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Treasurer and minister reject claims that $3,000 baby payment will be misused by parents.

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Monday 28 June 2004

Treasurer and minister reject claims that $3,000 baby payment will be misused by parents


MARK COLVIN: With the Federal Government's $3,000 baby payment due to start making its way to households later this week, talkback radio has been buzzing with stories about how some of that money will end up being spent on booze, drugs, and the pokies. 


While no one's suggesting that the majority of the money will be squandered in that way, the worry has been that its most likely to go astray among the people who need it most for spending on new babies. 


And there have been warnings today that some teenage girls may be considering having babies so that they, too, can get the payments. 


Nick Grimm reports. 


NICK GRIMM: The $600 family tax payment has already been finding its way to many Australian letterboxes over recent weeks, and according to talkback callers to radio, and the anecdotal evidence offered by the government's critics, its created a mini economic boom for local businesses. 


Good for pubs and clubs, not so good for the little bubs say the critics, who predict an even bigger spending boom when the $3000 baby payment is delivered to new mothers from Thursday this week. 


This is what some callers to ABC local radio in Sydney had to say on the matter today. 


TALKBACK CALLER: The timing just seems to be a purely vote-buying exercise. 


TALKBACK CALLER: I bought clothes and various other bits and pieces for the kids, but I do actually have a close relative who's about to have a baby. She's desperately hoping that she makes it to the cut-off date because she really wants to have, get a new dishwasher and have an electric roller door opener put on her garage door. 


NICK GRIMM: Then there's the western Sydney school principal who says the Federal Government's $3,000 baby bonus is encouraging his students to fall pregnant. 


GLEN SARGENT: In the area that, where I work, it's a low socio-economic area, and $3,000 to those girls as I've said before is a king's ransom. 


NICK GRIMM: Glen Sargent is principal of the Plumpton High School, where teenage mums can get an education with their babies in tow. 


GLEN SARGENT: I had two visits from mothers over the past three weeks and they came to tell me that since this $3000 bonus was announced that their two daughters, they'd overheard their daughters discussing falling pregnant to get the $3,000. 


Last week when the families out here received their $600, shopkeepers were telling me that they were inundated with purchases of things that they didn't need as mothers. 


PETER COSTELLO: Hang on, if we're going to trust mothers with children, I think we can trust mothers with the financial support to raise those children. 


NICK GRIMM: Who'd have thought it was so difficult to give away money, the Federal Treasurer today defend the measures in place to ensure the money gets used as its intended. 


PETER COSTELLO: This idea that we can trust mothers with children, we just can't trust them with money, I don't adhere to that view. 


NICK GRIMM: Family and Community Services Minister Kay Patterson also argued today that there are safeguards. 


KAY PATTERSON: And we believe that the majority of families will use this wisely for the increased costs of the birth of a newborn. 


NICK GRIMM: What about reports today that teenage girls are contemplating having babies just so that they can access the money? 


KAY PATTERSON: Well I think when we saw the young girl from Plumpton High School saying to teenagers that a baby was for life, and you need to make a very serious decision, I would ask counsellors or teachers or parents or youth workers, anybody working with young people to actually stress the importance and the significance and the seriousness of the decision to have a child. 


NICK GRIMM: Yes, but that relies on somebody intervening, doesn't it? 


KAY PATTERSON: Well, whether the payment is fortnightly, or whether in six payments or whether it is a lump sum, I think is irrespective, or not of consideration. 


I think the important thing is, that young people are counselled wisely, and I don't believe this will increase the likelihood of single young people having children. 


NICK GRIMM: But one expert in maternity payments believes the lump sum is simply bad policy, even if he does think the warnings of squandered money are being overstated. 


Professor Peter McDonald is a co-director of the Australian Centre for Population Research, a joint research centre of the Australian National University and Adelaide University. 


PETER MCDONALD: Well I think it's better to have these payments paid on a regular basis to people, on a fortnightly basis, and people themselves seem to think that as well. 


NICK GRIMM: Okay, well why do you think that? 


PETER MCDONALD: Well at the moment people have the choice to get their family payments either through social security system, from Centrelink on a fortnightly basis, or in a lump sum through their tax at the end of the year, and 95 per cent of people opt to get it on a regular basis, so I think it's pretty clear that that's the way that people want to receive these payments, not as a lump sum, but on a regular basis. 


Why? Because I think that you know, they're using that, the payments go to the mother and she is usually very interested in having that kind of regular amount of money each fortnight that she can use for household expenses. 


MARK COLVIN: Professor Peter McDonald from the Australian Centre for Population Research with Nick Grimm.