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No savings on family allowances

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2 .

M inister fo r Social Security ° Brian H o w e M P

BLH 2/89 January 20, 1989



The acting Minister for Social Security, Kim Beazley, said today that claims that the Government had saved money on Family Allowances was utter nonsense and deliberately misleading.

Mr Beazley was commenting on claims made by Rob Hudson from VCOSS reported in today's Melbourne Age.

"Let me make it quite clear that the Government has not made any savings from the new system of fortnightly payments for Family Allowance, which took effect from the 29 December 1988.

"The only change has been the payment method.

"For 1989, people will not receive 12 monthly payments for Family Allowance as under the old system. They will receive 27 fortnightly payments commencing on 29 December 1988 and finishing 28 December 1989.

"Those 27 payments add up to at least the same amount of annual Family Allowance entitlement as people would have received under the old system. In fact, most people will get a little more. There are no exceptions.

"For example, a family with three children received $1132.20 in twelve monthly instalments in 1988. By the end of 1989 they will have received $1133.10 in twenty seven fortnightly payments.

"For every subsequent year they will receive $1133.60.

"The slight increase each year is to ensure that no family would lose even a few cents from the change to a fortnightly payment system. The change, in fact, has cost the government money, over $1 million in 1988-9 and over $2 million in the

next financial year.

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"The first fortnightly payment for 1989 was made on 29 December 1988 for a very simple reason.

"Under the new payment system, all families will be paid on the same day each fortnight. Under the old system, about half of families were paid at the beginning of each month, the other half of families being paid towards the end of the month.

"To ensure that no family in Australia had to wait more than a month, after receiving their last monthly Family Allowance payment in December 1988, for their first new fortnightly payment, the new system commenced on 29 December 1988. This

also means that no family is paid in arrears.

"Apart from the Government working to ensure that all families receive their full annual entitlement for Family Allowance, and not a cent less, we are also making the system simpler by introducing the new fortnightly payments” said Mr Beazley.

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