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Tuesday, 16 September 2003
Page: 20212

Mr BRENDAN O'CONNOR (8:29 PM) —I rise to echo the sentiments of the member for Fowler and the other members on this side of the House on the Family Assistance Legislation Amendment (Extension of Time Limits) Bill 2003. This bill is an improvement on the current system, but it is too little too late for the constituents in my electorate who are suffering from what is clearly an unfair and inefficient system. The government puts many families—not only in my electorate but in all electorates—under enormous duress by expecting them to make payments when they have underestimated their income. It also limits their ability to be topped up when they overestimate their income.

I would like to start by indicating Labor's position on the good news that this bill will now provide two years from the end of the financial year for those people receiving family tax benefits to receive a top-up. In other words, this provides them an extra year to notify the government and receive any moneys owed. This is an improvement, but it is too little too late. It does not go in the other direction. It is not as if the government has to notify a family who have to pay money back within two years when there has been an overpayment. So this process certainly does not apply in an equal manner; it is skewed towards the government taking money if there is overpayment and providing only a two-year window of opportunity for a top-up. That is an issue that is of concern to me and, I know, to other members.

In summary, the time limits for making past period claims for family tax benefits and child-care benefits have been extended by 12 months. That is good but not good enough. The time frame for the payment of top-ups to the family tax benefit as a result of income reconciliation will be extended from one to two years after the end of the income year. So there is a benefit there. However, in many cases people were not aware that if they tried to claim the money after 12 months they would not receive it; therefore, it is not necessarily the case that they will be any more aware that they now have two years. Why is there a two-year threshold on claiming moneys? For example, when people are underpaid at their workplace they have up to six years in law to make a claim. The statute of limitations for making claims on employers or other debtors in certain circumstances would be six years. So why in this case is there only a two-year period when it is your money in the first place? You have tried to do the right thing but have overestimated. You have not tried to suggest that you were not going to earn a particular amount of money. I would think that most families who make a judgment of income and overestimate that income are the last people we want to punish in terms of the payment system. So I think this is an area of real concern.

As the member for Fowler said, there are so many people now who could suffer under this system. The family tax benefit requires most eligible families to provide a forward estimate of income to receive family payments on a fortnightly basis. As I understand it, just over two million families receive payments each financial year. So we are talking about a very significant system that will affect many families. Of these 2.1 million families, approximately 95 per cent receive their payments fortnightly. The system provides that families who overestimate their annual income receive a top-up. On the last occasion about 140,000 families received a lump sum payment at the end of the financial year. While tax legislation provides individuals with the opportunity to amend their tax returns over a period of four years, the family tax benefit rules currently only allow for top-ups to be paid within 12 months. This comparison again shows the unfairness of this system. As we know, this period will become two years under this bill. Even this improvement is well short of the capacity for an individual or family to amend their tax return.

This limitation has meant that in the last period 25,072 family tax benefit customers who lodged a 2001 tax return after 30 June 2002, and/or whose partners lodged a 2001 tax return after 30 June 2002, were denied the total sum of $37,033,027, which is an average of $1,477 per family, in top-ups of their 2001 FTB entitlements. Labor have been critical of the one-year limitation on the payment of top-ups. We have made that clear and put our views on the record. I think we can take some credit for the pressure that has come to bear on this government. I do not think the Minister for Family and Community Services, Senator Vanstone, would do anything to help Australian families as a result of her own discretion. I think there has been pressure brought to bear by the many families who are seeking help out in the electorate. Indeed the Labor Party have, on behalf of those families, brought this to the attention of the government. It is only through that process, in my view, that this heartless minister has acceded to anywhere near what we would be expecting.

As can be seen, $37 million did not go to families who were entitled to that amount, because they did not make a claim before 12 months after that financial year. That $37 million obviously went elsewhere; who knows where it went. Two-thirds of the $37 million would have paid for the government's propaganda, the Pharmaceutical Benefits Scheme advertisements—I think they cost $26 million. The government are getting a celebrity doctor on television to tell us why it is in the interests of Australians and people who are in need of pharmaceuticals to pay a 30 per cent increase for their pharmaceuticals. An enormous amount of money—I think it is $26 million; it is certainly in that vicinity—has been spent on government propaganda on television explaining to the constituents and, indeed, the members—

Mr Hardgrave —Mr Deputy Speaker, I rise on a point of order. This is an exciting departure, but it is not about the bill. I ask you to bring the member for Burke back to the subject of the bill.

The DEPUTY SPEAKER (Mr Barresi)—I thank the minister. I am listening intently to the member for Burke, and I am sure that he will make the connection very shortly.

Mr BRENDAN O'CONNOR —The fact is I am speaking on the bill. I am suggesting that $37 million which should have been paid to families who were owed it was not paid, and so I am speculating on where that money has been spent. I think two-thirds of it has been spent on Pharmaceutical Benefits Scheme propaganda on television, where the television celebrity doctor—

Mr Sidebottom —The snowy haired fellow.

Mr BRENDAN O'CONNOR —the snowy haired fellow, tells the viewers why they should pay more for their pharmaceuticals. The minister know this, and that is why he is touchy on the issue. He got up to raise a matter of relevance because he knows that the community would not like to think that $26 million would be spent—

Mr Hardgrave —Mr Deputy Speaker, I rise on another point of order. The member for Burke may be trying to illustrate a point, but he is clearly departing from the context of this bill—an important piece of legislation—to make a misinformed rabble of a contribution to the debate.

The DEPUTY SPEAKER —I thank the minister.

Mr BRENDAN O'CONNOR —I understand the minister's sensitivity on this issue. The fact is that tens of millions of dollars have been spent on advertisements on television.

