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Social security system must promote independence



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MEDIA RELEASE

EMBARGOED until 7.00pm

THE SENATE

SENATOR TONY MESSNER SHADO W MINISTER FOR COMMUNITY SERVICES

75/85 .

SOCIAL SECURITY SYSTEM MUST PROMOTE INDEPENDENCE

Radical reform was required of the tax and social security systems

to remove disincentives for Australians to strive for independence

which, if left unchecked, would have dire consequences for future

governments' expenditure on social welfare.

Senator Tony Messner - the Shadow Minister for Community Ser­

vices - was speaking at a Liberal Party meeting in the Federal

electorate of Goldstein.

"The existence of 'poverty traps' within our income security

system act as great disincentives for welfare recipients to

practice self-provision and strive for independence."

"These poverty traps arise when the dual operation of income

tests and income tax cause welfare recipients to lose as much

as 65

"Clearly these penalties deter people on a wide range of Comm­

onwealth welfare benefits from seeking additional income to

either supplement or replace those benefits."

"Unless action is taken to overcome this problem Australian

taxpayers and governments will, in future, have to finance

ever-increasing social welfare bills. The only practical way

to avoid these future costs is to promote self-provision, and

independence." .

"This would then allow governments to better direct welfare

benefits to those in need."

"The existing problems would be overcome through closer inte- -

gration of the tax and social security systems and the prov­

ision of incentives through the tax system. That is the goal

of the Liberal and National Parties."

. . . /2

REPRESENTING IN THE SENATE: SHA D OW MINISTER FOR SOCIAL SECURITY. EMPLOYMENT & INDUSTRIAL RELATIONS A N D IMMIGRATION A ND ETHNIC AFFAIRS

2 /

"Regrettably it is a challenge which the Hawke Government is

ignoring."

"Although the Draft White Paper on Taxation recognised the

existence of these problems and noted that the introduction of

the assets test had exacerbated these, it failed to outline

a strategy to achieve integration."

"One of the most fundamental differences between the Liberal

and Labor Parties is that while the ALP seek to promote dep­

endence upon the State, our Liberal philosophy commits us to

encourage independence amongst Australians." .

"Our income security system will seek to do just that."

MELBOURNE 18 JUNE 1985

Contact: Barry 0' Farrell (08) 213 224 0

333 2120 a/h '