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Labor's assets test "pay as you die" scheme makes farmers beggars



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Senator Tony Messner

PRESS RELEASE THE SENATE

Shadow Minister for Community Services

7/85

LABOR'S ASSETS TEST "PAY AS YOU DIE" SCHEME MAKES FARMERS BEGGARS

The Government should review the proposed 1pay-as-you-die1 scheme in its assets test before it finally takes effect next month.

This v;as stated today by Senator Tony Messner - Shadow Minister for Community Services - as another anomaly in the Hawke Govern­ ment's assets test came to light.

"Labor's unfair assets test - from its premature and unpopular inception - has been riddled with contradictory, harmful and nonsensical elements; but no-one has been hit harder than the

farmer", Senator Messner said.

Many retired farmers who have handed down farms to their sons or daughters to work will have to go to the Government cap-in-hand and apply for a pension under "hardship conditions".

Take the following case: A retiring farmer and his wife sign the farm over to their son who has been working on the property for some time.

The Labor Government considers this couple have "deprived" them­ selves of their assets in order to gain the pension.

However, the Government considers that they still own their farm.

Thus, when the assets test comes into effect the farmer and his wife will lose their pension.

Because the farm cannot sustain two families they can apply for the pension under the 1pay-as-you-die scheme1 . Under this they may receive a pension, which accumulates into a debt, with interest being calculated at 13-5%, and which must be repaid from their estate upon death.

But here comes the Catch 22.

Now the Government considers that they have no assets against which to obtain the pension, because legally~they have given their property to their son and they have no security to which a charge for the accumulated total of the pension can be attached.

They are therefore ineligible to apply.

It is an object lesson in illogicality.

. "THIS ACTION BY THE HAWKE GOVERNMENT IS NOTHING SHORT OF OUT­ RAGEOUS: IT DENIES THE PENSION BECAUSE IT CLAIMS THE FARMER STILL OWNS THE FARM. BUT THEN TURNS AROUND AND SAYS HE STILL CANNOT HAVE IT BECAUSE HE DOESN'T OWN IT", Senator Messner said.

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So the couple are■ forced to apply for a pension under the "hardship provisions".

In other words, they have to beg from the Government for an income.

"It is not difficult to understand the frustration - if not the wrath - of the average farmer caught in this situation through the deliberate actions of the Hawke Labor Government", Senator Messner said.

"It is no wonder that even the Labor Party is nervously calling for a review of the entire assets test.

"Australia has ridden on the backs of its farmers for generations.

"One is prompted to ask today: just who is riding on whose back?"

ADELAIDE 6 February 1985

Contact: Senator Tony Messner (after hours) (08) 213 2240 (08) 271 1029