Mr Sidebottom —The snowy haired fellow.

Mr BRENDAN O'CONNOR —Yes, with the snowy haired fellow. He is probably a nice bloke who has been paid well to say those things.

The DEPUTY SPEAKER —The member for Burke will get back to the bill.

Mr BRENDAN O'CONNOR —In effect, I am saying that the money that has been spent on these advertisements should have been spent on all sorts of other things. Certainly those families who failed to receive $37 million would be wondering why more than $20 million has been spent on telling them why they should accept increases in payments for pharmaceuticals. That was my point. I would have been off it by now if the minister had not jumped to his feet on two occasions to complain.

Mr Sidebottom —He wants to show his tie off.

Mr BRENDAN O'CONNOR —He has outdone the Minister for Small Business and Tourism with that tie, I have to say.

The DEPUTY SPEAKER —The member for Burke is straying now.

Mr BRENDAN O'CONNOR —Yes, Mr Deputy Speaker; I could not help it. I am just wondering if that tie glows in the dark.

Mr Hardgrave —You may never find out.

Mr Sidebottom —He does!

Mr BRENDAN O'CONNOR —I do not want to find out.

The DEPUTY SPEAKER —The member for Braddon is denying his colleague the call.

Mr BRENDAN O'CONNOR —We have had a bit of levity, but the Minister for Citizenship and Multicultural Affairs is right: the Family Assistance Legislation Amendment (Extension of Time Limits) Bill 2003 is a very serious bill. This harsh minister Senator Vanstone—who clearly has no regard for family tax benefit recipients—has chosen to deprive families of tens of millions of dollars, despite pressure from the Labor Party. I am sure the backbench of the government has been inundated, if it is anything like what has occurred in my office, by many recipients of family tax benefits trying to establish why they have to pay back overpayments that they were not even aware of and now—worst of all, I think, in some respects—why, because they did not know they had to claim within a 12-month period, they cannot be in receipt of moneys.

My point is this: two years is better, but what happens if someone falls outside that two-year threshold? Why should they be deprived of money? Will more money be spent by this government on propaganda instead of on the health and welfare of the electorate? I think too much money has been spent—wasted—by this government. This government likes to talk about its economic record—it likes to talk about a lot of things—but it is silent when it comes to its waste of taxpayers' money. Not only that but it is quite happy to deprive people of entitlements owed to them under a scheme by using technical ways to prevent people being paid what is owed to them.

I am encouraged by the change from one year to two years, but it is certainly not enough. If the government are suggesting that the person who puts in a claim two years and one day after the end of the financial year in which they should have received moneys should not be in receipt of moneys, I think they have a lot of explaining to do in the electorate. In fact, they might have to get another $26 million to explain to the viewers of Australia why they should not be in receipt of their family tax benefit entitlements after two years.

In effect, the government are saying: `We weren't going to be paying you moneys after 12 months. That's a bit cruel, so now we just won't pay you money after two years—even though you are owed it and even though you, in good faith, made comments about what your income would be and acted in a manner that would put you in a position to have to actually receive a top-up.' It seems to me that that is punishing the people who have acted to attempt to assist the government. By that I mean they are overestimating their income so as not to fall into debt. They are saying, `I think this is the sum I will receive in this financial year, and I should not therefore suggest otherwise.' It seems unfair that we punish people who try to ensure they do not fall into debt under the Commonwealth's scheme.

I make it clear that I support the bill, but I am very angry about many related issues, and the government has not gone far enough with this particular issue. I could spend hours—the minister knows about this because it would happen in his own electorate—going through the case of every constituent who has come into my electorate office and talked about having to pay back moneys they do not have, and speaking about the way this measure has been applied and the effect it has had on families. That issue is relevant to this matter, but it does not substantially touch on the bill. But it is certainly a huge issue, and the government knows it. Thousands and thousands of families are being forced to pay money back because of the way amounts are calculated, and the way that is done is very unfair.

I will raise one example. I have a constituent who at the moment is a single mother and the custodian of her child; the father of the child is no longer with them. He is obliged to pay child support, just as he should be, to help with the care of the child. For over two years he has not paid child support, and the agencies have done nothing about it. But this is the rub: the father has not paid any moneys in relation to child support, but the department has calculated the mother's child support by including the amount of money she should be in receipt of. The mother has made it very clear that, whilst the father owes her that amount, no agency has enforced an order against him in terms of its payment. But the department is including that amount when calculating her child support benefit and her family tax benefit. So deductions are being made from her family tax benefit on the assumption that she is being paid child support when for over two years she has been informing the department that she is not in receipt of any moneys from the father of her child, her former husband. But the department, knowing she is not in receipt of that amount, is taking it into consideration when calculating her family tax benefit. That is just one example, and I could raise many more.

Every member in this chamber knows that this issue is a real problem for the government. The government has moved an inch in relation to topups, and I welcome that modest change—but it is certainly not enough. It should not be the case that after two years a person is deprived of moneys owed to them when, in fact, in all other comparable situations—whether it be statute of limitations on wage claims, which is four years, or on tax returns, which is six years—there are much higher thresholds. The government should have found a better benchmark than two years. I am incensed by the way the government goes about recouping moneys owed when, in some instances, it calculates a hypothetical or fictional amount for a person to be in receipt of even when it knows they are not.

There are many problems with this very cruel system that is overseen by the minister and, therefore, the government must redress it. It has to turn its eye to looking after families. There is enough pressure on Australian families already without the government turning its back on those in need of assistance—and I therefore make that point. I support the bill, but it is too little and it is too late. A lot more has to be done by this government if it wants to be seen by the Australian community as one that cares for families.