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Budget 2002 may tighten arrangements for disability pensions.

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LINDA MOTTRAM: With the federal election well out of the way now, the government looks set to deliver a budget next week that boldly goes to some quite contentious cost-cutting measures—the kind that governments avoid in budgets delivered just before elections. With an eye to paying for the burgeoning Defence budget, the government is set to tighten spending on disability support pensions and on the Job Network.


And, for the first time, it also plans to make it harder for some blind people to receive the pension. It will tighten the current arrangements which allow anyone who’s visually impaired, regardless of their income or assets, to get a disability pension. From Canberra, Alexandra Kirk reports.


ALEXANDRA KIRK: The government’s expecting to make savings on its billion dollar a year Job Network because job agencies have found it difficult to get some long-term unemployed into lasting work. The coalition is also revamping incentive payments to providers after some were found to be parking the unemployed and not providing any substantial assistance. But the most contentious budget belt-tightening will be changes to disability pensions, including those for the blind. Last year’s budget promised extra welfare spending worth $1.7 billion over four years; next week’s budget will set out the government’s plan to start pursuing big savings.


The disability support pension, worth more than $6 billion this year, continues to spiral. It’s $50 a fortnight more generous than unemployment benefits and, unlike the dole, is not activity tested. The government’s concerned about the growing numbers of particularly unemployed middle-aged men who are on disability support pensions rather than the dole. The coalition is set to announce next week tighter conditions for the disability support pension. At present disability is defined as not being able to work 30 hours a week. A source has told AM that from July next year anyone able to work 15 hours a week at award wages will no longer qualify for the disability support pension. That will only affect new applicants, though the government is looking to phase in tighter rules as existing disability pensioners come up for review every two years. And to stop more people ending up on the disability pension, the government will offer more help to get them into work, such as rehabilitation and greater access to the Job Network.


Over the past couple of years, the government has deliberately shied away from contentious welfare reform, not wanting to be seen as attacking the less fortunate—for example, permanently blind people, entitled to a special category disability pension which is not assets or means tested. Privately the government considers the lack of any such conditions an historic anomaly and inequitable, arguing that technology and a changing labour market mean many more blind people can and do work. So the budget’s expected to tighten eligibility or introduce eligibility criteria such as an income and/or assets test from July 2003 for blind people who are able to work.


Community Services Minister, Amanda Vanstone, is refusing to comment, telling AM she won’t discuss budget-related matters.


LINDA MOTTRAM: Alexandra Kirk reporting from Canberra.