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Thursday, 10 November 1983
Page: 2587

Dr BLEWETT (Minister for Health) —Mr Speaker, I seek your indulgence to expand on an answer I gave yesterday.

Mr SPEAKER —I grant that indulgence.

Dr BLEWETT —Yesterday the honourable member for Paterson (Mr O'Keefe) asked me a question about the application of the assets test to pensioners living overseas. In giving my answer, I promised him that I would seek further details in answer to the question. I promised him that I would speak with my colleague the Minister for Social Security (Senator Grimes) and give him a more detailed response to the issues raised.

He raised the question of the number of pensioners living overseas. As at 30 June 1983 18,621 pensioners who live outside Australia were paid pensions. Some of these people have assets overseas and, of course, some of them may also have assets in Australia. In addition, it is possible that some people living in Australia also have assets overseas. As the honourable member pointed out, in some countries the Australian pension may provide quite a good living but, of course, in other countries, because of exchange rate and inflation factors, it may not. The balance depends very much on exchange rate factors and inflation factors in various countries.

It is a practice, in accordance with international behaviour, that Australia does not adjust its basic rates of pension in relation to living costs overseas. The usual method that countries use to protect the pension rights of their individuals and to co-ordinate national social security systems is through the negotiation of reciprocal agreements, which I mentioned yesterday. These agreements typically provide provisions for administering such things as assets tests. As honourable members know, we have agreements of a reciprocal nature with New Zealand and the United Kingdom, and we are presently negotiating one with Italy. Consideration is now being given to the valuation of assets for the pension income and assets test and ways in which that administration would be conducted overseas. The method of dealing with the valuation of overseas properties is one of the matters under detailed examination at the moment. But it is the Government's determination that the assets test will apply equally to all pensioners regardless of where they live.