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Coalition divisions

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Minister for So< n H o w e MP

BLH 37/89

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The Liberal and National Parties disagree on the fundamentals of their expenditure cuts approach.

On 29 May Dr Hewson "confirmed that (coalition) social welfare cuts would not be based on reducing fraud, an area where the government had done a good job." (Sydney Morning Herald 29/5/89).

This morning Mr Blunt "attacked the Federal Labor Government for not addressing the rip offs in the welfare bill .... He told the (National Party) conference while a Coalition Government would ensure the rules were enforced." (AAP

16/6/89) .

On 25 May David Connolly the Liberal Shadow spokesman said "Any campaign which promotes a "crackdown on welfare fraud" can indirectly malign legitimate users of the Social Security system". (House of Representatives Standing Committee on Community Affairs).

The facts are:

. since 1983 Social Security outlays have fallen from 6.9% of GDP to 6.2% in 1987-88 and a projected 6.0% this year;

. since 1983 the proportion of pensioners and beneficiaries has fallen from 41.9 per 100 people in the labour force to 35.9 per 100 in June 1988;

. since 1983 the administration of Social Security has been tightened by an unprecedented restructuring of benefits control and debt recovery by DSS.

"If Mr Blunt knows of incidents of Social Security fraud he must immediately inform the police or the Secretary of the Department of them" Mr Howe said.

Meanwhile Mr Peacock must resolve the latest divisions in the coalition.

Does Mr Blunt speak for the coalition?

Or does Dr Hewson?

Or Mr Connolly?

Media Contact: Jane Smith (062) 77 7560