to £10,600,000 per annum. But, as the honorable member for Barrier (Mr. Considine) has very properly pointed out, this motion relates to all destitute persons in the community. Clearly, therefore, we should increase, that sum very considerably. Indeed, it is safe to say that if effect were given to this motion, our yearly bill for old-age pensions and destitute persons would aggregate, £12,000,000 ot £13,000,000.


Mr Mathews - That would cure the position very quickly. The pensioners would go to work then.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - Would it cure the position? Would a pensioner be likely to go to work if, instead of receiving only 15s. per week, he received 30s. per week 1


Mr Mathews - Men become destitute because of the economic situation. The Minister knows that.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - I have yet to learn that an increase of the old-age pension would cause destitute persons to go to work.


Mr Austin Chapman - There are many honorable members who cannot support this motion, but who are in favour of increasing the old-age pension


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - I know that. The honorable member is quite diplomatic in eschewing all the other aspects of the motion, and in confining himself to the old-age pensions side of it. But nobody can agree to a proposition of this kind. It is far too sweeping.


Mr Mathews - Although there are financial difficulties in the way, if the Minister himself will reflect for a little while he will recognise that the course proposed to be adopted is the correct one.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - I should like to point out another striking fact in connexion with these old-age pension increases. Somehow or other every increase in the amount of the pension opens the way to a tremendous increase in the number of applicants for it. The pension becomes more attractive, and people who would not apply for it when it was only 10s. per week do not scruple to apply for it when it is 15s. per week. I have here some instructive figures in this connexion. Our officer goes on to say that during the year following 1916, when the pension was increased from 10s. to 12s. 6d. per week, the number of pensioners increased by 6,488, whilst in the year previous to 1916 the increase in the number was only 2,791. The figures for the halfyear ended 30th June, 1920 - the Act had again been liberalized in the meantime! - are even moreconvincing when compared with the corresponding six months ended 30th June, 1919. The increase in the number of applicants for the six months ended 30th June last was 1,579, whilst for the six months just closed it was 4,313 - an increase of 2,634 above the normal increase.


Mr Riley - The point is whether the applicants were, by reason of age, qualified to receive the pension.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - The facts show that every increase in the amount ofthe pension attracts people who did not ask it previously. That is the point which these figures bring out.


Mr Riley - But the applicants must he qualified.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - A new set of pensioners apply for the pension immediately the terms are liberalized in this way.


Mr Gabb - Is it not a fact that the increase in the cost of living has compelled these extra persons to apply for the pension ?


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - Certainly not.


Mr Austin Chapman - The Minister is on a slippery wicket now.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - Indeed, I am not; why should I be? Surely the increased cost of living ought to have given us more pensioners when pensions were on the lower rate. But experience shows that the higher the pension the greater is the number of applicants for it.


Mr Gabb - Have not the increase in the number of pensioners, and the increase in the cost of living, been concurrent ?


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - Not to the same extent.


Mr Mathews - The increase in the cost of living is 100 per cent.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - I would like the honorable member to understand that the increase in the number of new pensionershas amounted to about 150 per cent. in two years. Surely the cost of living has not risen to that extent within the same period. The simple fact is that the higher we make the pension rate the more applicants there are for the pension, because the more tempting it becomes. People who would not bother about it when it was 10s. or 12s. 6d. per week do bother about it when it is made 15s. per week. I am stating these facts in order that honorable members may ruminate upon them, and in the hope that if they can offer a better explanation of them they may favour me with it on some future occasion.

I have here another set of figures relating to the number of old-age pensioners in the Commonwealth, which will prove interesting to the House. In April last there were 98.750 old-age pensioners in the Commonwealth, and 34,000 invalid pensioners. The old-age male pensioners number, approximately, 39,000, and the female pensioners 59,000. There are thus 20.000 more female oldage pensioners than there are male. The invalid pensioners comprise 16,000 male, and 18,000 females- a total of 34,000. These figures, of course, are not absolutely correct, but they are sufficiently close for ordinary purposes. The percentage of old-age pensioners to those who are eligible by age is just less than 34 per cent. for men, and just over 34 per cent. for women. The qualifying ages are, respectively, 65 and 60 years. The numbers of pensioners, according to population at 30th June, 1919, were as under : -

 

About21/2 per cent. of the entire population are in receipt of pensions in one way or another.


Mr Mathews - If a destitute allowance were made, the proportion would not be more than 3 per cent.


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - Experience does not justify that assertion. Figures show that with every effort at liberalization, there is a great increase in the applicants.


Mr Mathews - Is not the difficulty of finding the money due to commitments as the outcome of the war?


Sir JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) (Minister for the Navy) - Of course, that is one of the reasons. However, everything in the world is more or less relative ; and with all the criticism of our old-age pension scheme, it is still the most liberal in the world. I should be glad to be able to concede this extra 5s. per week if, in the circumstances, it were possible to do so; but this year, with all our towering commitments, we are paying the old-age pensioners of the community an additional £1,500,000, and I am afraid that it is more than I can promise at the moment to consent to pay them another £1,500,000 next year.







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